Surge in housing loans
Low interest regime helps many:
The housing loan interest rate which was reduced last October has
fuelled growth in the lending market.
The reduction of interest rate over time has increased the demand for
The HDFC has provided over Rs one billion worth housing loans for
Government servants recording an increase in the demand, Housing
Development and Finance Corporation General Manager/ Chief Executive
Officer Suresh Amerasekera told Daily News Business.
The HDFC has reduced interest rates in keeping with the low interest
regime though its savings base is relatively small.
“The loan process has been simplified to enable an efficient service
to customers thereby creating a pleasant relationship between the
customer and HDFC,” he said.
“We have ventured in to new areas with branch expansion giving access
to a wider section of customers to borrow. There is an increase in the
demand for housing loans with the reduction of housing loan interest
rates,” he said.
People’s Bank Deputy General Manager (Domestic Credit) K.B. Rajapakse
said there is substantial demand for housing loans since the interest
rate reduction. The bank has expedited the loan process to benefit
The bank has provided loans amounting to Rs 13 billion under the
housing loan scheme for Government servants. It also has different other
housing loan schemes for customers and the response is encouraging, he
A Bank of Ceylon senior official said the demand for housing loans is
high especially for loans below Rs 5 million. “We see an increase in the
loans to purchase apartments,” he said.
Hatton National Bank Personal Financial Services AGM P. Sridharan
said the housing loan market is improving and this is a good sign. An
increase could be seen for the last two to three months as banks have
reduced interest rates drastically.
The high demand is not only from Colombo and greater Colombo areas,
but also from outstations. Housing construction is heading for a good
future, Sridharan said.
The NDB Home Loan and Retail Credit Head Delrene Seneviratne said
that the housing loan market has woken up as upto last year the market
“The demand is picking up steadily and it is moving towards a steady
growth overcoming market uncertainty,” she said.
“Construction of a house is a single largest investment in a life
time. The country is settling down. People are ready to invest in
housing. They are optimistic and positive about the future,” she said.