on Apr 23, 2021)Mumbai: Demand for housing has surprised on the upside, however, it is structural and here to stay, said HDFC chairman Deepak Parekh. He said demand for larger homes in alternate locations due to the shift to work-from-home and the PM Awas Yojana, under which over 1 crore homes have been bought, are among major drivers.
“In my 44 years of working in the housing sector, I must say the strong demand that one has seen for housing in the recent period has certainly surprised on the upside. Growth in home loans has been aided by low-interest rates, softer or stable property prices and continued fiscal benefits on home loans,” the head of the country’s largest mortgage lender said.
On the global economy, Parekh said the massive liquidity infusion to deal with the impact of the pandemic has pushed up prices of financial assets. “Governments across the world are conscious that they have to safeguard against any build-up of asset bubbles. That is why several countries are focusing on increasing investments in real assets. Building infrastructure is one way to ensure a sustained recovery, without spiralling inflation. Building infrastructure also creates a massive number of jobs and has multiplier effects on the economy,” said Parekh.
“India sees the benefits of construction-led recovery, which is why the infrastructure outlay in the Budget is at an all-time high. The National Infrastructure Pipeline envisages over 6,500 infrastructure projects with investments of over Rs 111 lakh crore over five years. Resources for this will need to be a combination of public and private investment,” said Parekh.
According to Parekh, the use of technology in the real estate sector will improve governance by enabling real-time data, including the progress of a project on digital dashboards. “Funding for projects based on achieving construction milestones can be better monitored online. This will bring in much-needed transparency and accountability, and improve cost efficiencies in the sector,” he said.
