PARSVNATH TO RAISE RS 2,500 CR

Delhi-based Parsvnath Developers has decided to raise up to Rs 2,500 crore through issuance of securities , including Qualified Institutional Placements. The company has the approval of its board of directors. It will now seek permission from shareholders. “We want to raise money to reduce our debt and expedite our ongoing projects in the hospitality and the SEZ segment,” said Pradeep Jain, chairman.

Courtesy:- BS dt:- 24-05-2009

SECTORS TO WATCH OUT FOR

Liquidity-starved sectors such as infrastructure and realty could be the biggest beneficiaries of the vote of confidence for the UPA.
A clear mandate for the United Progressive Alliance and the continuity of the current government's policies are likely to keep the markets buoyant. Marketmen believe that foreign institutional
investors and domestic institutions, which were not participating aggressively in the markets thus far, are likely to invest for the long term, given the stable government at the Centre.

Opening up of the economy, allowing foreign direct investment and easier interest rates should improve liquidity and are expected to help sectors such as infrastructure, banking, India's largest realty companies--DLF and Unitech --have already raised over a billion dollars in the recent past and chances are that others might follow. Nirmal Jain, chairman, India Infoline, said "indications are that formation of a stable government will trigger flow of foreign capital in equity as well as debt. This would mean appreciation of the rupee and revival of liquidity-starved sectors such as real estate."

Analysts now believe that since the UPA can form the government without the support of the Left parties who were opposed to the idea of foreign direct investment, special economic zone projects, which were stalled, could get a fresh lease of life

Courtesy:- BS dt:- 18-05-2009

PLR AND HOME LOAN RATE

The prime lending rate (PLR) maes a

difference to home laon borrowers. Here is how it works to lower your home loan

interest rate

What is PLR?

It is a benchmark rate of interest at which banks lend to their creditworthy

customers. This rate is used as a yardstick to compute inerest rates for other

borrowers.

When does PLR change?

Apart from the bank's ownpolicy, PLR is also dependent on how the Reserve Bank of

India (RBI) toggles its key rates like the cash reserve ratio (CRR) and repo rate.

When the PLR is increased or decreased by the lender, it translates into more or less

outflow for the borrowers

Relation between PLR and home loan

interest rates

PLR is a benchmark that varies from lender to lender. The rate of interest charged by

a bank could be half a percent more tha the benchmark PLR. A cut in the bank's PLR

will reduce the interest burden for borrowers.

Impact of key policy rates on PLR

The RBI toggles its key policy rates to bring certain volatile situations under

control. For instance, the RBI may take measures to draw out excess money from the

system, rein in inflation, invigorate a slumped economy, infuse liquidity or control a

spiraling price rise.

CRR is the portion of funds tat banks have to retain with the RBI. Repo rate is the

rate at which banks borrow money from the RBI. If the RBI reduces the repo rae, it

will be cheaper for banks to borrow money. Lowering the CRR and repo rate will infuse

more liquidity into the system . This could translate into a less expensive cost of

borrowing

Courtesy:- FT dtd:- 29-03-09

PLAN BUDGET TO MAKE BUYING A HOME EASY

Factor in expenses and related costs while drawing up a
budget to buy your dream home. This way the repayment will be comfortable

Despite the gloom of job cuts and possibility of more recession, some people are busy realising their dream home. The mix of lower home loan rates and fall in property prices is infusing life into the real estate market.

Why are home loan rates falling?

The Reserve Bank of India (RBI) toggles key rates to infuse liquidity into the system, drain out excessive liquidity, control forces of inflation, increase economic activity and so on. A few months ago the inflation rate was at its peak. To rein in the soaring inflation umbers, the central bank hiked the cash reserve ratio (CRR) and repo rate. The CRR is the portion of deposits banks must keep aside with the RBI and the repo rate is the rate at which the RBI lends money to banks. Banks in turn hiked the rates and made loans for housing, cars and personal purposes dearer.

However, with the inflation numbers rubbing shoulders with the possibility of deflation, the RBI recently reversed its policy. It has pulled down the key rates to infse liquidity into the system and make borrowing cheaper.

How should you make a budget for a home?

A home is one of the most expensive purchases. And a home loan is a huge debt that the borrower is burdened with for 15 to 20 yeas. Hence, it is critical that you budget for it. Do not indulge in extravagant purchases that you may find hard to repay for. Borrow as little as you possibly can. It is not necessary to take 90 percent of the money from the lender when you can afford to raise some money from other sources. Make arrangements for the required margin money.

After paying your monthly EMIs, you must have sufficient funds to meet your regular monthly expenses, make small savings, set aside emergency funds and plan for long-term expenses. Unless imperative, avoid acquiring new debts.

Floating rate borrowers must keep rate fluctuations in mind before they borrow funds. Borrowing to the brink of your repayment capacity will put you in financial trouble, if rates go up. Keep a cushion that doesn't make your life miserable in case rates go upwards.

How does EMI work?

Equated monthly installments are used to pay both interest and principal each month. At the end of a specified number of years, the loan is repaid in fll. EMI comprises of two components - principal or the actual money borrowed and the interest towards it.

During the initial years of the loan repayment, a bigger chunk goes towards the interest component while the principal amount repaid is much less. Towards the end of the repayment tenure, mostly the principal component gets repaid.

In case of a pure fixed loan, the EMI due to the lender remains constant. In case of a floating rate loan, the EMI moves up or down depending on the bank's benchmark lending rate. When a lender increases the interest rate, either the tenure of the loan is increased (and EMI kpt constant) or EMI is increased (and tenure kept constant).

Planning for other expenses

Apart from making arrangements for down payment of 10 to 15 percent, home buyers incur additional expenses. This includes registration expenses, association funds, maintenance deposits, taxes due to the government, furnishing and woodwork etc.

Planning well ahead keeps you out of financial trouble.

Courtesy:- FT dt:- 05-04-09

BOOKING FOR GULMOHAR WOODS OPEN

Falcon Realty Services Private Limited (FRSPL) opened bookings for Gulmohar Woods, its

affordable housing project with apartments available for as little as Rs 5.5 lakh.

Gulmohar Woods is the first project to be developed s a part of
href="http://www.zameen-zaidad.com/"> Global EcoCity on the NH-8 in Delhi – NCR.

The company has announced a flexible and convenient payment scheme that allows buyers

to pay only Rs 51, 000 at the time of booking.

Spread over 35 acres, Global Eco City has
executive homes, weekend homes, home for

all and premium villas.

Courtesy:- HT dt:-- 04-04-09