Female home loan borrowers rose sharply in Tier 3 & 4 districts during 2021-22; here’s why

Female home loan borrowers rose “significantly” in Tier-3 and 4 districts in India during the financial year 2021-22 (FY22), a recent report done by SBI Research on emerging trends in residential housing showed. The report, released on Monday, stated, “Among the top 20 districts with highest share of female borrowers in fresh home loan disbursal in FY22 (which are mostly rural), 6 districts are from Chhattisgarh, 3 from Gujarat and Haryana each.”

These districts have on an average 49 per cent female share in the total population, it added.

In sync, the pace of home loan portfolio and fresh disbursals also grew.

“Total home loan portfolio (outstanding) grew by more than 10 per cent in FY22, with districts in Tie-3 and Tier-4 areas growing at a much faster rate than Tier-1 and Tier-2 districts post-pandemic,” the report mentioned.

The compound annual growth rate (CAGR) of fresh disbursal showed higher growth in Tier-2, Tier-3 and Tier-4 districts, it further underscored.

Tier-2 cities, including Vishakhapatnam, Guwahati, Raipur, Surat, Vadodara, Jaipur, Lucknow, Dehradun, and Tier-3 city Coimbatore have witnessed higher growth in housing prices, the report cited.

What drove the buying interest?

The rising trend of work from home and freelance jobs amid the Covid-19 pandemic drove the higher demand for homes in smaller cities and towns in FY22, the report noted.

It also pointed out that “the increased job opportunities coupled with the lower cost of living had already led many to start shifting their bases away from over-crowded metropolitan cities.”

The Centre’s infrastructure-focused schemes like AMRUT (Atal Mission for Rejuvenation and Urban Transformation) and Smart City projects also helped, the SBI report added.

Metropolitan regions of Delhi (National Capital Region or NCR), Bangalore, Chennai, Hyderabad, Kolkata, Mumbai, Ahmedabad, Pune are considered Tier-1. State capitals and evolving areas are categorised as Tier-2. Rest of the districts are categorised as Tier-3 and 4 based on their urban population.