LIC Housing raises lending rates by 0.35%; home loans will now cost 8.65%.

MUMBAI: LIC Housing Finance, like its peers, raised its lending rate by 0.35 percent. The move, which comes a week after a similar increase by bigger rival HDFC, means that the minimum rate of interest for the best-rated borrower will be revised to 8.65 percent.

The company said in a statement that it has raised the LIC Housing Prime Lending Rate (LHPLR), to which the rate of interest on its loans is linked, by 0.35 percent.

“The increase in rates is in tune with the market conditions,” the company’s managing director and chief executive Y Viswanatha Gowd said.

He also stated that home-buying activity in the real estate sector is currently strong.

It should be noted that the Reserve Bank has increased the repo rate, at which it lends to the system, by a total of 2.25 percent in five consecutive moves since May of this year. Lenders in the system have responded to the RBI’s rate hikes.