Mumbai, Feb. 10 -- The Reserve Bank of India's decision to cut the repo rate by 25 basis points has been met with optimism by industry experts, particularly in the real estate sector. The move is expected to boost affordability for homebuyers and improve liquidity in the market.
Boost for Housing Demand
Industry leaders view the rate cut as a step towards making home loans more affordable. According to Niranjan Hiranandani, CMD of Hiranandani Group, ""The reduction in the repo rate by 25 basis points is a welcome step, enhancing affordability for homebuyers and boosting housing demand."" He emphasised that lower home loan rates will benefit the entire real estate ecosystem, making it an opportune moment for prospective buyers.
This sentiment is echoed by J C Sharma, VC & MD of Sobha Ltd, who noted, ""The rate cut will help homebuyers as it reduces borrowing costs, thereby improving affordability and demand for housing."" Lower interest rates have historically spurred demand in the residential segment, encouraging fence-sitters to make purchase decisions.
Industry Optimism on Liquidity and Growth
The move is expected to ease liquidity concerns and drive economic growth, according to Anshuman Magazine, Chairman & CEO, CBRE India, South East Asia, Middle East & Africa. ""The RBI's decision to cut the repo rate will have a positive impact on economic growth and will boost investor sentiment, particularly in real estate,"" he said.
Similarly, Shishir Baijal, Chairman & MD of Knight Frank India, observed, ""This rate cut is expected to revive housing sales momentum, particularly in the affordable and mid-segment categories. Lower EMIs will encourage more homebuyers to enter the market.""
Developers Hope for Further Reforms
While the rate cut is seen as a positive development, some experts believe additional measures are necessary to sustain long-term growth. Pankaj Bajaj, MD, Eldeco Group, stated, ""While the rate cut is good news, we hope that banks will pass on the benefits to consumers swiftly. Additionally, more structural reforms are required to ensure sustained growth in the real estate sector.""
With lower borrowing costs, improved affordability, and a potential uptick in housing demand, the real estate sector stands to benefit significantly from the RBI's decision. However, industry leaders emphasise that policy continuity and further reforms will be key to ensuring sustained momentum in the sector.
Photo: Freepik
Published by HT Digital Content Services with permission from Construction World.