While buying a house will make a deeper hole in the common man's pockets with the hike in home loan rates, analysts do not expect any major impact on the country's booming real estate sector.
The floating rate of home loans by banks have gone up to near 10 per cent while the fixed rates has gone up to nearly 11 per cent. The move follows the recent hike in repo and reverse repo rates by the Reserve Bank of India.
The current hike by all major banks in the country is the third home loan rate hike by the industry in the last one year.
However, analysts said that due to the attached tax benefits, home loan is still one of the best options for consumers to buy a house of their own.
Leading developers have also echoed the sentiments, saying that the demand and sales have not been impacted at all due to the rise in interest rates and they have nothing to fear for now.
"The cost to the consumer has definitely increased due to the hike in the home loan rates but it would not affect the real estate business. I don't forsee any negative affect on the demand or sales in the real estate sector as the current interest rates is still lower than what it was in the distant past," Parsvnath developers Chairman Pradeep Jain said.
{{/usCountry}}"The cost to the consumer has definitely increased due to the hike in the home loan rates but it would not affect the real estate business. I don't forsee any negative affect on the demand or sales in the real estate sector as the current interest rates is still lower than what it was in the distant past," Parsvnath developers Chairman Pradeep Jain said.
{{/usCountry}}Developers believe that the consumers, who are affected are the borderline customers and this would not effect the demand in their business.