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Home loan package inadequate: Assocham

December 16, 2008 10:38 IST

Terming the home loans package of PSU banks highly inadequate, Assocham President Sajjan Jindal demanded that the government peg the interest rate on housing loans up to Rs 30 lakh at 6% and at 8.5% for loans above this amount.

According to Assocham, this move will create the required growth momentum in real estate, construction, cement, steel, electrical and heavy engineering sectors.

Jindal said making home loans up to Rs 5 lakh available at 8.5% and between Rs 5 lakh and Rs 20 lakh at an interest rate of 9.25% did not make sense as properties are hardly available at this cost, even in Tier-II and Tier-III cities, let alone metros and large townships.

"Therefore, the government should make housing loans at suggested 6% as well as 8.5% interest rates, if it is really serious about creating demand in real estate, construction, cement, steel, etc," he said.

BS Reporter in New Delhi
Source: source