Real estate industry seeks repo rate cut

Vijay C Roy

Chandigarh, June 7

Welcoming the RBI move to keep the repo rate unchanged at 6.5 per cent, real estate developers have sought its reduction in near future to bring down the interest rates on home loans and further boost demand for residential properties.

“The RBI decision is on the expected lines. Such a move would be a welcome news for homebuyers across cities. With overall inflation falling within the RBI range, a policy rate cut may not be very far away. Real estate prices have gone up substantially and a future rate cut will give much higher purchasing power to the customer which is the need of the hour,” said Samir Jasuja, CEO and MD of PropEquity.

Motia Group director LC Mittal said the RBI’s strategy to wait and watch before initiating further rate cuts was well-appreciated, especially in the light of the eagerly awaited Union Budget that is expected to shed light on fiscal policy.

Analysts said the RBI move would keep the liquidity and the cost of borrowings at static level, keeping the cost under control, and benefitting the real estate sector.

“Lower interest rates could further boost the real estate sector, which is already experiencing strong market demand from end-users. We expect the robust demand trend to stay healthy over the next few years,” said Pradeep Aggarwal, chairman of Signature Global (India) Ltd.