Real state business in India is growing at steady rate from past few years. Although the real state business is over from speculators point of view but, it is great deal for small & big housing finance companies (HFC’s). Despite a drop in big loan noted in past few years, real state housing companies gaining momentum in small loans across the country which is the preferred segment as compare to corporate & institutional loans.

Recent trends suggest that real state business is growing in terms of actual users, or people who are going to live in them. With the ever changing market, HFC’s are also re-arranging their strategies. For ex-GIC which is much focusing on the user line which offer loan between the ranges of 3-5 lakh. SBI home finance is also not far behind in this area. According to his survey, lower rate flats now have a big growth area in most parts of India especially in prime parts of Bangalore. Average flats rates vary in this area from 5 to 7 lakh.

Along with small ticket loans, indivisual have become a major focus area for all HFC’s. As in recent survey, more people are from middle or lower organization, so all HFC’s are more interested to cater them instead of higher clients. With the popularity of real state business more & more companies are entering to this business. GICFC & LICFC are the best example of this. SBI home finance is having an interesting case in point where ratio of individual to corporate has reversed.

According to the survey conducted by the India market research bureau (IMRB), most graduates in the range of 10000-15000, have a great response as compare to other high profile graduates.

Bangalore has now become a favorite choice of people from all over the India & world. So naturally Bangalore has a real choice for real state. Real-estate Mutual Funds (REMFs), or Real-estate Investment Trusts (REITs), are all set to enter the country to cash the booming real-estate business and make available large funds for investment in housing related projects. The plan to set up these trusts has been outlined under the National Housing & Habitate Policy, 2005.

After the induction of Foreign Direct Investments (FDI) in property, there has been a sudden spurt in foreign construction and housing groups taking up projects in India. This is the first

time when foreign investors are queuing to be part of real state sector in India. Well induction of foreign investors in real state is indeed sudden. After India started liberalizing its economy, it resists allowing FDI in the real state market.

In real state business, most HFC’s are making profit, though they have a long chain of corporate clients but they are focusing on mid level clients to make more profit in real state business. We have several examples which making profit in this business despite they are having loss in the last fiscal year. One such example is of Bakeri group, the group, which witnessed businesses of around Rs 25 crore in the last fiscal, is aiming for a 10 per cent growth in the current year.

For user point of view it is his right to select the right HFC while offering some loans for real state. Selection of any HFC depends on various factors including rate of interest, national presence, Prepayment/Foreclosure benefits etc. Many people choose brands names rather than going for what is best for him. So during selection of right HFC, make a list of requirements and select the right HFC which best suited to your requirements. Talk to person who already taken a loan from a reputed HFC & get his/her feedback.

Other factors such as documentation, processing fees, time taken in processing the loan should also be considered. In general practice most HFC’s are taking the process seriously as they are well aware of the fact that individuals do not like it if the documentation is an irksome process.

With the establishment of real state business I India especially in Bangalore, more and more HFC’s are taking a serious part in this business and offering valuable services to their customers. If you are planning to take a housing loan in Bangalore then it is advisable to select the right HFC for you after evaluating their facility and their presence.