Falling Home Loan Rates a Boon for Property Investors


In welcome news for the Indian real estate market, major lenders are making home loans more affordable. Last week, the State Bank of India, which is the country’s largest bank, reduced home loan rates for the second time this year. At 8.35%, the reduced rate is expected to spur investment in the property market, particularly by first-time borrowers. This week, other institutions such as HDFC (India’s largest mortgage lender), ICICI Bank, and LIC Housing Finance have followed suit with comparable reductions.

The move to reduce borrowing costs complements recent central government measures, such as granting infrastructure status to affordable housing, to make homeownership more accessible for lower-income families. As always, lower borrowing costs benefit real estate investors. Easier access to capital will naturally lead to increased demand for housing, which in turn will push real estate prices upward in both the primary and secondary markets.

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