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  • Overall unsold inventory of luxury homes (priced INR 1.5 cr – INR 2.5 cr) declines to 42,650 units in Q1 2019 from 48,300 units in Q1 2018
  • MMR currently accounts for maximum share at 56%
  • Bangalore sees 49%, Kolkata 37% yearly decline in total unsold ultra-luxury homes
  • NCR and MMR each saw a 7% decline in pent-up luxury inventory during the year
  • Mid-segment (INR 40 lakh – INR 80 lakh) saw max. reduction with 14%; affordable (<INR 40 lakh) saw a 3% rise in total unsold stock in this period

Anuj Puri, Chairman – ANAROCK Property Consultants

The slowdown in Indian residential real estate over the last few years caused most high net-worth individuals (HNIs) to shun luxury housing and look at other investments within or outside real estate.

However, ANAROCK’s latest study indicates that HNIs are now using the tail end of the slowdown in India’s luxury residential market to their advantage.

Stagnant prices and best-buy deals have brought back some of the demand luxury homes, leading to a decline of 12% in this segment’s overall unsold stock in one year.

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Anuj Puri, Chairman – ANAROCK Property Consultants

As widely anticipated, RBI has once again reduced its key lending rate by 25 basis point. The lending rate now stands at 5.75, and this is the third consecutive rate cut since February 2019.

Even though the Indian economy is perceived to be in the grips of a slowdown, the markets are quite bullish on Modi’s return to power with a thumping majority.

This may eventually lead to mitigated risks in fiscal deficit – in all likelihood, it is sensing this that the RBI has made this rate cut.

As for the housing sector, this rate cut may send only send out positive notional signals – its real gain can be realised only if banks pass on the benefits to actual homebuyer borrowers.

The apex bank will need to ensure that this actually happens at the ground level since there has been little evidence of such transmissions in the recent past.

In the current scenario bereft with rising NPAs and the ongoing NBFC crisis, things look quite bleak at the moment.

The reason why most banks are not really able to pass on the benefits of RBI’s rate cuts is that their deposit rates are still very high.

Shajai Jacob, CEO – GCC (Middle East) – ANAROCK Property Consultants

Just like resident Indians, NRIs can invest in any number of properties in India and are also eligible to avail of home loans for as many properties as they like.

Of course, while there is no cap on the number of properties for which an NRI can take home loans for, repayment capacity must always be factored in.

Over-leveraging is never a good idea and regardless of what viewpoint a bank takes, NRIs must do their own repayment capacity calculations.

In India, most banks and non-banking financial institutions offer home loans to NRIs. However, the tenure of the home loan may vary, and the rate of interest is usually higher for NRIs.

Loan Tenure and Rate of Interest

An NRI usually has to pay a higher rate of interest than resident Indians. The tenure for a home loan to an NRI usually ranges between 5 to 20 years – only in select cases can it go up to 30 years for salaried professionals.

Most banks determine the loan amount eligibility of NRI borrowers based on their income and credit history.

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