The realty sector has been one of the worst hit sectors in the recent past due to variety of reasons. The bad times for the realty sector commenced with rising cement and steel prices, coupled with the Reserve Bank of India raising the interest rates to combat rising inflation. Thereafter, the global financial crisis brought with it an economic slowdown. All of these reasons resulted in a quick slump in demand for residential and commercial properties.

During the last year a lot of realty firms had raised money from the capital markets and through private equity with RBI policies making it tough for the realty firms to raise bank finance. However, these alternative funding sources have dried up since the global financial crisis broke out. Realty firms finding themselves at the receiving end of the bloodbath on Dalal Street made matters worse for the realty sector.

These things clearly signaled a serious crisis for the sector which resulted in the industry leaders in the sector requesting for a Government intervention. The realty firms expected the Government to take steps to bring in more liquidity into the sector by easing lending norms and also requested for a reduction in housing loan interest rates to boost the demand.

The RBI provided a breather for the sector last weekend by announcing a slew of measures especially for the real estate sector apart from 100 basis points cut in the interest rates. One of the most important announcements includes Rs 4,000 crore refinance facility for National Housing Bank. The RBI has also decided to grant "priority" status for housing loans upto Rs 20 lakh and for loans given by banks to housing finance companies for on-lending to individuals for purchase or construction of homes of upto Rs 20 lakh.

As per the existing RBI norms, every bank is required to set aside 40 percent of its deposits for lending in the priority sector. As a part of the policy announcements on Saturday, the RBI has also clarified that banks can classify housing loans up to Rs. 20 lakh as "priority sector" advances, subject to a ceiling of five per cent of their total priority sector limit. The above moves are expected to provide a life line to the realty firms who operate in the low-cost housing segment. This measure would also help the housing sector and the realty firms which operate in the nonmetros or the Tier II cities.

The other major measure announced by the RBI on Saturday has been the relaxation of asset classification norms for commercial real estate advances. It may be recalled that the RBI had, earlier this year, issued a directive requiring the banks to classify advances to a property developer as a Non Performing Asset (NPA) the moment the advance was restructured. This directive of the RBI had made raising bank finances difficult for developers whose loans were classified as NPA by other banks.

The RBI has now relaxed the asset classification norms for commercial real estate advances, by granting concessional treatment to commercial real estate advances which are restructured upto June 30, 2009. This one time measure grants a relaxed treatment of non-classification as NPAs to second restructuring done by banks of real estate advances before June 30, 2009. This step would surely relieve the realty firms of the liquidity crisis. This move would also encourage the banks to increase their exposure to real estate sector. The 100 basis point rate cut should also ease the cash crunch situation if the banks lower their lending rates.

Though some of the realtors have voiced their opinions on the measures announced by RBI not being sufficient, these measures are intended to boost the demand for low-cost housing and also ease the cash crunch situation which the realtors are facing. These measures together with the Rs 30,700-crore fiscal stimulus package unveiled by the Government aimed at guiding the economy away from a possible downturn.

This form of mortgage unlocks the revenue potential of a house for senior citizens
A mortgage is a form of hypothecation of a property to a banks or housing finance company as a security for a loan. A common form of security banks insist on is a mortgage of the house for which the loan is being availed of by the borrower.

Mortgage is the transfer of interest in a specific property to secure the payment of money advanced. The transferor is called a mortgagor, the transferee a mortgagee, the principal money and interest secured are called the mortgage money, and the instrument by which the transfer is effected is called a mortgage deed.

In case of a reverse mortgage, the property owner surrenders the title of the property to a financial entity. The financial entity doesn't pay the entire amount to the owner upfront. On the contrary, it pays out a regular sum each month for the agreed time. The owner gets to stay in the property along with his spouse for their lifetime. Thus, the owner can ensure a regular cash flow in times of need and enjoy the benefit of staying in the property. After the owner's death, the property is transferred to the institution, and not to the heirs. Reverse mortgage is a relatively new concept in India. The concept is quite popular in developed countries to generate cash flow.

The arrangement will be available to those above a specific age, for example, 60-65 years. The aim is to turn the immovable property into a 'liquid' asset that generates a return while it is used by the owner. The amount paid out each month is for a specific period of time. The financing institution has to bear the risk of the individual outliving the agreement. At the expiry of the agreement period, the monthly payments to the owner stop.

The monthly payout depends on the value of the property, terms of the agreement and the rate of payment. The valuation of the property is to be done by professionals. The entire payout mechanism - calculation and computation - depends on the law of probability.

On the death of the owner, the spouse can continue living on the premises. Only in case both the husband and wife die during the tenure of the scheme, the institution will sell the property, take its share as per the terms and distribute the rest among the heirs.

As a concept, reverse mortgage is of immense use in unlocking the otherwise illiquid asset. Hitherto, immovable property was treated as one of the most illiquid assets. Reverse mortgage tends to unlock the liquidity potential of this asset. It helps the owner get a decent return from his immovable property, without having to part with it. The owner can continue to be in possession of the property during his lifetime

Here are some tips to help you use energy more efficiently at home

• Switch to low energy lighting throughout your home that uses one fifth the energy of normal light bulbs. CFL bulbs are a good energy-saving option. Use movement-sensitive lights areas like hallways so that every time you pass by or leave a room, the lights automatically sense it and turn on or turn off. Always turn off your computer and television. Never keep them on standby as this consumes more energy.

• Don't forget to switch off broadband connections, speakers or printers. They're all mini-energy guzzlers which, taken as a whole, amount to a lot.

• Look for refrigerators and washing machines having the highest energy-efficiency rating.

• As regards cooking appliances, microwaves are the most efficient as they cook fast.

• Get batteries that can be recharged rather than recycled.

• Install solar panels on your roof top. In climates like ours, a solar heating system can provide 50 to 75 percent of domestic hot water use.

• The energy (natural gas, propane, electricity, etc) needed for hot water heating can be reduced by 60 to 90 per cent by using a solar water heating system to pre-heat water before it enters your existing traditional water heater.

• Costing far less than a new conventional heating system, solar air heating systems usually pay for themselves in 3-6 years. They typically last for 18 to 35 years and require minimal maintenance.

• Get a switch installed which checks your power usage. This will automatically turn off the power if the usage is more than the prescribed load.