38 billion 63 crore 21 lakh rupees investment in residential loans

Personal residential loans have significantly increased in the first nine months of the current fiscal year. According to data from the central bank, banks have invested NPR 38.63 billion in personal residential loans up to NPR 20 million in these nine months. In the previous fiscal year 2079/80, only NPR 10.32 billion was disbursed in such loans.

Central Bank Policies

To encourage investment in the real estate sector, the central bank has gradually eased its monetary policy:

- Monetary Policy: The loan limit for residential loans was increased from NPR 15 million to NPR 20 million.

- First Quarter Review: The risk weight for loans above NPR 5 million was reduced to 125%.

- Third Quarter Review: Loans can be obtained with the condition that up to 70% of income can be used for installment payments. This is based on the submission of tax clearance certificates.

Interest Rates and Liquidity

- Interest Rates: The current low-interest rates are expected to encourage those who want to take home loans.

- Liquidity: Despite the banks and financial institutions having high liquidity, there is a slowdown in loan disbursement.

Decline in Real Estate Transactions

- In Baisakh: There were 49,782 real estate transactions across the country.

- In Chaitra: There were 50,252 real estate transactions.

This data shows a decline in real estate transactions from Chaitra to Baisakh. The impact of the monetary policy review in the first week of Jestha is yet to be seen.

Central Bank's Perspective

Gurup Paudel, Executive Director of the central bank, stated that the real estate sector accounts for 67% of total collateral and a large portion of fixed assets. The sluggish real estate sector has created problems in the economy. Making this sector dynamic is expected to revitalize the overall economy.

In summary, while loan disbursement in the real estate sector has increased, it has not expanded aggressively. However, it plays a crucial role in stimulating the economy.