Indian property market gets a boost

The Indian property market, which stagnated in many parts in the country after the boom from 2000 to 2008, looks poised for growth after the government announced some positives in its budget last week.

Indian finance minister Pranab Mukherjee has announced that external commercial borrowings (ECB) will be allowed in low-cost housing segment.

What it means is that there will be an increase in liquidity that will aid in the supply of affordable housing projects across the country.

There will also be an extension of 1 per cent interest subvention scheme on housing loans up to Rs15 lakhs, where the cost of the house does not exceed Rs25 lakhs.

But there were a few negatives for the property market in the budget too.

The overall cost of properties are likely to go up because of the hike in service tax from 10 to 12 per cent. This could make real estate in bigger cities even less affordable, but developers claim there are enough reasonably priced housing for all budgets available in many cities.

Source: Asian One Business