State Bank of India signs MoU with Credai
State Bank of India and real estate developers’ body Credai have signed a memorandum of understanding ( MoU) to jointly conduct various initiatives towards development of the realty sector. The MoU will be in force for a period of three years. Each of them will use their individual strengths and collaborate in areas to promote housing for all, which will be beneficial to the sector, SBI said in a statement.
SBI will be a national partner for all Credai activities and both will j ointly work together for various marketing activities. The ticket size of new residential launches across top eight cities has seen an average decline of 14% year – on – year (y-o-y). This was a consequence of many developers recalibrating their market strategies that involved reducing effective cost of their property and restricting the number of new launches in order to reduce their inventory holding, says a new report by Cushman & Wakefield.
In accordance with the market sentiments, the total number of new housing units declined during the year by 11% to approximately 113,000 units. Of this, mid housing segment accounted for 56% of the total unit launches followed by value housing segment at 32%. On a y-o-y basis, value housing segment noted an increase of 22% to more than 36,300 units.
The high-end segment, on the other hand, was impacted the most, wherein launches almost halved to 12,000 units during the year.
In most cities developers have sought to rationalise ticket sizes especially in the high-end and luxury segments, which has been hit the most.
“The government has been resilient in its efforts to create affordable housing and achieve its target of Housing for All by 2022 and is taking steps to build in benefits for developers to participate. Post demonetisation, markets have witnessed a slow uptake of residential properties on account of price and value mismatch. Consequently, developers are also relooking at their strategies to create better value for homebuyers,” says Anshul Jain, managing director, India, Cushman & Wakefield. China has pledged to contain the country’s fast-rising home prices to its annual work report as a red-hot property market resisted cooling measures and purchase restrictions spread out from the biggest cities.
Several lower-tier cities have raised the bar for home purchases this month as speculators from outside flood smaller markets, with home prices nationwide continuing to rise.
The final version of the government work report said “containing excessive home price rises in hot markets” will be a key focus this year, according to a final version of the report released by official state media Xinhua.
The first version of the work report, delivered by premier Li Keqiang on March 5, did not include the phrase.
Home sales surged in the first two months of the year despite government measures, though growth in real estate investment showed signs of easing, according to data released this week.
Lending to households, mostly mortgages, expanded rapidly last year, accounting for 50% of all new loans, and remained high in January. People’s Bank of China (PBOC) Governor Zhou Xiaochuan said last week that measures to cool rising house prices would slow mortgage growth to some degree, though housing loans would continue to grow at a relatively rapid pace.
Several major banks in Beijing have temporarily stopped issuing housing loans since February, financial magazine Caixin said citing bank and property agent sources, though the halt was due to a lack of loan quota, with approval timelines extended but loans still being granted.
China’s state-run banks typically rush to issue loans early in the year to lock-in clients before quotas for lending are exhausted.
The banking regulator and the PBOC have told banks to curtail new mortgage lending, stateowned newspaper Economic Information Daily reported, citing unnamed banking sources.
Caixin cited regulator sources saying that the PBOC was monitoring lending in real time and guiding banks to not allow personal loans to increase too much.