The increase in CRR by RBI has severely hit the Realty Stocks listed on BSE. Most realty stocks have crashed by over 10% in just two trading sessions. These stocks have already drpped by 50% from their yearly Highs in Jan-2007.
Home Loans have got expensive while Realtors are still arrogant about home prices. Industry insiders claim that many big ticket deals that have happened in the past couple of months will see their construction projects becoming unviable and finally going bankrupt.
Home Loans will become more expensive as the 1% cess on Housing finance companies (HFCs) and commercial banks of their annual incremental home loans will be effective from April;-1st 2007.
The 1% cess is contributed to a new “safety fund” proposed to be created under the National Housing and Habitat Policy. Major banks and HFCs will pass this cess to consumers in order to protect their bottomline.
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