Interest Subvention May Give Impetus To Affordable Housing

Interest Subvention May Give Impetus To Affordable Housing
Chennai
The Hindu

The one percent interest subvention approved recently by the Union Cabinet is expected to provide an impetus to the affordable housing segment in the suburbs.

Banks and housing finance companies are gearing up to capitalise on this scheme and increase the disbursement of home loans.

“As a major portion of the demand is from the affordable segment below Rs.20 lakh, the initiative will be of help to a large number of buyers,” said R.R. Nair, director and chief executive of LIC Housing Finance Ltd.

However, he was sceptical of the efficiency of the scheme to cater for the affordable segment with provision of the one percent subsidy for just 12 months. “We have had discussions on the scheme and will be happy to participate in it,” he said.

An official of State Bank of India said the scheme was expected to have an impact on housing units only in the suburbs of Chennai.

Around 5,000 units with price less than Rs.20 lakh are coming up on the outskirts of the city, said Prakash Challa, president, Confederation of Real Estate Developers’ Association of India-Tamil Nadu.