Demand for Housing set to grow: NIBM
Source: The Financial Express
At least 68 million Indians will require independent housing by 2015 and add to the housing demand of nation due to age-demographic effect. Inthecase of urbanpopu-lation, the additional need for housing would be 31 million, a report on the 'Study of Residential Housing Demand in India prepared by the Nation-al Institute of Bank Management (NIBM) for National Housing Bank (NHB) said.
NIBM has forecasted additional demandforhousingfor 2012-13 at around 6.79 million, a figure that has been projected by the 11th Planning Commission. Studying the linkages between housing demand and other sectors like steel and cement production, NIBM has estimated a 10 % increase in realised demand for houses (proxied by number of loans disbursed by HFCs and banks) resulting in a 4.59 % increase in steel produc-tionand 4.67% in cement production.
A typical borrower, according to the study, would most likely to be a male in the age group of 40-50, a significant 25% were below 35 years of age. There is a falling trend in the average age profile of those purchasing houses. . Urban citizens have a greater demand for bigger houses in comparison to their suburban counterparts and the demand for houses in terms of size in the rural area is lesser than the population in suburban areas, the study said.
Studying the risk analysis in housing, the sti dy found that when the ;i;:e of the house increased, the risk of default was lower, the monthly income was higher which thereby lowered the chance of defaulting in payments. The security value as proportional to the original loan amount was an important determinant or risk of defaults in housing loans. The study also maintained thathigherthe security margin available to the bank, lower was the chance of defaults in home loans. The likelihood of defaults in housing loans decreased significantly with the presence of additional collateral and the presence of more number of co-borrowers reduced the risk of defaults, the study concluded.
At least 68 million Indians will require independent housing by 2015 and add to the housing demand of nation due to age-demographic effect. Inthecase of urbanpopu-lation, the additional need for housing would be 31 million, a report on the 'Study of Residential Housing Demand in India prepared by the Nation-al Institute of Bank Management (NIBM) for National Housing Bank (NHB) said.
NIBM has forecasted additional demandforhousingfor 2012-13 at around 6.79 million, a figure that has been projected by the 11th Planning Commission. Studying the linkages between housing demand and other sectors like steel and cement production, NIBM has estimated a 10 % increase in realised demand for houses (proxied by number of loans disbursed by HFCs and banks) resulting in a 4.59 % increase in steel produc-tionand 4.67% in cement production.
A typical borrower, according to the study, would most likely to be a male in the age group of 40-50, a significant 25% were below 35 years of age. There is a falling trend in the average age profile of those purchasing houses. . Urban citizens have a greater demand for bigger houses in comparison to their suburban counterparts and the demand for houses in terms of size in the rural area is lesser than the population in suburban areas, the study said.
Studying the risk analysis in housing, the sti dy found that when the ;i;:e of the house increased, the risk of default was lower, the monthly income was higher which thereby lowered the chance of defaulting in payments. The security value as proportional to the original loan amount was an important determinant or risk of defaults in housing loans. The study also maintained thathigherthe security margin available to the bank, lower was the chance of defaults in home loans. The likelihood of defaults in housing loans decreased significantly with the presence of additional collateral and the presence of more number of co-borrowers reduced the risk of defaults, the study concluded.
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