Page 254 - NHB AR 2020-21-3 complete- Print (1)
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Taking into view the growth in the housing finance portfolio, it was noted that there is a huge
opportunity for growth in affordable housing portfolio. The affordable housing segment,
is largely catered by HFCs who have developed their own internal models to assess the
repayment capability of the borrowers, given the lack of formal income proofs. Further, the
migration of people to their hometowns in Tier 2 and Tier 3 cities due to the current pandemic
is expected to create huge demand for affordable housing in such cities. Such opportunities,
if capitalised may lead to expansion in the market share of HFCs and increase the market
confidence in their favour while also ensuring favourable growth in the housing and housing
finance sector.
Further, the Study also analysed the liquidity measures by RBI along with NHB refinance to
HFCs which led to lowering of borrowing costs and a significant liquidity surplus which was
ultimately passed on to the borrower. The Study felt that the following steps would lead to
full housing market recovery:
a) The Government of India support to Micro, Small and Medium enterprises through
Aatmanirbhar Bharat Abhiyan related economic package would facilitate revitalizing the
manufacturing sector, decrease India’s dependence and increase employment generation
and an enhanced demand in Tier 2 and Tier 3 cities or in Special Economic Zones for both
commercial and residential real estate.
b) The Special Refinance Scheme and Additional Special Refinance Scheme of NHB infused
liquidity to the HFCs especially those in the affordable housing segment. It has helped
them in restructuring of existing loans and existing repayment and in retaining the asset
quality.
c) The promotion of the Affordable Rental Housing Scheme for migrant workers and urban
poor who suffered tremendously due to poor housing facilities during COVID-19 will
increase availability of low cost organized housing with better health and hygiene facilities.
d) Extension of CLSS for the Middle-income groups coupled with lower rates of interest
and consolidation of savings helped us to see better consumer sentiments during the last
quarter of FY 2020-21. This has led to a boost in demand, mainly in affordable and mid
segments. This demand is likely to remain especially with the builders and developers
coming out with new affordable housing projects, with lowering of stamp duty by certain
States Governments and Central Government support in form of tax and other incentives.
234 | Annual Report 2020-21
opportunity for growth in affordable housing portfolio. The affordable housing segment,
is largely catered by HFCs who have developed their own internal models to assess the
repayment capability of the borrowers, given the lack of formal income proofs. Further, the
migration of people to their hometowns in Tier 2 and Tier 3 cities due to the current pandemic
is expected to create huge demand for affordable housing in such cities. Such opportunities,
if capitalised may lead to expansion in the market share of HFCs and increase the market
confidence in their favour while also ensuring favourable growth in the housing and housing
finance sector.
Further, the Study also analysed the liquidity measures by RBI along with NHB refinance to
HFCs which led to lowering of borrowing costs and a significant liquidity surplus which was
ultimately passed on to the borrower. The Study felt that the following steps would lead to
full housing market recovery:
a) The Government of India support to Micro, Small and Medium enterprises through
Aatmanirbhar Bharat Abhiyan related economic package would facilitate revitalizing the
manufacturing sector, decrease India’s dependence and increase employment generation
and an enhanced demand in Tier 2 and Tier 3 cities or in Special Economic Zones for both
commercial and residential real estate.
b) The Special Refinance Scheme and Additional Special Refinance Scheme of NHB infused
liquidity to the HFCs especially those in the affordable housing segment. It has helped
them in restructuring of existing loans and existing repayment and in retaining the asset
quality.
c) The promotion of the Affordable Rental Housing Scheme for migrant workers and urban
poor who suffered tremendously due to poor housing facilities during COVID-19 will
increase availability of low cost organized housing with better health and hygiene facilities.
d) Extension of CLSS for the Middle-income groups coupled with lower rates of interest
and consolidation of savings helped us to see better consumer sentiments during the last
quarter of FY 2020-21. This has led to a boost in demand, mainly in affordable and mid
segments. This demand is likely to remain especially with the builders and developers
coming out with new affordable housing projects, with lowering of stamp duty by certain
States Governments and Central Government support in form of tax and other incentives.
234 | Annual Report 2020-21
