New Delhi: In order to revive the demand in the real estate sector, urban development minister Jaipal Reddy on Tuesday favoured cheaper loans for buying houses.

“Real estate is facing a slowdown. So we should make an arrangement for giving loans at 6.5% interest for houses in the below Rs5 lakh category to the poor,” he said after his meeting with finance minister Pranab Mukherjee in Delhi.

“It was a pre-budget meeting and we discussed budgetary issues with the finance minister,” he told reporters.

Reddy suggested extension of housing loan at the rate of 7.5% presently available for flats up to Rs20 lakh to those priced at Rs30 lakh in cities.

“The revival of real estate is key for generating employment. The existing 7.5% interest scheme should also be extended beyond June to motivate more buyers,” he said.

Reddy sought more budgetary allocations for Commonwealth Games projects, DMRC extension and JNNURM projects.

“Keeping the ongoing games projects in mind, we have sought more budgetary provisions,” he said, adding more funds for Delhi Metro extension programmes were also sought.

“Our JNNURM programme is the most successful one and now more and more states are seeking projects under the scheme. So we have asked for more budgetary allocations for it,” he said.