Ernst Publishing adds Mike Fletcher for ‘key’ position

Ernst Publishing Company, a technology provider and closing cost data for the real estate and home finance industries announced recently Mike Fletcher joined the company as its director of strategic accounts.

Fletchers new role includes focusing specifically on solutions for large lenders including the addition of new partners and strategic alliances.

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Buy Repco Home; target of Rs 790: Edelweiss

Edelweisss research report on Repco Home

Repco Home Finances (RHF) Q3FY16 PAT of INR386mn (up 26% YoY) was higher than our estimate on controlled opex and lower provisions (drop in coverage ratio). Business momentum continued to be on track with disbursements moving up gt;25% YoY to INR6bn and loan book spurting 30% to INR71.3bn a reflection of its niche positioning both in customer segments and geography. GNPLs inched up to INR1.6bn (2.3% versus 1.8% in Q2FY16), more of a seasonal trend, though the rise seems to be on the higher side due to the Chennai floods. Niche positioning underpinned by sufficient CRAR of ~24% will sustain RHFs loan CAGR of ~27% and help it post impressive ~25% earnings CAGR (despite DTL) over FY16-18E, with 2.2% RoA and 19% RoE. We roll forward to FY18E and maintain lsquo;BUY with TP of INR790.

RHF operates in a niche segment, which is under-served by banks and larger housing finance companies (HFCs). In this backdrop, we expect the company to be key beneficiary of growth opportunities in the mortgage finance sector, particularly in nonsalaried segment and tier II/III locations. The stock is trading at 3x FY18E P/ABV and 16x FY18E P/E. We retain lsquo;BUY/SO with TP of INR790.

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Islamic finance fast becoming first choice for home loans in Gulf

The growing popularity of Islamic finance and their nature of being asset-back investments have made it a popular choice for home financing for both Muslim and non-Muslim property buyers, particularly in the Gulf Cooperation Council countries. In the recent past, the Islamic finance industry has caught up rapidly and has been working on developing products that challenge conventional home loans in terms of product characteristics and flexibility and, of course, the ethical aspect.
In Qatar, meanwhile all four Islamic banks – namely Barwa Bank, Masraf Al Rayan, Qatar Islamic Bank and Qatar International Islamic Bank – are offering a variety of Shariah-compliant home loans for nationals and expats.
Islamic banks are already at par with their conventional counterparts in terms of products, flexibility and penetration. Since mortgages have a tangible underlying asset, they work well with Islamic financing, Ashar Nazim, partner at Bahrain-based Global Islamic Banking Centre of consultancy EY, told Gulf Times.
There are multiple options on offer including Musharaka – [partnership] and Ijara – [leasing] based contracts, he added.
To acknowledge the advantages of Islamic home financing, the fundamental differences between Shariah-based financing and conventional mortgages or home loans need to be understood. It is true that both differ little in terms of profit rates and interest rates, respectively, which is clear because they operate on the same market, need to be competitive and need to rule out arbitrage opportunities because having a lower price for Islamic money than for conventional money would distort the financial system and damage the entire finance sector.
The basic difference is the absence of interest in Islamic finance as it does not levy interest in any forms, but involves risk and profit sharing over an asset, in this case a property. The ethical component, apart from the absence of riba (interest), is that Islamic lenders do not solely look at earning profits but also grant loans for the interest and growth of the community, while conventional banks simply want to earn money from compound interest.
This has critical implications on home financing, for example in case a borrower runs into difficulties repaying his instalments. Islamic banks do actually buy the property and lease it out to their client until it is paid off at pre-agreed leasing rates that include a profit for the bank. Given that conventional lenders are driven to make money on compound interest, they often are not financially incentivised to prevent home owners from a foreclosure when they default on their payments.
Islamic banks, in turn, are much less likely to pursue foreclosures as they own the property anyway, but tend to seek joint solutions with the borrower. That way, experts think that the sale of and speculation with mortgage-backed securities that have been singled out as the culprit for the severe economic turmoil in 2008 wouldnt have been possible in an Islamic finance environment.
Adding to that, there is no uncertainty over the amount of recurring payments in Islamic finance contracts even over the long term which gives clients peace of mind.
For example, the profit amount or rate is clearly spelt out in the agreements and does not change unless both parties agree to amend it. This has proven rather advantageous especially for clients who had taken under-construction finance from the bank and even though the deliveries of the units were delayed, the profit amounts that they had to pay after years of delay were in line with what was agreed at the time of contract signing, says Pawan Dhawan, head of home finance at Dubai-based Noor Bank.
Islamic finance assets in Qatar, of which a sizeable part are property and real estate, as of 2014 were at about $72bn, up from $56bn at the end of 2013, and are expected to reach more than $150bn by 2018.

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Winter is a Great Time for Garden Prep

What is an avid gardener to do in the dead of winter, when its cold, wet, and most plants are asleep? Here are a few ideas for outdoor and indoor activities that will help you plan and prepare for spring:

Continue Leaf Litter Cleanup.   While fallen leaves are a great compost material, a solid, wet, airless mass of whole leaves on top of garden soil may be a breeding ground for disease. If you want to protect plant roots from frost, classic mulching material such as wood chips may be a better choice. Put the undecomposed leaf litter in your compost pile.

Start Composting!   Making your own soil is a magical thing. And there is a composting method for everyone, whether you opt for a small, convenient plastic tumbler just outside your kitchen door or go big-time with a large outdoor system. For a basic primer on composting, visit this Central Sierra Master Gardener web page:

Prune While Plants Are Asleep.   Winter is the dormant season for most trees, shrubs and perennials, so this is the time to trim or prune. The University of California Cooperative Extension has a number of helpful pruning guidelines on its website: Our local UCCE Master Gardener office also has pruning tips handouts. Call (209) 533-5912.

Start Aging Manure Now.   If youd like to use fresh manure in your garden come spring planting time, put it somewhere in the landscape now where it can age for one to two months before use. Fresh manures, especially nutrient-rich chicken manure, are too hot to use in a planting hole, as they might burn tender roots. Plants cannot make use of the nutrients in manures until they have at least partially decomposed.

Maintain Garden Tools. If you didnt clean, sharpen or repair garden tools before putting them away last fall, spend a rainy weekend day preparing them for use this spring.

Curl Up With Seed Catalogs and Gardening Books.   This is probably my favorite winter gardening activity. Pore over garden and landscaping books, as well as some of the websites mentioned above, to research plants and their ideal growing conditions, learn how to install drip irrigation systems, or maybe pinpoint the causes of and ways to prevent pests or plant diseases that plagued your garden last year. There are a gazillion gardening resources, but some of the best are: Sunset’s Western Garden Book, the California Native Plant Society website (, and the UCCE California Garden Web (

If you plan to start plants from seeds indoors, now is the time to peruse the seed catalogs and order. There are many seed companies to choose from, but here are a few of my favorites: Baker Creek Heirloom Seeds ( and Johnnys Selected Seeds ( Also, check out the seed-lending library at the Tuolumne County Library. Call for days/times: (209) 533-5507.

Start a Gardening Journal.   Use this relative downtime to make notes about what worked and what didnt in your garden last year. Think about your goals for your landscape, and prioritize the tasks necessary reach them. Consider purchasing a calendar that you dedicate to gardening to-dos by month.

Gardening is, in a way, a state of mind, so enjoy the tasks that are ideal for winter weather now — because before you know it, spring will be here.

Rachel Oppedahl is a University of California Cooperative Extension Master Gardener of Tuolumne County who spends way too much time with her nose in gardening books and seed catalogs.

For more helpful Master Gardener articles view our archive here located in the Real Estate Section with other home improvement, home finance and other informative real estate articles updated weekly here.

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‘Hope Budget Results in Lower Home Loan Interest Rates’: Niranjan Hiranandani

On29 February 2016, when the Honble Finance Minister Shri Arun Jaitley makes his Budget proposals speech, the hopes and aspirations of home seekers will be that the Union Budget would enable home loan interest rates becoming affordable. The Budget and its impact on home loan interest rates are among the issues which the real estate industry will watch very closely on29 February 2016. Perception among home seekers at present is that currently, banks and Home Finance Companies (HFCs) are offering interest rates which appear to be on the higher side. Across Mumbai, suburbs and the Mumbai Metropolitan Region (MMR) as also the state of Maharashtra, among the high expectations which real estate stakeholders have from the upcoming financial budget 2016-17, is that lower interest rate home loans will provide much-needed relief to the home seekers, said Niranjan Hiranandani, MD, Hiranandani Communities and Founder-President National Real Estate Development Council (NAREDCO – Maharashtra).

Prime Minister Narendra Modi has spoken about the initiative, Housing For All Indians by 2022. It is a laudable initiative, but would appear to be difficult to achieve unless home loans become affordable to all, said Niranjan Hiranandani. During the previous NDA Government under the then Prime Minister Shri Atal Bihari Vajpayee, home loan interest rates had come down to historic lows. This was one of the main reasons why a large number of home seekers could buy their homes. In the Budget Proposals for 2016-17, I hope the Honble Finance Minister Shri Arun Jaitley effectively brings down the interest rate on home loans – 7.5 per cent to 8.5 per cent would constitute a good spread, he added.

There is also the aspect of transmission of rate cuts to end users ie home loan takers, on the part of banks. Hopefully, the Budget proposals will have positive indications. Home buyer sentiment is expected to continue with the positive trend it has exhibited since festive season 2015, going into 2016, on the premise that the RBIs rate cuts, once fully transmitted by banks to home loan takers, will add to the positive sentiment, he added.

Apart from this aspect, home loan interest amount exemption under Income Tax benefit should be increased from the existing limit, said Niranjan Hiranandani.

Given the perception that interest rates on home loans are lsquo;very high, many a home seeker has turned into a lsquo;fence sitter, as paying a high interest component in the EMI impacts home budgets. Over the past few months, lsquo;fence sitters have grown and the right points in the Budget can help change this, said Niranjan Hiranandani.

The positive sentiment witnessed in real estate, especially in terms of commercial real estate right from the first half of the year and residential real estate from the beginning of the festive season in 2015 suggests that 2016 will be a positive year. Real estate stakeholders have high expectations from the upcoming financial budget 2016-17, and I hope the Budget proposals on29 Februarywill see the Honble Finance Minister Shri Arun Jaitley having good news for all stake holders in real estate, concluded Niranjan Hiranandani.

~ Niranjan Hiranandani is Founder amp; MD, Hiranandani Group, his recent initiative is Hiranandani Communities. He is the Founder and First President (Maharashtra), National Real Estate Development Council (NAREDCO), which works under the aegis of Ministry of Housing amp; Urban Poverty Alleviation, Government of India.

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SBI new home loan offers 3-5 yrs interest moratorium to NewGen

Feb 02, 2016, 10.31 AM | Source: PTI

SBI new home loan offers 3-5 yrs interest moratorium to NewGen

With the FlexiPay Home Loan, the bank seeks to boost its home finance portfolio by wooing young borrowers, offering them an interest moratorium for an initial period of 3 to 5 years and then pay moderate EMIs.

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Bidaya Home Finance commences operations

Bidaya Home Finance has been launched in a bid to raise the low levels of home ownership across Saudi Arabia. The company will begin operations with a capital of SR900 million.

Bidaya Home Finance is a joint venture between the finance ministry’s Public Investment Fund and Jeddah-based Islamic Corporate for the Development of the Private Sector (ICD), which is a unit of the Islamic Development Bank. Licensed under the Saudi Arabian Monetary Agency (SAMA), Bidaya offers professional and reliable Shariah-compliant financial solutions to both customers and partners.

Speaking at the press conference, Khaled bin Mohamed Al-Aboodi, Chairman of Bidaya Home Finance, said: “Bidaya was established with the primary purpose of enabling home ownership. Our role as a facilitator will aim to address the economic and social issue by increasing access to finance for middle-income home buyers, and thereby significantly contributing towards the sustainability of the housing sector in the Kingdom.”

Bidaya was granted mortgage finance license by the Saudi Arabian Monetary Agency (SAMA) in December 2015. The company is the first newly established real estate finance company to get such a license, and the SAMA approval entitles it to carry out its operations and receive customers wishing to obtain a real estate finance compliant with Shariah.

BIDAYA’s vision of enabling home ownership for all is demonstrated in its customer-centric approach and the wide range of home finance solutions offered. In order to ensure maximum market reach, Bidaya’s business model is based on forging strong alliances with real estate developers and professional service providers, while keeping in mind the aspirational needs of customers.

“We at Bidaya are committed to playing our part by streamlining mortgage finance end-to-end processing, short turnaround times, using innovative mortgage technologies, and an engineered approach to evaluate customer creditworthiness which we truly believe lies at the core of further developing Saudi mortgage market,” said Mazin bin Ahmed Al Ghunaim, CEO at Bidaya Home Finance.

The company’s short-term goal is to open three service hubs in Riyadh, Jeddah amp; Dammam. Bidaya is also set to launch its digital presence with an interactive website before the end of 2016. Bidaya’s long-term strategy, in the changing landscape of Saudi Arabia, is to enable and empower aspiring homeowners by simplifying the lengthy and tedious mortgage process to fulfill their dreams.  — SG

Fullerton India forays into home finance

Fullerton India Credit Company Limited (FICCL) has decided to foray into the highly competitive home loan market with a subsidiary, Grihashakti, which will offer loans against property and commercial property loans, apart from home loans.

The Indian housing market is a business with significant growth opportunity — with multiple drivers, including the launch of satellite and smart cities, move towards nuclear families and an increase in disposable income among the middle class, said Shantanu Mitra, chairman, Fullerton India Home Finance.

FIHFC will be launched initially through 20 branches across seven States. The company will also adopt alternate distribution channels as well as internet and mobile technology for speedy loan application and disbursal.

Lenders, including commercial banks, have been beefing up their retail lending operations, particularly home loans, at a time when loan demand from the corporate sector has remained sluggish.

According to RBI data, home loans have grown by 18.6 per cent year on year till end November, as compared to overall credit growth of 8.6 per cent. Our strong understanding of the underserved market, coupled with our existing distribution network of FICCL and advanced analytical and technological capabilities will be major catalysts as we look towards providing credit across the home loan value chain, said Rakesh Makkar, managing director of the company.

Fullerton India is a wholly owned subsidiary of Fullerton Financial Holdings, Singapore, which is a subsidiary of Temasek Holdings of Singapore. The company’s assets under management stood as Rs 10,585.70 crore, and it has a customer base of 13.51 lakh with a network of 445 branches spread across 22 States.

Repco Home Finance announces resignation of Director

Shri B. Anand IAS, a Non-Executive and Non-Independent Director of Repco Home Finance Ltd has resigned from the directorship of the Company with effect from January 29, 2016.

Shares of REPCO HOME FINANCE LTD. was last trading in BSE at Rs.646.75 as compared to the previous close of Rs. 642.6. The total number of shares traded during the day was 767 in over 52 trades.

The stock hit an intraday high of Rs. 646.75 and intraday low of 638. The net turnover during the day was Rs. 492534.

Stock markets in bear grip in 2016 so far, 5 stocks to bet upon

Domestic equity market has been in bears grip this year so far. Benchmark indices BSE Sensex and NSE Nifty fell over 3 per cent on Thursday for the first time since January 6, 2015 on account of massive sell-off in bank, power, realty and stocks coupled with weak global cues. Sensex plunged 807.07 points to close at 22,951.83, while Nifty tanked 239.35 points to settle at 6,976.35.

In the current sell-off 229 shares on the BSE hit their fresh 52-week low on Wednesday and so far over 700 stocks hit their new 52-week lows this calendar year till Feb 10, 2016. According to market experts, tepid global cues, continued selling pressure by foreign institutional investors and crude oil slumping sharply are mainly impacting domestic markets in the present scenario. The continuous surge in yen and gold is also keeping equity investors on the toes.

Sensex and Nifty along with sectoral indices such as BSE Power, Auto, Bankex and Realty are hovering at their fresh 52-week low levels.

Some of the stocks that hit their 52-week low so far include Punjab National Bank, Allahabad Bank, Adani Ports, Lux Industries, Andhra Bank, Bank of Baroda, Bank of India, BHEL, Central Bank of India, Dena Bank and DLF. Similarly, Hindalco Industries, Idea Cellular, IOB, PNB, SAIL, Suzlon Energy, Tech Mahindra and UCO Bank too touched their 52-week low level.

On upcoming trading sessions, Vinod Nair, head, fundamental research, Geojit BNP Paribas Financial Services, said, “The road ahead looks jittery with the upcoming Union Budget and the deepening slowdown in the rest of the world.”

Jayant Manglik, president, retail distribution, Religare Securities, said, We have seen good amount of selling pressure in the quality stocks also in last two trading sessions, which is indeed not a positive sign. Considering all, we suggest to uphold extra caution in leveraged trades and keep them hedged.

Below are 5 stocks on which market experts are looking bullish in the current market scenario

Bata India: Footwear major Bata India on Wednesday reported 27.53 per cent rise in net profit at Rs 44.56 crore for the third quarter ended December 31, 2015-16. The company had posted a net profit of Rs 34.94 crore during the same period of last fiscal, 2014-15. Religare in a research report said, “With management’s sharpened focus on enhancing Bata’s e-commerce platform to cater to a larger customer base, we build in a 15 per cent topline CAGR over FY15-FY18E. We have maintained Buy rating on a stock with a March 2017 target price of Rs 630.”

HCL Technologies: According to Angel Broking, HCL Technologies shares were at attractive valuations and is factoring all the bad news. The share price of the company can touch Rs 1,038 in the next few quarters.

Cadila Healthcare: Cadila Healthcare posted 38 per cent rise in consolidated net profit at Rs 390 crore for the third quarter ended December 31, on the back of robust sales in the US market. The company had posted a net profit of Rs 282 in the same period of previous fiscal. Total income of the company rose to Rs 2,428 crore for the third quarter compared with Rs 2,205 crore in the corresponding quarter of the previous year on a consolidated basis. Sharekhan in a research report said, “We believe, a strong presence in the US market, higher number of product filings and approvals in the subsequent years, will aid the growth in the US market. We have maintained our earnings estimates for FY2016, FY2017 and FY2018. We have also maintained our Buy rating on the stock with a price target of Rs 396.”

Bajaj Auto: Bajaj Auto is one of the few Indian manufacturing OEMs with a global presence/market share. On the financials front, around 82 per cent of the business operates at nearly 20 per cent EBITDA margin. ICICI Securities in a research note said, The company is following the right strategy, by launching new products in higher growth segments (economy amp; premium). We have Buy rating on the stock with a target price of Rs 2,650.

Repco Home Finance: For the quarter ended December 2015, Repco Home Finance reported net profit of Rs 38.58 crore, up 25.50 per cent, against Rs 30.74 crore in the corresponding quarter a year ago. According to Edelweiss, Repco Home Finance operates in a niche segment, which is under-served by banks and larger housing finance companies. In this backdrop, the brokerage house expects the company to be key beneficiary of growth opportunities in the mortgage finance sector, particularly in non-salaried segment and tier II/III locations. Edelweiss has Buy rating on the stock with a target price of Rs 790.

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