With interest prices at their lowest ever, India has witnessed a 42% surge in demand for Balance Transfers (BT) and a 26% rise in demand for Home Loans (HL) in H1 2021 vis-à-vis H2 2020, reveals Magicbricks Home Loans Consumer Study – H1 2021.
The report also indicates that there has also been a 20% demand rise for Loan Against Property (LAP) in H1 2021. The soaring demand has been triggered largely by the truth that the Reserve Bank of India (RBI) has kept the repo price unchanged at a continual 4%, enabling numerous banks to give interest prices significantly less than 7% for home loans. This has also been a important driver in augmenting the demand for home obtaining.
Magicbricks Home Loans Consumer Study also reveals that the most often searched HL quantity across Tier-1 cities in the course of H1 2020 was Rs 36 lakh, whilst that for BT and LAP had been Rs 26 lakh and Rs.32 lakh, respectively. For Tier-2 cities, it was Rs 26 lakh for HL, Rs 23 lakh for LAP and Rs 18 lakh for BT.
Commenting on the Study, Sudhir Pai, CEO, Magicbricks, mentioned, “The rising demand for home loans is in line with the increasing demand for residential real estate across key markets of India. Several initiatives by the government, such as keeping the repo rate constant and reduced stamp duty rates, are steps in the right direction. These measures have been instrumental in boosting the overall consumer sentiment, making almost 50% of the borrowers opt for tenures less than 15 years. With factors like low interest rates, stable prices, and attractive payment plans, we are hopeful that the pent-up demand would soon translate into sales.”
Magicbricks Home Loans Consumer Study also reports that with Work from Home (WFH) becoming a norm, home purchasers are now searching to invest in or upgrade to big configuration homes, and as a result the demand is mainly in the mid and above segments. Hyderabad, Pune, Ahmedabad, Mumbai, and Delhi are the prime-5 Tier-1 cities witnessing maximum demand for Home Loans. A comparable trend has been recorded in Tier-2 cities like Lucknow, Patna, Indore, Jaipur, and Agra.
In terms of the demand for Balance Transfers, New Delhi, Bangalore, Mumbai, Pune, and Hyderabad had been the prime-5 tier 1 cities, and Ghaziabad, Mohali, Noida, Indore, and Visakhapatnam the prime-5 tier 2 cities.
For LAP, Bangalore, Hyderabad, Chennai, New Delhi, and Pune saw the most demand across Tier 1 cities, and Gurgaon, Jamshedpur, Patna, Faridabad, and Lucknow for Tier 2 cities.
Another noteworthy getting from the report is that Bank of Baroda, Indian Bank, SBI, HDFC Ltd and ICICI Bank are the most searched lenders on Magicbricks’ Home Loans platform.