Is dream home affordable?

With PSU banks finally offering attractive interest rates for home loans below Rs 20 lakh, the assumption was that it would spur demand in smaller towns where housing is cheaper.
As getting a Rs 20 lakh home loan just got cheaper at a 9.5% interest rate, buyers flock and builders revel, a welcome break after the long realty slump.
Be it Surat or Indore, realtors as well as potential homebuyers are rejoicing, as apartments in good localities are available for as low as Rs 1300 per square feet.
Swetaang Shree Maali, a Builder, Neo Associates (Indore), said, ”For builders this could rise our liquidity position as people will start buying”.
Buyers too are happy as they feel that now with the government’s move, state banks have reduced rates, so they could fulfill their dream of buying a home.
Well, a look at the rates in emerging IT hub Pune and Bhubaneswar in Orissa reveals that the mood is not quite upbeat despite the attractive package announced by the PSU banks.
A two-bedroom house in both these cities will still mean shelling out at least Rs 30 lakh.
Anup Mohapatra, President of Real-Estate Developers’ Association, said, “20-30% of the bookings come from the single executives and employees in the IT sector but now you can’t expect bookings from them because they are under constant threat of losing jobs.”
He added further that the package won’t help Pune people in any way as the rates of the properties here are so high that one won’t get anything even for Rs 20 lakh.’
Hence clearly, the package is a liquidity pump for builders, hopes for a new home for others, but a significant rest are still wondering whether the special package announced with much fanfare by the PSU banks will help them buy their dream home.

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