Housing demand up in tier-2, tier-3 cities

Hyderabad: After the Covid-19 hit India, the real estate sector was badly affected in the initial stages due to lockdowns and other restrictions, but it has witnessed a positive impact later on. Real estate rebound is happening across all major cities in the country. Now, these vibes are spreading across tier-2 and tier-3 cities also.

The pandemic has supported the growth of the realty sector in major markets. Metrocities have seen better opportunities with the work-from-home (WFH) culture.People wanted to own independent houses and bigger living spaces. The WFH option has made several homebuyers to focuson larger units. Those, who were living in 2BHK, shifted to 3BHK houses.

The WFH concept has not only led to the growth of the real estate sector incities like Hyderabad and Bengaluru, but also the adjacent towns and semi-urban regions. Particularly, the tier-2 and tier-3 cities have seen faster real estate growth during the post-pandemic period, says ChallaSreenivasuluSetty, MD (Retail and Digital Banking) ofState Bank of India (SBI).

The leading public sector is moving towards 100 per cent digitisation throughYono appand other digital platforms to cater the needs of home loans across all towns and villages. There is no need to go to any branch of the bank to get a home loan. The loan processing is simplified with thecentral processing centres (CPCs). The idea is to offer instantly on their digital platform.

Even the home loan sales team could give in-principle sanction at the customer's place. They will know the eligibility and rate of interest instantly. Using Yono app, the customer can select one of the approved projects listed on the platform and apply digitally to know the loan eligibility in a complete digital process.

The Mumbai-headquartered bank offers instant home loans on its online platform depending on credit score.At present, 20 per cent of its home loans are being initiated virtually. The customer's home loan application will reach to these CPCs, where the loan gets sanctioned and documentation is done. The loan amount is disbursed from the nearest branch.

SBI team will inform the customer as well as the builder through e-mails and messages. The home loan file details can be tracked online by both of them."We are trying to sanction the loan within five days of application for an approved project on our digital platform. For non-approved projects, the turnaround time may be around 15 days," the MD of the bank informed.

He further said, "The bank currently has 220 CPCs at major cities in India. With the growing demand for home loans in the tier-2 and tier-3 cities, we are planning to set up another 150 CPCs across the country. We are trying to set up at least one CPC in each districtheadquarters of Telangana."

"Almost 95 per cent our home loan customers are first time home buyers,mostly from middle-class and above middle-class categories. The average loan size is around Rs 32-35 lakh. We also cater to the luxury segment, but our focus remains on affordable housing. Our interest rates start from as low as 6.75 per cent depending on their Cibil score," saysSreenivasuluSetty.

"The ideal Cibil score is in between 650-850. We will consider even those, who don't have a Cibil score also, based on their income statement and their property value. Along with municipal approvals, the home buyers are looking for the projectsapproved by SBI. We are building such a level of trust among the buyers," he added.

SBI's home loan segment is witnessing 10-11 per cent annual growth rate. The bank'shome loan portfoliohas gone up from Rs 5 lakh crore to Rs 5.44 lakh crore during last six months. The portfolio will reach Rs 5.70 lakh crore by the end of this fiscal. The bank has set a target to achieve Rs 7 lakh crore in this segment by March 2023.