Momentum is back in the home loan market with offtake picking up faster in the last two quarters of the financial year compared to the first two for the two largest lenders ? HDFC and State Bank of India (SBI). While HDFC is looking at a growth of 20% in the fourth quarter of 2009-10 as well as for the whole of that fiscal, SBI is estimating a growth of 30%, for both the periods.
In a bid to bring more borrowers under its ambit, SBI is looking at giving interesting schemes. ?We are looking at offering attractive interest rate schemes to customers after the review of monetary policy?, a top executive of SBI said.
?During the last two quarters, the conversion rate has gone up and higher number of queries are getting converted to deals,? Renu Sud Karnad, managing director, HDFC, said.
Even though the ticket size of loans varies depending on metros and non metros or semi urban areas, the average ticket size for HDFC is Rs 16 lakh. With HDFC, for tier I cities the loan size is Rs 23 lakh and for tier II cities it is Rs 12 lakh. The range of ticket size of home loans for the public sector bank is varied?while in Mumbai it could be around Rs 25 lakh, for other metros it is around Rs 17 lakh and in remote interiors it could be Rs 3 lakh.
For HDFC, loan approvals during the nine-month period ended December 31, 2009 amounted to Rs 41,110 crore as against Rs 33,820 crore in the corresponding period last year, representing a growth of 22%. Loan disbursements during the nine-month period ended December 31, 2009 amounted to Rs 33,527 crore against Rs 27,211 crore during the corresponding period last year, representing a growth of 23%.
While HDFC has a 40% share in the home loan market, SBI accounts for about 20% to 25%. For SBI, the split between urban and rural areas in value terms is 65:35, while the ratio is just the reverse in volume terms.