Housing Finance by Commercial Banks : A Comparative Study

Abstract

Today, there is a wide spread growth in the demand for recognition of housing as a basic human right. Housing is intimately connected with access to livelihood. Once a person’s livelihood ensures a stable minimum level of income, access to land, infrastructure, materials and welfare of the family can quickly follow. Housing is also a dynamic process not limited to one time provision of shelter but a complex system of linkages between the family, community and the larger economic and ecological environment. Thus, shelter is a basic need of human beings. Indeed, it is essential that there should be residential privacy and other essential facilities if the dignity of the individual and life of the family to be preserved. Housing is a corner stone for economic growth. It certainly has potential to kick-start the economy. On account of this chain of back ward and forward linkage with other sectors of economy fueling the growth of over 250 ancillary industries such as Steel, Cement, Timber, Building industries especially where employment is more than the capital, there always exist a positive reality between the growth of housing and its associates. It ultimately results in increase in demand for many industries and hence increases in GDP. All the developing or developed countries give top priority to housing its people. In fact, housing provides necessary impetus to the economy as a whole. A small initiative in housing will propel multiplier effects in the economy as a whole. Housing sector is recognized as major generator of employment. Thus, it results in increase of the real purchasing power of the economy, which will result in growth of many industries such as consumer durables, watches, cycles etc. according to National Building Organization (NBO), two million housing units per year will lead to creation of an additional 10 million man years of indirect employment.