Rajan Says Real Estate Reasonable, Let's Not Count Aurangzeb Road and Malabar Hill
Housing data suggests that with 7-8 per cent inflation, prices of real estae are coming down in real terms because wages are going up, Rajan added
Sep 30, 2014
Source : profit.ndtv.com
Raghuram Rajan, RBI Governor


Reserve Bank Governor Raghuram Rajan on Tuesday said property prices in the country are not frothy barring a few pockets.

"Leave aside Aurangzeb Road and Malabar Hill from calculation," he added.

Aurangzeb Road, which is located in Lutyens Delhi, is home to several Indian billionaires like ArcelorMittal's LN Mittal, DLF's KP Singh and Max Healthcare's Analjit Singh.

Similarly, South Mumbai's upscale Malabar Hill hosts several business tycoons and Bollywood superstars. Billionaire investor Rakesh Jhunjhunwala is known to have bought sea-facing apartments in Malabar Hill last year.

Prices of apartments in Malabar Hill are as high as Rs.1.35 lakh per sq feet, making it one of the most expensive neighbourhoods to stay in the world.

Dr Rajan today said that the central bank is not overly concerned with property prices even though the value of real estate appears to be increasing despite a sharp slowdown in the economy.

"The value of real estate will increase in a growing economy, but the housing data suggests that with 7-8 per cent inflation, prices are coming down in real terms because wages are going up," he added.

The flamboyant Governor, credited with bringing back stability to India's financial system, said the high cash component in property transactions offers a good cushion to banks' lending to the sector.

For buying a home, banks extend loan up to 80 per cent of the property's value, while buyers have to contribute the rest, making such transactions safe, he said.

"Loan growth to real estate sector has been strong, but it's still a relatively small portion of banks' overall balance sheet," Dr Rajan added.

In its monetary policy today, the RBI left interest rates unchanged citing high risk to its 2016 inflation target.

Latest Realty News

Govt bought pvt forest, sold it to real estate cartel, says PAC
Sep 30, 2014
The public accounts committee (PAC) of the Goa state legislative assembly 2013-14, has alleged a prima facie fraud in the disposal of six hectares of land
BDA plans revamp to face new challenges
Sep 30, 2014
The Bhubaneswar Development Authority (BDA) is planning a massive shake-up in its manpower and decision-making process to suit its centemporay role
Committee constituted for change of land use
Sep 30, 2014
The Municipal Administration and Urban Development (MA&UD) department has constituted a committee for considering change of land use cases
No-smoking boards must for new public buildings
Sep 30, 2014
The next time you approach the fire and emergency services department to get a no-objection certificate (NoC) for a new building that will house public facilities, make sure 'no-smoking' boards are installed in its key locations
BDA gives sapling work to building agency
Sep 30, 2014
The Bangalore Development Authority (BDA) may claim that it has spent crores on planting saplings across the city, but the Upa Lokayutka has found that the authority entrusted the work to a company that has expertise only in building concrete jungle
NCR flat buyers unite to fight delayed deliveries
Sep 30, 2014
To give impetus to the ongoing struggle to gain ownership of their apartments, homebuyers in Noida, Greater Noida and Gurgaon have joined hands in floating a unified banner called the NCR Flat Buyers Association
PMC seeks legal aid to save land reserved for timber market
Sep 30, 2014
Despite inordinate delay on part of the Pune Municipal Corporation (PMC) to implement all the land reservations earmarked in the 1987 development plan, the standing committee has decided to deploy a battery of lawyers to protect a 57-acre reserved plot on Satara Road from getting converted into a residential zone
City's new development plan to be transport-centric
Sep 30, 2014
Surat Urban Development Authority (SUDA) will adopt a transport-oriented pattern for its new development plan and promote taller buildings
Hyderabad Property Tax to be Revised in 25 New ULBs
Sep 30, 2014
HYDERABAD: Property tax will be revised in the newly-constituted 25 urban local bodies in Telangana with effect from April 1, 2015.
With 100 launches, the great festive real estate show is on
Sep 30, 2014
With more than a hundred launches, across the top real estate markets in Mumbai, Delhi, Bangalore and Pune, and attractively-priced offerings, it could turn out to be a cracker of a Diwali for developers

Latest Realty News Of State

Realty Talk's