The realty sector has seen negative growth, or regression if you prefer, in the last year or two. The reasons are quite obvious. As housing loan rates went up, the demand in this sector went down. And this has forced many investors to hold properties that they had intended to sell off for a profit. On the other hand, many people have been unable to afford a housing loan due to high costs.

But the recent cut in housing loans is intended to give a much needed boost to the housing sector. Hudco, HDFC, Canara Bank, IDBI etc have all introduced or are set to introduce rate cuts for their housing loans. What does this mean to you?

First of all, this means that housing loans will be cheaper. Both the floating and the fixed rate loans will be cheaper by a percent or more. This means your EMIs will come down. You can now afford a bigger loan than what you could have taken six months back.

Another effect this will have on the property market is that the demand for housing will go up. Surely you know what will that mean! Yes, property prices may rise. This means that people who find it hard to afford housing will be back to square one! So if you are eyeing a residential property, NOW is the time. Invest while you can make full use of the rate cuts and (relatively) lower housing prices. This holds especially true for cities like Mumbai and Bangalore where the realty prices are all set to go up as they get their Metro Trains.

You will also be happy to know that the CII has made certain recommendations to the Finance Ministry for boosting investment in the realty sector. One of these recommendations is tax rebates and deductions for people paying off housing loans. Thats just one more reason you should consider investing in property