Real Estate latest news: Announcing the first bi-monthly monetary policy for the ongoing fiscal year, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) has decided to keep the repo rate unchanged at 6.5 per cent.
Real Estate in India: The Reserve Bank of India (RBI) has decided to keep the policy rate unchanged for the seventh time in a row. Announcing the first bi-monthly monetary policy for the ongoing fiscal year, RBI Governor Shaktikanta Das said the Monetary Policy Committee (MPC) has decided to keep the repo rate unchanged at 6.5 per cent. This aims at a strategic approach to nurturing economic recovery and fostering stability.
Impact of RBI MPC on Home Loan, EMI
Since the last few years, the demand for residential real estate has been registering significant growth, and it continues its momentum into the new financial year. As the repo rate remains unchanged, this would serve as a big boost to the homebuyer sentiment and enable better affordability, which is an extremely sensitive factor in the housing market. If there’s a hike in repo rate, then the interest rates of home loans, EMIs etc will go up. But as the repo rate remains unchanged, then there will be no change in home loan EMIs for the people.
Vimal Nadar, Senior Director and Head, Research at Colliers India said that the decision offers a sense of continuity and predictability for the real estate sector. “It also provides a solid foundation for future investment and development initiatives. Developers and investors can capitalize on the conducive environment to explore new opportunities and drive innovation in the market. Moreover, unchanged lending rates continue to present EMI-dependent buyers with a rational opportunity to fulfill their home-ownership aspirations. With the anticipation of rate cuts in the ongoing fiscal year, the momentum in the residential segment is likely to persist.”
Nayan Raheja, Raheja Developers said, “The growth trajectory of the realty sector remains positive, consumption is rising, and more and more people are investing in the mid, premium, and luxury housing sectors. India is firmly on the path of progress, and the decision by RBI to not disturb the pace by keeping the repo rate unchanged will enthuse the sector as it will also provide some relief to borrowers as their EMIs will not rise.”
Real Estate Developers Hail RBI’s MPC Decision
Real estate developers have welcomed the move as it benefits potential homebuyers by ensuring affordability and sustaining momentum in the housing market.
Prashant Sharma, President of the National Real Estate Development Council (NAREDCO) Maharashtra, shared his enthusiasm regarding the RBI’s stance. He attributed a recent surge in home sales to this positive financial environment, bolstered by optimistic consumer sentiment and supportive government policies. “We foresee an escalation in demand, particularly within the affordable and mid-segment housing markets. This trend is expected to persist, with hopes of a future reduction in the repo rate,” Sharma noted.
Pradeep Aggarwal, Founder & Chairman, of Signature Global (India) Ltd., said, “A stable and predictable repo rate lends credence and confidence to the average homebuyer who can be assured while taking home loans. This stability has a direct cascading effect on the growth of the real estate sector, which in turn contributes significantly towards India’s GDP and future growth prospects.”
Dr. Renu Singh, Director – Sales and Marketing, Aarize Group said that the monetary stability, exemplified by the RBI’s steadfast adherence to the 6.5 per cent repo rate, is a keystone for real estate investments. “As the RBI’s first policy announcement for FY 2024-25, under the leadership of Governor Shaktikanta Das, the six-member MPC scrutinizes global factors impacting India’s GDP growth and inflation trajectory. With the expected decision to maintain the repo rate for the seventh consecutive time, we seize the opportunity to navigate market dynamics, leveraging stability for sustainable growth,” she added.
Aman Trehan, Executive Director, Trehan Iris, said, “The decision by the Reserve Bank of India has boosts demand in the housing market, supporting overall economic progress. By maintaining stability, the unchanged repo rate keeps housing affordable and sustains the market momentum, both of which are crucial for India’s economic growth.”
Ashish Sharma – AVP Operations, Brahma Group, said, “The unchanged repo rate indicates a strong and ongoing growth momentum. This prolonged pause for the seventh consecutive time fosters economic stability and confidence, nurturing investment and certainty for businesses. As a result, businesses have greater certainty and are more likely to invest, which in turn encourages sustainable growth. Additionally, homebuyers and developers can make informed decisions with confidence.”
Gaurav K Singh, Founder and Chairman, of Womeki Group, said, “Our focus remains on the market anticipation surrounding the RBI Governor’s comments, which influence our investment strategies amidst ongoing global economic assessments. Led by Governor Das, the six-member MPC meticulously assesses the impact of global factors on India’s GDP growth and inflation trajectory, shaping the landscape for present and future real estate developments.”
S.K Narvar, Group Chairman, Trident Realty, said that maintaining the repo rate status quo supports feasible macroeconomic indicators and encourages new homebuyers to invest in property. “As India’s economy continues to grow, the real estate sector is poised to play a significant role, making the current repo rate policy a crucial factor in fueling positive demand and contributing to the country’s economic expansion,” Narvar added.
Manish Jaiswal, Group COO, Eldeco said, “We recognize the significant impact of RBI’s stance on the repo rate, poised to remain stable at 6.5 per cent for the seventh consecutive time. With a keen eye on India’s economic trajectory, the RBI’s decisions will shape the landscape for real estate sector growth.”
Yashank Wason – Managing Director – of Royal Green Realty, said, “The stability in the repo rate at 6.5 per cent for the seventh consecutive time underscores the foundation for sustained growth. With the RBI’s commitment to meeting the 4 per cent inflation target and acknowledgment of upside risks, we navigate market dynamics with vigilance, leveraging key policy rates to drive strategic investments and ensure long-term viability.”
Pyush Lohia, Director, of Lohia Worldspace said, “The RBI’s decision to maintain the repo rate is a strategic victory for real estate developers, including those focusing on tier-2 cities. The stability it brings creates a conducive environment for investment. The acknowledgment of decreasing inflation and improved liquidity further boosts confidence. Additionally, the sustained global economic resilience and expanding domestic activity signal growth opportunities in tier 2 cities too. This decision facilitates affordable borrowing, encouraging developers to initiate projects and enabling homebuyers to invest. It is a promising outlook for real estate development.
Santosh Agarwal, Executive Director and CFO, of Alphacorp said that the decision to maintain the key policy repo rate underscores the significance of monetary stability for the real estate sector. “We are keenly anticipating signals influencing investment strategies, recognizing the critical role of RBI’s decisions in shaping future market dynamics,” he added.
Dharmendra Raichura, VP of Finance at Ashar Group underscored that the resolution extends favorable conditions for potential homebuyers, contributing to resilience and vitality in the real estate sector. “Consistent home loan rates enhance consumer confidence, underpinning investment decisions and fostering an environment conducive to sustained development. The government has mandated the RBI to keep inflation at 4 per cent with a comfort band of 2 per cent in both directions,” he said.
Rajat Khandelwal, CEO of Tribeca Developers said “RBI’s decision to keep the repo rate unchanged at 6.50 per cent for the seventh consecutive time underlines its support for the residential property sector, showing good sales momentum.”
Ramani Sastri, Chairman and MD, of Sterling Developers said that the status quo stance by RBI will bolster overall market confidence. “We will continue to see a multi-fold growth in real estate investments since the real estate market is less volatile than other investment markets and delivers higher returns. Overall, consumers are keen to buy homes as stability and security are on top of their mind now and the recent past has been a testament to the fact that home buyer confidence is at an all-time high.”
Rishabh Siroya, Founder of Siroya Corp said- “The RBI’s decision to maintain the key policy repo rate at 6.5% for the seventh consecutive time instills confidence across both residential and commercial real estate sectors. Steady interest rates alleviate borrowing costs, making properties more accessible to buyers and businesses, thus stimulating demand and driving industry growth. With rates remaining unchanged, the market stands poised for continuous momentum, supported by robust demand in luxury segments and an increase in project launches. The stability in borrowing costs not only enhances affordability but also boosts investor sentiment, fostering optimism and resilience. As the industry progresses through this phase, the unchanged repo rates symbolize stability, ushering in a promising era marked by sustained growth and opportunities for developers and investors alike.”
Pratik Kataria, Director Sainath Developers – The House of Kataria & Joint Treasurer, NAREDCO Maharashtra. “The Reserve Bank of India maintains stability, holding the key repo rate steady at 6.5% to curb inflation. In its seventh consecutive decision, the Monetary Policy Committee underscores a strategic commitment. This stance benefits prospective homebuyers by ensuring minimal fluctuations in loan interest rates, enhancing affordability. Stability in borrowing costs aids builders in project planning and sustains construction momentum. The RBI’s cautious approach fosters a balanced economic growth trajectory, averting rapid price escalations. This fosters investor confidence in the real estate sector, offering a symbiotic win for both buyers and industry stakeholders. In this equilibrium, the economy finds resilience and progress,”
Manju Yagnik, Vice Chairperson of Nahar Group and Senior Vice President of NAREDCO- Maharashtra said “The RBI has decided to keep the repo rates unchanged at 6.5%. This move builds on the advantages of the earlier policy announcements by widening the advantageous conditions for homebuyers. As a result, those considering becoming homeowners can still benefit from low-interest rates on home loans. The housing market is expanding rapidly, and maintaining steady home loan rates is essential to keep the market in check and raise consumer confidence in general. The RBI’s decision offers homeowners a significant benefit and much-needed relief in the face of rising housing costs. Buyers are satisfied with a steady repo rate since it gives them another opportunity to purchase real estate at a good price. This decision sets a base for the housing sector’s long-term stability and expansion and boosts the optimistic attitude currently permeating the market. With the understanding that the market is in a favourable position to support their investment decisions, purchasers can move confidently through it.
Source : ET
