Reddy warns of asset bubble

RBI has warned against creating any bubble in the housing loan segment. ‘‘We do not want any asset bubble as experienced by many western countries. We have taken some steps to regulate home loans more effectively,’’ said RBI Governor Y.V. Reddy. ‘‘In the last two years the real estate loans have taken a big jump and the NPAs, if any, will reflect in the years to come. At the same time we do not want any shift from the government’s policy which emphasises on housing for all. Hence we have accorded priority sector lending status for home loans up to Rs 15 lakh,’’ the governor said. Many banks are not comfortable with the boom in the sector.