The Reserve Bank of India (RBI) announcement on repo rates, which has an impact on home loan interest rates among other aspects, tends to be one of the most awaited for real estate stakeholders across the spectrum. The suspense is as nail biting as the final over of a limited overs cricket match and the jubilation on hearing a positive outcome, just as enthusiastic.
In his pre-announcement expectations, Rajan Bandelkar, National President, NAREDCO, had shared that the RBI’s accommodative stance is expected to persist during the October MPC meeting. While there has been a lengthy pause, there is a pressing need to shift our attention towards the real estate sector, especially during the ongoing festive season. Positive actions by the RBI at this juncture could play a pivotal role in achieving our housing targets.
Given the robust demand in the real estate sector nationwide, it is imperative that we maintain low-interest rates. This approach can effectively stimulate potential buyers to secure loans for property purchases, consequently invigorating overall real estate market activity. We anticipate that the RBI will ensure sufficient liquidity within the banking system, as this is paramount for enabling banks to offer lending and financing options to both developers and buyers. Such measures will, in turn, bolster the growth of the real estate sector.
Well, the good news is that the RBI once again opted to maintain the status quo when it came to the repo rates.
Reacting to the RBI repo rate remaining unchanged, the NAREDCO National President said, “We welcome the decision of the Monetary Policy Committee of the Reserve Bank of India to keep repo rates unchanged. This decision will benefit everyone, ensuring liquidity in the market and adding to the festive cheer. The stability in interest rates is a relief for developers who are navigating a complex economic scenario. Unchanged rates provide a degree of predictability, which is essential for planning and executing long-term projects. This decision aligns well with our industry’s need for continuity and fosters an atmosphere of cautious optimism. However, we expect the central bank to remain mindful of emerging market dynamics and to continue supporting growth-oriented measures. The body of real estate developers acknowledges the careful balancing act being performed by the RBI, considering various economic factors. As we move forward, we will build a stronger real estate industry.”
Echoing his views, Pritam Chivukula, Vice President, CREDAI-MCHI, opined, “The RBI’s decision to keep the repo rate unchanged at 6.50 per cent has been in line with the government’s stance of keeping inflation in check while maintaining liquidity in the economy. The government has been supportive to the real estate sector with constructive industry policies. This pause in the repo rate has come at an apt time given the ongoing festive season which will improve market sentiments and drive housing demand even further. Construction activity has been buoyant on the back of timely government intervention and positive policy measures keeping the economy strong against global headwinds.”
