Unchanged repo rate boosts investors’ confidence in real estate market, say developers

Governor Shaktikanta Das has opted to keep the repo rate steady at 6.5% in the monetary policy review held today, signalling a cautious stance in light of global economic volatility and domestic challenges. This decision aims to maintain accommodative monetary conditions to bolster economic recovery while addressing inflation concerns. Also, Homebuyers can take comfort in the unchanged interest rates on home loans, promoting stability in the real estate market. As a pivotal sector reflecting broader economic trends, the real estate market served as a barometer for India’s economic health in 2023. Looking ahead, the real estate industry’s outlook appears optimistic, supported by the sustained confidence in monetary policies and the anticipated positive trajectory of economic indicators.

Mr. Pradeep Aggarwal, Founder & Chairman, Signature Global (India) Ltd. said “As expected, the RBI kept rates on hold. The prolonged pause, for the sixth time, since February 2023, is aimed at keeping inflation in check without hurting the economic growth momentum. With the reduction in policy rates would have been the best scenario for interest-sensitive sectors like the real estate sector, policy continuity is the next best outcome for both borrowers and developers alike. The decision allows homebuyers to make informed choices, which is expected to result in enhanced demand across all housing segments in line with the country’s overall economic progress.”

The RBI has opted to keep repo rates unchanged, a move aimed at bolstering economic recuperation and potentially spurring banks to extend favourable home loan terms to stimulate housing demand. This choice is anticipated to instil confidence in both developers and homebuyers, enabling banks to provide more attractive rates to stimulate housing demand. Nevertheless, in light of inflationary pressures, banks may exercise prudence in moderating rate cuts excessively. The steadfastness in borrowing rates will prove advantageous for prospective homebuyers, thereby fostering heightened demand within the real estate sector.” – Mr. Santosh Agarwal, Executive Director and CFO, Alphacorp.

“The RBI’s decision to maintain the status quo on repo rates underscores a strategic approach toward nurturing economic recovery. By abstaining from rate adjustments, the central bank aims to provide stability while encouraging banks to offer enticing home loan packages, thus invigorating the housing market. This calculated move is poised to inject optimism into the real estate landscape, fostering a conducive environment for developers and aspiring homeowners alike. While the decision aligns with the goal of stimulating housing demand, it also acknowledges the need to tread cautiously amidst inflationary pressures. The deliberate stance on borrowing rates is poised to benefit potential homebuyers, as it ensures affordability and sustains momentum in the real estate sector. With this equilibrium in lending rates, the stage is set for a resurgence in housing activity, fuelling optimism for economic resurgence and revitalized growth prospects.”- Mr.  Aman Sharma Founder & Managing Director Aarize Group

Gaurav K Singh, Founder & Chairman, Womeki Group said, “We appreciate the RBI’s decision to maintain the repo rate at 6.5%. This will provide a favourable environment for the real estate sector’s growth, fostering investor confidence. As developers, we acknowledge the RBI’s prudent approach, to balancing economic considerations. This decision ensures a favourable lending environment, supporting homebuyers and stimulating housing demand. We look forward to continued collaboration between the RBI and the real estate industry, contributing to the nation’s economic resilience.”