Hyderabad: Aadhar Housing Finance (AHF), which is into lending small loans in the housing segment, is hoping to disburse Rs 800 crore in Telangana and Andhra Pradesh in 2018-19, up from Rs 325 crore given during 2017-18 even as it plans to expand the number of branches in the two States to 41 from the current 35, said Deo Shankar Tripathi, Managing Director and Chief Executive Officer.
Its current loanbook in the two States is about Rs 680 crore and the lender is hoping that this would grow to about 1,200 crore on increased demand for smaller loans.
AHF is promoted by Dewan Housing Finance Limited (DHFL) group with equity participation from International Finance Corporation (IFC), a member of the World Bank Group.
AHF has seen 85 per cent growth in TS and AP and about 60 per cent in other States. The housing loan requirement in both the States could grow to Rs 15,000 crore next financial from the earlier Rs 12,000 crore.
The real estate in Telangana and AP has been on the upswing from the last two years and the demand for housing finance is on the rise, he said about the reasons that will bring growth.
“The definition of affordable housing is changing. These days, units priced around Rs 25-30 lakh are seen as affordable housing. However, there are many people who want loans less than Rs 10 lakh and who are eligible for the subsidy under the PMAY. This segment is our focus area,” he said adding that it will look to tap low income segment as well as the self-employed.
The average loan size in the State has been around Rs 9.5 lakh, slightly more than the pan-India average of Rs 8.5 lakh. Construction accounts for about 45 per cent of the loans, home improvement ten per cent and purchase of residential units account for the rest, he said.
AHF lends at nine per cent to 12.5 per cent. The interest rates come down to 8.36 per cent to 9.5 per cent in cases where National Housing Bank refinances the loans, he said.
On RERA and GST, he said they are positive for the real estate sector. The GST will not result in prices getting affected drastically as the developers will get input credit, which will offset the around 12 per cent GST (8 per cent for affordable houses) to an extent.