No housing price bubble building up in India: RBI

Ireo Waterfront, located in Ludhiana, Punjab, is a 500 acre township

Ireo Waterfront, located in Ludhiana, Punjab, is a 500 acre township

There is no housing price bubble building up in India, Reserve Bank of India Governor Duvvuri Subbarao said on Monday in a post-policy conference call with analysts.

Subbarao expects liquidity conditions to be less uncomfortable over the next few months due to the winding down of the government’s cash balances as well as the narrowing gap between deposit and credit rates.

He said the central bank’s open market operations (OMOs) were not the preferred tool to inject liquidity, but all options will be used to actively manage the cash situation.

However, Subbarao said liquidity is expected to be in deficit mode over the next few months, and that the central bank would prefer it to be in deficit as there are upside risks to inflation.

In a teleconference with analysts, the central bank chief also said the RBI does not intervene in forex markets to manage liquidity. RBI does not have a target for consumer price index inflation, Subbarao said, but added the central bank considers both wholesale and consumer inflation while framing policies.

Read more: The Economic Times

M&As show India is still hot spot for foreign investors

Despite concerns on the macroeconomic front, it seems like foreign companies are reviving their interest in India. Not only has there been a surge in foreign institutional investors’ interest in India’s equity markets this year, but increasing merger and acquisition deals in India are also reflecting investor optimism.

In the last five months, FIIs have deployed $11.8 billion in Indian equities against $8-6 billion in the year-ago period as reallocation of global funds has helped the Sensex to trade at a forward price earnings multiple of 12.

Even inbound investments into India such as Qatar’s Rs 6,800 crore investments in Bharti Airtel, global consumer-goods giant Unilever’s additional 22.5% stake buy in its Indian unit Hindustan Unilever, Abu Dhabi-based Etihad’s 24 percent buy in Jet Airways and parent GlaxoSmithKline’s $900 million investment in its India-listed subsidiary GlaxoSmithKline Consumer Healthcare suggest that long-term investors are still bullish on India.

Read more: First Post

Real Estate

Real Estate Regulator Bill will see light of the day sooner: RV Verma

Central Registry of Securitisation Asset Reconstruction & Security Interest of India (CERSAI) portal will be open to public view by mid-June, said R V Verma, chairman and managing director of National Housing Bank, a shareholding bank in CERSAI. In an interview with Neelasri Barman he said that they are working to provide a seamless payment gateway system for the individual members of public to enter the site and check on the information relating to the properties they would be transacting in. Excerpts:

The decision on the real estate regulator bill has been deferred by the union cabinet. When can it be expected now?

It’s only a matter of time as this is a critical need and will serve the larger consumer interest and transparency in the sector. This will, in turn, have a number of positive implications including larger flow of funds, better credit availability and lower risk. All this will result in more efficient and transparent pricing and enhanced confidence amongst the lending institutions.

Read more: Business Standard

Infrastructure

Rework on road-widening proposal, RITES told

The officials of Rail India Technical and Economic Services (RITES) Ltd have been asked to rework on their proposal to widen the Ferozepur Road-starting from the Jagraon Bridge till Sidhwan Canal. They have been asked to properly prepare a proposal for the widening of Ferozepur Road and discuss it before May 31.

The team from RITES Ltd was in city today and they held a meeting with Mayor and the MC officials at Zone D office in Sarabha Nagar, here today. The meeting started at 10 am and continued for over four hours (till around 2 pm).

The Ludhiana Municipal Corporation, with the help of RITES Ltd, plans to make Ferozepur Road eight-laned from existing four-lane on priority basis. That is why, for the past some months, officials from RITES are regularly visiting the city. While speaking to The Tribune, Mayor Harcharan Singh Gohalwaria stated that he was not happy with the proposal submitted by RITES. “They should prepare the proposal in a better manner so that the Ferozepur Road can be widened. The kind of proposal they submitted, even our MC engineers can prepare a similar one. As it is RITES, we expect a better proposal from their side,” informed the Mayor.

Read more: Tribune India

Noida plans another bridge over Yamuna to connect with Delhi

With a daily traffic volume of more than 1.5 lakh vehicles proving too much for the two connecting routes between Noida and Delhi, the Noida Authority is looking to construct another six-lane bridge across the Yamuna.

The new bridge, officials said, will run parallel to the Kalindi Kunj bridge near Okhla Barrage and will benefit commuters travelling between Delhi, Noida and Faridabad.

Senior Noida Authority officials confirmed that Pune-based Central Power Water Research Station (CPWRS) has been handed the charge of conducting a feasibility study of the proposed bridge. CPWRS is studying the psite and the final model for the project is expected to be ready in a couple of months.The construction will be completed two years after work begins, officials said.

“During peak hours, there are jams on DND Flyway and Kalindi Kunj bridge. The existing bridge has two lanes on either side, and is clearly insufficient to deal with a traffic volume of close to 1.5 lakh vehicles per day,” an official said.

Read more: Indian Express

Banking

Cheaper ways to cover your loan

When one applies for a loan, he/she is almost immediately offered an insurance policy to cover it. Insurance companies tie up with lenders to offer this product to a borrower, to prevent the family from being burdened in case of an eventuality.

These are called Mortgage Redemption Schemes or Loan Protection Covers. The ones offered by banks typically fall under a group insurance scheme for borrowers of housing or vehicle loans. Mostly, these are single premium term plans. The lender pays the premium to the insurance company as soon as a borrower is sanctioned a loan. And, adds the cost to the borrower’s loan cost, paid in small parts with the equated monthly instalments (EMIs). Such covers offer a sum assured worth the loan amount.

This product is very helpful. However, there can be other options in place of Mortgage Redemption covers.

Says Mumbai-based certified financial planner Pankaj Mathpal, “Buying a (separate) term cover to protect a loan would work out better, even in terms of cost.”

Read more: Business Standard

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