Readings: Office space oversupply, Below 20L home loans, Realty stocks
For the first time since 2004, Noida has recorded a high vacancy level of 26.2% for its Grade A commercial buildings, or top-end office space, in the first quarter of 2007. This is a sharp jump from the vacancy level of 6% in the fourth quarter of 2006.
Some real-estate developers are also withholding space as they prefer to lease the development to a single tenant rather than multiple tenants.
- Economic Times: Below Rs 20-lakh home loans wait for lower interest
Banks do not appear inclined to take a cue from RBI on reducing interest rates for home loans below Rs 20 lakh. Instead, they are raising interest rates on loans above Rs 20 lakh in the housing sector.
A senior bank official which raised rates, instead of passing the benefit to customers, justify their stand saying, “The move to lower risk weightage frees bank’s capital that can then be used to increase lending or reduce lending rates for existing customers. We have decided to lend more.
Defeats the RBI’s purpose, doesn’t it?
- Business Standard: Realty scrips see sharp spike
Their business environment might be worsening by the day, yet stocks of realty companies rose sharply last week, in sharp contrast to their performance over the past three months. Stock market analysts and developers alike are at a loss to explain the sudden rise.
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