Home loan demand grew by 42% in January-March: Despite rising interest rates

The increase in interest rates has not had any effect on the demand for home loans. Home loan demand was 42% higher in the January-March quarter as compared to the October-December quarter. Compared to a year ago i.e. January-March, 2022, the demand for home loans has increased by about 120% in the last quarter.
According to a survey by property site NoBroker, especially working youth are preferring to buy homes by taking loans. The firm polled over 2,000 respondents from top property markets like Delhi-NCR, Bengaluru, Pune, Chennai, and Hyderabad among others. Accordingly, the youth are now considering real estate as a safe and attractive investment.
78% of the people surveyed said that home loan rates are neither too expensive nor too cheap. However, from May 2022 till now, the Reserve Bank has increased the repo rate by 2.50%. Due to this, the average home loan rate has come down to around 9%, which was 6.5% a year ago. The country's largest bank SBI is currently giving loans at 8.50% annual interest.
There is an increasing number of people up to 36 years of age who are taking personal loans for down payment. They are taking home loans up to 90% of the cost of the house. NBFCs are making such offers.
63% of people want to own a house, and before covid, such people were 49%. In the March quarter, 27% of home customers in the age group of 25-35 years took a loan. Before Covid, it was 17%.
Amit Kumar Agarwal, CEO, NoBroker, said, “Generally home loans are for 20 years. During this period, there may also be a period of reduction in rates. Anyway, the repo rate is 6.5% now, while it has been 6-8% on average in the last 10-12 years.