Measures to help housing sector not sufficient: developers

The economic package, particularly rate cuts and easing of ECB norms, will increase flow of funds into the struggling housing sector, but more measures are needed to enable the realty business to bounce back, developers said.

"Even though the RBI has slashed rates, financial institutions have not been lending to developers... There is further scope for easing loan rates," real estate consultant Jones Lang Lasalle Meghraj Chairman and Country Head Anuj Puri told PTI.

"The stimulus package announced by the government will re-generate the demand cycle in the housing sector, which remained subdued on account of high home loan rates, high prices of residential and general economic condition," he said.

"Prices maintain the equilibrium between demand and supply. The only fear is if realtors cut supply in accordance with slumping demand, prices would start rallying again. Hence, supply needs to come into the market and the government's move is a great step towards that," Puri said.

Corroborating Puri's view, noted industrialist Adi Godrej said, "Loan rates are still not low enough... I expect these should further ease by April-May along with inflation, which should also come down considerably by that time."

Sharing similar sentiments, Sunil Mantri, Chairman of Sunil Mantri Realty, said, "The relaxation in ECB norms and the repo rate is a welcome move, but we were expecting the RBI to raise the priority home loan benchmark to Rs 50 lakh."