In the post-policy press conference, Dr. Subbarao, Big Boss of the RBI, made this innocuous statement:
Shishir Shindekar: Sir the housing price index is continuously growing, so do you feel any problem regarding the housing price bubble or like that?
Dr. D. Subbarao: No there is no bubble. Housing price index is showing an increase and we have reported that in our document that came out on Thursday. The monetary and macroeconomic development document which shows the housing price index, I think in 9 cities of the country and there is no bubble building up there. Okay, thank you let us move on.
I don’t know how you define the word “Bubble” but you have to see the following statistics in their own report. The India-wide House Price Index (HPI) – which uses registration data from local state governments to determine price rises, starting from March 2009, quarterly – is depicted below.
This shows you how prices have been going up. At a CAGR of 26% since March 2009, prices are growing way too fast.
Remember, the RBI had been worried about house price inflation as far as March 2011, when average growth was way below the current number.
The RBI has officially banned Preclosure Penalties on all housing loans: (Notification) RBI/2011-12/589 DBOD. No. Dir. BC.107/13.03.00/2011-12 June 5, 2012 All Scheduled Commercial Banks (Excluding RRBs) Dear Sir/Madam Home Loans-Levy of fore-closure charges/pre-payment penalty Please refer to our circular DBOD. No. Dir. BC. 56/13.03.00/2006-2007 dated February 2, 2007 on reasonableness of bank charges. 2. In [...]
As part of my pre-budget articles: I wrote at Yahoo about our overenthusiasm for real estate and how we can curb bubbles in there. More than 2.6 crore houses are required in India, with more than 99% required for the economically weaker sections of society. To achieve this, the government has provided substantial impetus for [...]
Builders are having it tough, but a certain one, BPTP in the NCR region is offering a tie up with HDFC to give home loans at 5.99%. "BPTP…today announced a partnership with HDFC to offer home loans at just 5.99 per cent per annum. This is part of a limited period special offer, designed to [...]
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