HDFC Limited is India’s leading mortgage lender and a well established financial conglomerate. It has assisted more than 90 lakh customers in acquiring their own home over the last 44 years. It caters to various towns and cities, with a wide network of 651 interconnected offices, besides meeting the needs of NRIs and PIOs through its offices in London, Dubai and Singapore and service associates in the Middle East .
Renu Sud Karnad , Managing Director, HDFC Limited, Talks about the company’s milestone of home loans worth Rs 2 lakh crore approved during the last about one year period between April 1, 2021 and 21 March, 2022 , corporation’s digital initiatives and its focus on green affordable homes.
Leadership position in housing finance for affordable homes
HDFC continues to have the largest number of home loan customers over 2.7 lakh who have availed benefits under the Pradhan Mantri Awas Yojana’s (PMAY) Credit Linked Subsidy Scheme (CLSS) As on December 31, 2021, cumulative loans disbursed by the corporation under CLSS stood at Rs 45914 crore and the cumulative subsidy amount stood at Rs 6264 crore.For the nine months ended December 21, 2021, 30 percent of home loans approved in volume terms and 13 percent in value terms , have been to customers from economically weaker section (EWS) and low income group (LIG)
Focus on smart green housing
We recognise the growing risks around climate change and see this as an opportunity. At HDFC, we are increasing our footprint in funding affordable , smart and green housing . HDFC has signed an MoU with the Indian Green Building Council (IGBC) to promote and encourage developers to opt for green buildings in India. We also launched green deposits for our retail customers and the funds raised under this product will be deployed towards green and other sustainability initiatives.. We also partnered with IFC to promote Affordable Green Housing Finance for low-income borrowers. IFC’s $ 250 million loan will support its moves to grow affordable housing and emerging green affordable housing portfolio by improving access to such housing for people in low income brackets.
Integrating technologies with digital operations
HDFCs thrust on digital initiatives and inherent demand for housing helped us to get back to normalcy faster than expected and has been instrumental in achieving the Rs two lakh crore home loan milestone. Integrating technologies across business functions, unlocked multiple channels of growth.
We have focused on an online digital platform for loans and retail deposits and initiated ‘HDFC Customer Connect’ for all customer requests and launched virtual offices for customer services. Today, 89 percent of our retail loans are sourced online, up from less than 20 percent before covid-19 pandemic . In the housing finance space HDFC is the first institute to lay emphasis on online loan processing during the lockdown. Further, HDFCs website is now available in seven languages , keeping in mind customers’ comfort while interacting in their language.
Housing demand and new launches matrix
In the past one year, we have seen a strong pipeline of new launches surpassing pre-pandemic levels. The demand for housing continues to be from first time homeowners as well as those moving up the property ladder- generally into larger homes. We are seeing healthy demand across metros and non metros . The demand is also prevalent in affordable as well as high end markets. The sweet spot for housing is still in the Rs 50 lakh to Rs one crore price range.
Affordable housing as residential real estate driver
Affordable housing will continue to be the driving force behind the real estate sector in India. The demand for affordable homes in India is extremely deep and resilient. With more developers transitioning to the mid and affordable segment by providing right priced units which are affordable for end users. The affordable residential real estate segment will continue to see strong traction. The increasing sales momentum and new project launches indicate healthy growth for the housing sector.
On the prospects of housing
The prospects of housing are bright. In over four and a half decades, I have not seen a better time for the housing sector than now due to lower interest rates, stable property prices, government’s trust on affordable housing , and improved affordability. , favourable demographics, increasing urbanisation and rising aspirations. The government’s thrust on housing is a recognition that a rapidly growing country like India with a large young population , needs more houses at affordable price points. This will make more home aspirants , household owners. The CLSS under PMAY, has helped immensely to move towards the goal of “‘ Housing for All’. The residential real estate segment will continue to see strong traction as the demand for housing is not just pent up demand but it is a structural one.