Friday, December 9, 2011

Realtors ask to revise ceiling to home loan

The realtors want the central bank to revise the ceiling of Personal Home Loans to Rs 10 million from current Rs 8 million.
“If the Personal Home Loans ceiling is jacked up by additional Rs 2 million then the demand for apartments and houses can be expected to grow reviving the market," according to general secretary of Nepal Land and Housing Development Association (NLHDA) Min Man Shrestha.
The commercial banks have lent Rs 25.2 billion under the heading of Personal Home Loans till the first quarter of the current fiscal year. In the last quarter of the last fiscal year also the banks have floated Rs 29.5 billion under the category. Personal Home Loans floated by the banks are equivalent to 23 per cent of total loans in forwarded to real estate sector which stand at Rs 123.8 billion in the first quarter.
To give respite to realtors and prospective home buyers, central bank, in March, created a separate category for the home loans as personal Home Loans. Nepal Rastra Bank (NRB) revised the loanable amount under this heading from Rs 6 million to 8 million this fiscal year. This Personal Home Loans up to Rs 8 million is not dealt as the part of real estate and housing loans.
However, central bank is skeptic that increasing home loan ceiling will be a prudent decision. "NRB will decide whether or not to revise ceiling based on the financial market condition, but the point to be pondered is can average Nepali afford to buy a home that will require to take loan of Rs 10 million," expressed Bhaskar Mani Gyanwali, spokesperson for NRB. "The need of the movement is to build inexpensive housing unit that will be available at less than Rs 5 million so that lower middle class and middle class family can afford to buy.”
The banking sector has taken the brunt of cooling off of realty market since last one year as the loan default rate and Non Performing Assets (NPA) have since then growing. Moreover, scaled up interest rate following the liquidity crunch have further pushed the real estate market into recession like situation coupled up with lowered demand.
"The major factor than can stoke the realty market is reduction of interest rate, at 15-16 per cent interest not many people can afford to borrow and buy homes," said Shrestha, adding, that 10 per cent is the ideal rate in which everyone is a winner.
NHLDA has submitted a request to NRB including these issues along with refinancing affordable housing projects as a means to revive real estate and housing market.
From the fear of eventual systemic failure invited by banks and financial institutions' overexposure to realty, NRB directed the financial institutions to restrict the credit flow to a single sector to 25 per cent of their total lending, in December 2009. During that time, the boom in housing and realty contributed to high lending exposure in the sector so that few of the commercial banks’ portfolios showed dangerously large amount of credit floated to the realty.

New rule
KATHMANDU: Nepal Rastra Bank (NRB) has allowed the class 'B' and 'C' financial institutions with headquarters situated outside Kathmandu valley to maintain interest yielding all accounts in other commercial banks till the end of this fiscal year, issuing a circular on Friday. "The financial institutions outside Kathmandu do not have options much for investments so central bank has allowed then to maintain interest yielding accounts," informed Bhaskar Mani Gyanwali, spokesperson for NRB. Likewise, the same circular has also asked all the class 'D' microfinance institutions, co-operatives and NGOs licensed by NRB to undertake limited banking services to submit the credit information regarding borrowers that have borrowed funds exceeding Rs 30,000 to Credit Information Bureau (CIB).


Anonymous said...

In the US, we still express this as cubic inches, feet, or yards.

First, ready mixed concrete in Sunderland can help you get your construction job
done faster. Say we are laying out a simple home 30' x 45'; if
the last dimension was forty feet instead of forty-five then the cross corner measurement would be fifty feet.

Anonymous said...

If you are like me and love garlic, you are already too late.
Use the cultivator to make holes in the soil and turn it up just a little between the rows.
This will give them time to acclimate to their new environment, avoiding stress and shock often associated with transplanting, ensuring a healthy start.

My web page: limousine

Anonymous said...

This makes the mixing phase a lot easier, just put
in your concrete and water, and off you go by the wheelbarrow load.
If a hairline crack in concrete has turned into a large crack, it will
need to be cleaned out before the patching and repairing
process. Say we are laying out a simple home 30' x 45'; if
the last dimension was forty feet instead of forty-five then the cross corner measurement would be fifty feet.