September 11, 2009

Some of the housing finance stocks reacted positively to the Government decision to allow one percentage point interest subvention on housing loans up to Rs 10 lakh.According to analysts, the Rs 1,000 crore-interest subsidy scheme announced by the Government on Thursday would help revive demand for housing loans further.

Under the scheme, the housing finance companies will be compensated upfront for the loss on interest income on loans disbursed in the next 12 months through the National Housing Board.Housing finance stocks had seen their year lows in March when housing loan market had contracted. By the end of May, some of the stocks had, however, witnessed their 52-week highs and some others touched the high points in July.