In the last two years the housing market has turned red hot. In south Delhi rubbishy DDA flats which were selling for three and a half million rupees are now selling for ten a half million, an appreciation of 300% in just two years. This has spread to smaller towns giving rise to a building boom. To cool the market the Reserve Bank ( RBI ) first increased interest rates and then increased the Cash Reserve Ratio ( CRR ) for banks to reduce liquidity. Curiously in the last one week the RBI has gone backwards, first by decreasing the CRR and then by transferring home loans to the priority sector for properties costing less than 2 million rupees. Now everyone knows that if a person takes a loan of 2 million he will add another 3 million in black which means that the RBI is facilitating sales of upto 5 million rupees. While this may not mean much in the metro cities it will heat up the market in smaller towns and for small properties in creasing the feel good factor. In recent elections in Uttarakhand, Bengal and Delhi the Congress has done badly but it may do better in the ongoing elections in UP which is the largest state. If the Congress does really well in UP it might call an early general election knowing that if it wins the Hindi or cow belt it can return to power. The asset price bubble should not burst before then. Afterwards who cares. Maybe this move dictated purely by economic indicators but why am I unable to believe?