Friday, June 20, 2008

Sensing a correction in the real estate sector, commercial banks become selective in lending to new residential and commercial real estate projects

Besides increasing the lending rates, some banks have asked the promoters to increase their share in project funding in an attempt to mitigate the associated risks.

The economic uncertainty and runaway inflation is likely to impact the real estate prices, and this is already evident in some pockets in Mumbai. The decline indicates tough times ahead for the real estate industry, according to bankers. Banks have already turned selective in taking up new funding proposals.
Banks Turn Choosy on Realty Loans

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