Mortgage lender Housing Development Finance Corporation Ltd. has not seen its non-performing assets rise due to loans to low-cost homes, Vice Chairman and Chief Executive Officer Keki Mistry said.
“20 percent of our loans in terms of value are to people in the lower income group and the economically weaker sections,” Mistry told BloombergQuint in an interview. “The lower end of the housing market is interesting.”
Prime Minister Narendra Modi's affordable housing scheme has boost demand for low-cost homes. The scheme offers subsidy on loans borrowed by low-income buyers for such homes. A recent study by the Reserve Bank of India, however, found that small-ticket home loans up to Rs 2 lakh had the highest level of non-performing assets.
While the real estate market is recovering from the double disruption of demonetisation and a new housing law, Mistry doesn't expect a runaway increase in property prices. “One should expect a slight upward bias in prices to keep pace with inflationary increases,” he said, adding that an increase in supply will keep prices under check.
Also Read: Mumbai's Real Estate Will Take At Least A Year To Revive, Knight Frank Says
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