Home Loan Rate inTerest Rates: Burdening the Masses?

Higher home loan interest rates will soon become a fact of life from the coming month, thanks to the announcement of the Reserve Bank of India (RBI) for increased repo rate and Cash Reserve Ratio (CRR)

While expectations of a rise for home loans between 0.5% and 1% in the interest are predicted by home loan lenders, some have even indicated a jump of 2%.

This will add to the monthly investments’ increase for an average home seeker who already feels burdened with overall costs of buying a house.

With the cost of living already going up by rising inflation standards, don’t we need an innovative thinking for housing loan solutions offered by government authorities or the developers that may save us from the both financial as well as psychological pressures?

Realty Prices will Increase..?

Experts may be saying that inflation won't affect real estate, but logical reasoning suggests that rise in commodity prices will force real estate developers to raise prices in some way or the other. Since, the operating profits from projects launched after 2005-06 are already low in terms of applied costs and expenditure, a developer has no choice but to escalate his product price.

Recently, the builders association of Bangalore declared to raise property prices all across its projects. Well, this indeed is a formal declaration. Otherwise, most of such moves will be taken without creating any hypes..

What's your take..?

For more details on Bangalore Property Prices, log on to magicbricks.com

Can Green Homes be Affordable?

Building green homes is becoming popular in India. Civic authorities started this trend by constructing energy efficient buildings. These buildings use energy saving practices like making optimum use of daylight, reusing water and conserving energy. The India Habitat Centre at New Delhi is one such building.

Many private property developers are trying to incorporate these features in their construction. The only hindrance is that the construction material required to build an energy efficient building (special bricks, glazed glass etc) is very expensive. Hence the overall construction cost rises.

Will any technological innovation help in reducing costs for green buildings? Do you know of any property developer who is constructing green homes?

Aam admi’s Concern

Inflation is likely to take its toll on the property markets. The cost of living in Indian cities is rising like anything. The RBI in its annual policy for 2008-09, had expressed its intentions to bring down the rate of inflation to 5.5%, however, it had reached record high of 8.4%, averaging between 7-8%.

Rising fuel cost, also, is not a good sign for the markets. The cost of construction will rise.

Certainly, you and I, who could earlier think of buying a residential property on an EMI, will now have to recalculate how much can be paid towards loan installment.

Tough time!!!

Can you Time Real Estate Markets?

Only buy something that you'd be perfectly happy to hold if the market shut down for 10 years. When legendary investor and one of the most richest men in the world Warren Buffett says this, it becomes quite clear that investment is not a short term game.

The same holds true for real estate investments as well. Today, the markets are slackening and most of the experts concede that demand for property has been going down and down.

You must be wondering whether it is the right time to buy property or not but believe it you might not be able to time markets. And it happens most of the time.

However, if we look at the long term prospects of the Indian property markets and the underlying fundamentals of Indian economy, investing in property is the option that can bring suitable rewards for investors in the time frame of 5-15 years.