Click to play videoMumbai: With decline in Home loan demand due to hike in the interest rate, it is expected that property prices would go down.
And with rising interest rates affordability has become an issue for home buyers.
Experts have been predicting a correction for long. But the first signs of that happening may now be visible.
“In this current quarter we've seen transactions going down more sharply. If I take big towns there the numbers have gone down by 10 per cent, in smaller locations this figure is down by close to 15-20 per cent,” said ICICI Bank Sr GM-Retail Assets, Rajiv Sabharwal.
According to ICICI Bank property prices in smaller cities such as Chandigarh, Jaipur and Bhopal have started correcting already. But big cities like Mumbai are better off.
“In Mumbai, transactions have gone down by 10 per cent if I compare it to the previous quarter. As far as prices are concerned we have still not seen a drop in prices but I feel that since the transactions have come down, to ensure that the transactions go up, there will be certain discounts, if not available now, very soon they will be available – at least 10 per cent,” said Sabharwal.
ICICI bank recently said it expects home loan market to grow at no less than 25 per cent. It now remains to be seen whether property prices will fall owing to tightening affordability.
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