Realtors on Thursday demanded that the RBI should consider reducing the repo rate in its next monetary policy review meeting to boost sales of residential properties, while welcoming stability in the interest rate regime.
Real estate developers and consultants feel that the strong momentum in the housing market will continue with the RBI deciding to keep the key policy rate unchanged.
The RBI decided to keep the policy rate unchanged for the sixth time in a row in view of global uncertainty and the need to bring down retail inflation to 4 per cent. RBI governor Shaktikanta Das in his statement said the buoyant demand for residential housing, coupled with increased thrust on government capex, is expected to propel construction activity.
Realtors’ apex body CREDAI President Boman Irani said the high GDP growth indicates that the “Indian economy is stable with relatively healthy macro-economic indicators and can absorb any impact of a repo rate cut, if announced, in the next financial year.”
Industry body NAREDCO’s National President G Hari Babu welcomed the decision to maintain the repo rate.
The unchanged repo rate will stimulate demand in the real estate sector, benefiting both residential and commercial segments, he said.
“Despite this stability, it’s noteworthy that the current interest rate is at its highest level in the last four years. Therefore, we urge that this factor be taken into consideration in the upcoming review meeting. Such efforts will support the promotion of ‘Affordable Housing’ and the government’s crucial initiative of ‘Housing for All’,” Babu said.
Among builders, Gaurs Group CMD Manoj Gaur hailed the RBI’s move and said the real estate sector will continue to show buoyancy as in the past quarters.
Signature Global Chairman Pradeep Aggarwal said the repo rate should have been reduced but added that a stable interest rate would help in sustaining demand.
Nayan Raheja of Raheja Developers said the repo rate remains at a 4-year high, and a rollback would have boosted the affordable housing segment. Krisumi Corporation MD Mohit Jain said, “While from the real estate sector perspective, a downward revision in rates would have been the best outcome, but the RBI’s decision to hold rates implies steady EMIs for borrowers.”
Avneesh Sood, Director at Eros Group, said this steady stance, upheld for the sixth consecutive time, is a boon for homebuyers, ensuring relatively affordable home loan interest rates.