Favourable demographics, improved affordability of residential properties and historically low mortgage rates are pushing the demand for home loans, mortgage lenders said.
Several major banks, mortgage companies and housing finance companies have significantly reduced their interest rates on home loans during the festival period to encash revival in housing demand after the second wave of the Covid-19 pandemic.
In some cases, the interest rate on home loans is as low as 6.5 per cent.Asked about the likely impact of its decision to cut mortgage rates for the festive season on home loan disbursals, HDFC Managing DirectorRenu Sud Karnad said the lower interest rate does help but it is just one of the many variables for the pick-up in demand for home loans.
“Housing today is much more affordable than it ever was. In the last couple of years, property prices have more or less remained the same across the country while income levels have gone up,” she noted.
Karnad further said people are upgrading to bigger size apartments because of the requirements of additional space post-outbreak of the COVID-19 pandemic.
“Work from home, education from home and entertainment from home due to the pandemic have also made people realise the need for anadditional space at home,” she said.