Dt : 10th July 2007

BUYING HOMES GETTING BEYOND REACH

Rising Interest rates coupled with real shooting estate prices have left fresh home buyers beyond their reach to buy a house of their own."

Interest rates on home loans have shot up from 7.5 % to 12% during the last three years and it will be beyond imagination of people from working class to think of owning a house at the cost of almost 67% of their pay packets going towards repayment of home loans in the shape of EMI's .

Normally, banks and financial institutions don't lend money to the loanee unless he has 50% of the pay packet left with him after repayment of their EMI for the survival . And as everyone knows , salaries don't increase at such a pace to match rising real estate prices and bank rates.

As if it was not enough , overhead expenses like registration charges with stamp duty and rising Circle rates by the Local agencies and finally house tax / maintenance charges etc which continue to rise at regular intervals makes one shiver for owning one's own house. Recently, Delhi Govt. raised its circle rates and local govt agencies of its satellite towns like Gurgaon have followed suit by revising upward its circle rates by almost 15%. .

It is high time, Govt and RBI wakes up to check this trend by giving subsidies to the developers to cope up supply with demand coupled with bank rates being within one's reach to have a shelter home of their own. .

Dt : 8th June 2007

REAL ESTATE SCENARIO

For the past about 3 years or so there had been boom in Real Estate sector in India. Due to overall development in infrastructure and upcoming of Hundred's of Residential, Commercial, Industrial Projects floodgates were thrown open to the Global Investors to invest into their ventures in India. Fortunately , due to economic factors like low cost of labour etc , Hundreds of Multinational Companies started there operations and opened there corporate offices here .

Unfortunately, However due to some faulty policies of the Government the growth in this sector became stagnant and the benefits which were now to be reaped started showing negligible effect . Policies making authorities in Government are therefore required to take corrective measures like controlling rising bank rates and allowing subsidies in this sectors so as to attract more and more international investors and financial institutions to invest into their ventures here.

Whole India in general and Northern India in particular has shown tremendous growth in agricultural, industrial & commercial sectors . Haryana, a state of Northern India, is a living example of Growth and places like Gurgaon in Haryana, due to their Geographical locations and Close proximity to NCR and International airport , have become a centre of attraction of International Investors due to well thought of the Local Government and intelligently coming up with Master plan 2021 , carving out agricultural , industrial and commercial areas and providing necessary infrastructure . Resultantly hundred's of MNC's in BPO /IT sector have opened their corporate offices here and Gurgaon has become third biggest centre in India where BPO operations are being carried out. It is not an exaggeration of fact that Gurgaon today is fast emerging on International Map and due to its overall infrastructural development will match any industrial or commercial space in the world . A little more attention towards improvement in power sector will definitely make a place for Gurgaon on the International Commercial Scenario in IT sector . Government is quite alive to the situation and is doing the needful..

Realtygurgaon , on its part is dealing in all agricultural and commercial spaces for sale , purchase and leasing out these properties to the National / International customers as per their needs and we invite all multinational / national companies to avail our hassle free services to start operating their dream projects from this area .

Dt : 10 Feb 2007

RED ALERT FOR PERSONAL LOAN BORROWERS

The RBI , in its 3rd Quarterly review of Credit Policy, has again resorted to a Policy change that could lead to increase in interest rates. During the last 2 years , different Banks have raised home loan rates by 3% from 7% to around 10% and rate of interest on personal loan has gone up from 8.5% to over 11% . RBI is further concerned about unprecedented growth in consumer loans as compared to Service sector. RBI’s decision, therefore to increase the repo rate by .25% would naturally stimulate interest rate in the market upwards. And in turn , in the coming couple of months , financial institutions will face tight liquidity conditions . This will result in higher cost of funds to banks who have no other alternative except to raise funds from Deposit by offering higher returns.

Due to increase in interest rates, EMI’s in home loans have already gone up by about 25% and any further increase in rates in home loans would adversely affect home-loan borrowers.

However some top executives of banks have laid this fear to rest assuring that home loan segment would remain unaffected and interest on home loans would not go up . Final picture, however would emerge in the next few weeks to come.

Dt : 7th Feb 2007


RBI's CHECK ON NRI's BORROWING

In the quarterly review of its credit policy, RBI has banned Banks lending more than Rs 20 Lacs against NRE and FCNR(B) deposits of NRI's…...." RBI’s fear behind such loans is that major portion of these loans is being diverted for speculative purposes in the form of investment in shares and Commercial real estate. RBI is taking this step to ensure that Banks make available credit for productive sectors.

While reviewing its credit policy, there is a happy note that GDP would grow @ 9% during 2005-06’. Still, there is a bad news that there is dip in share of agriculture in GDP whereas 60% of the population is employed in this sector. Hon’ble FM P Chidambaram has cautioned to see its impact in growth figures in the current fiscal year.