With the Indian economy showing positive signs of recovery, the home loan rates might increase. According to India's second largest lender, ICICI bank, the interest rates could rise in the latter half of the fiscal.

"There is growth already seen in auto and home loans...In the latter part of this fiscal, I expect that project finances will also pick up...We will continue to focus on home, auto and infrastructure loan segments," said Chanda kochhar,ICICI Bank's Managing Director and CEO"

C Rangarajan, chairperson of the Prime minister's EAC, expressed a similar view regarding the interest rates.

This week, the inflation rose by 0.12 per cent while it had fallen by 0.12 percent the preceding week. Inflation in India is measured on the basis of wholesale price index, which considers a basket of 435 commodities.

The likely increase in the lending rates could shatter your plans of buying a new house at cheaper rates. The rising inflation could force RBI to put a check on the liquidity in the market by increasing the lending rates and the CRR.

Realty firms may also suffer losses as people might decide against buying houses. The finance minister, Pranab Mukherjee, said that the government had been expecting this trend.