Gujarat's housing loan disbursals surge 60% to Rs 420 billion in a year

In Gujarat, many people are realising their dream of becoming homeowners. It is observed that despite the increase in property prices and interest rates, there has been a 60% surge in housing finance disbursals during the fiscal year 2023 compared to the previous year, FY 2022. According to data provided by the State Level Bankers' Committee (SLBC), fresh home loan disbursals reached Rs 420.48 billion in the fiscal year, which is a significant increase from Rs 262.99 billion in the previous year. The report also highlights a substantial rise in the number of beneficiaries receiving fresh home loan disbursals. The number increased from 2.73 lakh to 4.26 lakh, representing a 56% increase. Bankers and developers attribute the growth in home sales to customers' desire for home upgrades and the overall positive sentiment prevailing in the real estate sector. There has been an upswing in investment in real estate, and new projects are being launched to meet the growing demand. Since the lockdown, people have realised the importance of owning a new home or an additional property, which has significantly boosted the inclination to purchase new homes. Moreover, the demand for home loans has increased due to more people buying second homes. Bankers also acknowledge an increase in home loan applications from young buyers. Ahmedabad is now home to a significant number of young professionals with substantial disposable income. These customers, especially salaried professionals, often invest in new homes for the purpose of tax savings. As a result, they frequently opt for home loans to save taxes, which further drives the demand. Over the past year, property prices in different parts of Ahmedabad have escalated by 10-15%. In April 2022, the Confederation of Real Estate Developers' Association of India (Credai) Ahmedabad chapter announced an increase of Rs 400-500 per sq ft in Ahmedabad, followed by similar increases by developers in other parts of the state. Developers also attribute the surge in home demand to increased migration to Ahmedabad and the growing desire for new homes since the Covid-19 pandemic. Residents of Ahmedabad, Gandhinagar, Vadodara, and Surat are increasingly seeking an improved lifestyle by transitioning to larger, more spacious homes with better amenities. Consequently, there is strong demand for high-end properties across all major cities in the state. Developers are developing new projects with enhanced amenities such as swimming pools, gyms, and jogging parks, further driving the demand. Also read: Delhi civic body launches mobile app for geo-tagging CM inaugurates Itanagar Municipal Corporation’s new building