Supported by the Centre’s flagship credit-linked subsidy scheme, Pradhan Mantri Awas Yojana (PMAY) and incentives provided to developers, demand for affordable housing across the country remains enormously strong despite a slowdown in overall consumption, said Deepak Parekh, chairman, Housing Development Finance Corporation (HDFC), on Friday at the company’s annual general meeting (AGM).
The upper middle segment and high-end luxury housing - where the prices of apartments are typically upwards of Rs 2 crore - are the segments where unsold inventory levels are high.
The problem of high inventory in the luxury segment was compounded with the tight liquidity situation that prevailed after September 2018 and particularly took a toll on non-banking finance companies (NBFCs) and housing finance companies (HFCs).
Most of these firms are finding it difficult to raise funds because banks are reluctant to lend and have turned risk-averse in spite of adequate liquidity in the system, Parekh said.
Although a few high-rated NBFCs and HFCs have access to funding, for several others, access to credit has been choked.
As a result, a number of them have curtailed disbursements and this in turn has had spillover effects into a number of other sectors, he added.
When asked about the company’s plans for masala bonds issuances, Parekh said that the company has tried getting funds from offshore investors but due to the high volatility in the movements of the rupee, they are not getting good quotes.
The company remains steadfast in its commitment towards supporting 'housing for all' and continues to pursue efforts towards lending to the economically weaker section.
HDFC has crossed the mark of one lakh beneficiaries under the PMAY. Approximately 8,600 loans on a monthly basis have been given to the economically weaker section and lower income group, Parekh said.
On a pan-India basis, the average size of individual loans stood at Rs 27 lakh, he added.