Demand for mortgages improving on favourable market conditions

New Delhi, Nov 27 : Though Covid-19-induced lockdowns significantly affected retail and SME balance sheets, some factors such as aggressive discounting by developers, reduction in stamp duty and low interest rates resulted in a gradual surge in demand for mortgages, brokerages said on Friday.
According to a report by Emkay Global Financial Services, though the growth trend for mortgage business has moderated, it is improving as the pandemic affected economy returns back to normalcy.
The overall mortgage portfolios (housing and loan against property or LAP) of large banks and housing finance companies (HFCs) grew 7 per cent YoY and 3 per cent year to date (YTD) in the April-September period of current year.
The growth has been led by banks with 4.7 per cent YTD growth, while HFCs saw 2.5 per cent growth YTD.
HFCs have continued to lose market share, however, the pace of loss has eased, with the overall share at 36.2 per cent in September 2020 against 36.7 per cent in March 2020.
Among the HFCs, HDFC stands out with a steady share of 17 per cent, whereas LICHF lost 30bps share YTD to 9.9 per cent. Surprisingly, SBI witnessed a consolidation with 23.5 per cent in September against 23.8 per cent in March, whereas ICICI Bank has seen significant growth with market share rising to 11 per cent from 10.4 per cent in March.