Union Development Minister Favours Cheap Home Loan Rates

June 29, 2009: In order to revive the demand in the real estate sector, Urban Development Minister Jaipal Reddy today favoured cheaper loans for buying houses. "Real estate is facing a slowdown. So, we should make an arrangement for giving loans at 6.5 per cent for houses in the below Rs 5-lakh category to the poor," he said after his meeting with Finance Minister Pranab Mukherjee here. "It was a pre-Budget meeting and we discussed budgetary issues with the finance minister," he told reporters. Reddy suggested extension of housing loan at 7.5 per cent presently available for flats up to Rs 20 lakh to those priced at Rs 30 lakh in cities.

"The revival of real estate is the key for generating employment. The existing 7.5 per cent interest scheme should also be extended beyond June to motivate more buyers," he said. Reddy sought more budgetary allocations for Commonwealth Games projects, DMRC extension and JNNURM projects. "Keeping the ongoing Games projects in mind, we have sought more budgetary provisions," he said, adding that more funds for Delhi Metro extension programmes were also sought. "Our JNNURM programme is the most successful one and now, more and more states are seeking projects under the scheme. So we have asked for more budgetary allocations for it," he said.