Realty stocks were trading with healthy gains, keeping their sectoral index aloft in the afternoon trade on September 22.
The Nifty realty index jumped over 5 percent in intraday trade, with stocks such as DLF, Hemisphere Properties and Indiabulls Real Estate jumping in the range of 5-9 percent.
In the previous session, the realty index had jumped 3.6 percent. Realty stocks have been enjoying a bull run this year, with the pack jumping 34 percent year-to-date against a 26 percent rise in the Nifty.
Low-interest rates and hopes of a faster economic recovery in the post-pandemic world seem to have boosted realty stocks. Besides, the rebate on stamp duty in some states has also supported realty players.
“The realty index has been bullish in the recent past as the interest has been low and the supportive government policies. The technological advancements in the sector have also been one of the reasons that have led to the bullish movements,” said Ashis Biswas, Head of Technical Research at CapitalVia Global Research.
On September 21, Housing Development Finance Corporation (HDFC) said it will offer home loans at 6.7 percent as part of a festive offer, joining a bunch of mortgage lenders that have cut interest rates to perk up demand.
These steps are also seen as positive for the realty sector.
Also read: Karnataka government slashes stamp duty on housing units priced below ₹45 lakh
The upcoming festive season has seen major players such as State Bank of India, Kotak Mahindra Bank and Punjab National Bank lowering their rates. “This is expected to have a positive impact on the realty sector as with the reduced interest rates it can be expected that there will be more interest in the borrowers,” said Vishal Balabhadruni, Banking Analyst at CapitalVia Global Research.
“Moreover, since the offer is irrespective of the loan amount or employment category, we expect more traction and the positive impact on the beneficiary i.e. realty sector.”
Also read: Low-interest rates to boost housing sales, benefit affordable & mid-segment homebuyers: Experts
The Nifty realty index was 5.30 percent up at 441.35 at 1215 hours, with all components in the green. Shares of DLF were up 9 percent, while those of Indiabulls Real Estate were up 8 percent at that time.
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