Govt to take more steps to boost housing sector

In order to boost the real estate sector, the government today said additional measures would be taken to encourage housing activity.

"This sector (housing) will be kept under a close watch and additional measures would be taken as necessary to promote an accelerated growth trajectory," Finance Minister Pranab Mukherjee said while winding up the discussion on the Interim Budget in Lok Sabha.

The public sector banks (PSBs) have already announced packages for home loan borrowers of up to Rs 20 lakh, he said, adding, the RBI too has provided a refinance facility of Rs 4,000 crore to the National Housing Bank.

Following the announcement of first fiscal in December to bailout various sectors including real estate, the Indian Banks' Association came up with the special housing loan scheme for up to Rs 20 lakh.

The scheme implemented by the PSU banks capped interest rate at 8.5 per cent for home loan up to Rs 5 lakh.

At the same time, rates for Rs 5-20 lakh loans was pegged at 9.25 per cent for the first five years.

In addition, the PSU banks also waived off processing and pre-payment charges for home loans under these categories and have fixed the margin requirement for loans up to Rs 5 lakh at 10 per cent. For the Rs 5-20 lakh loan-bracket, the margin was fixed at 15 per cent.