Torbit Forum
Monetary Policy & Real Estate Outlook
In its latest monetary policy, the RBI has put the repo rate on hold at 6.5 percent, for the 9th time in a row., with interest rates staying static. What does this hold for the real estate sector?
G Hari Babu, National President, Naredco
With stable interest rates, home loans do not become unaffordable which is likely to boost housing demand, amid enhanced market confidence and a reassuring environment for investors. This allows developers to plan their projects confidently, knowing that the financing scenario will remain favourable to capitalise on the growth opportunity, especially in the festive season.
Anuj Puri, Chairman, Anarock
With interest rates staying steady, EMIs will remain manageable for current and potential homeowners, potentially leading to increased home sales, particularly in price-sensitive affordable housing. Together with this, a reduction in tax on property sales through a readjusted LTCG regime, will enhance the appeal for real estate investments for long-term wealth growth, thereby spurring demand.
Saket Dalmia, President, India Sotheby’s International Realty
The RBI’s decision to maintain the policy rate is on the expected lines, given the current inflation and global economic scenario. This is beneficial for various sectors including real estate. Going forward, rate cuts are anticipated which would positively impact the real estate sector.
Gauri Tandle, CFO, Ashwin Sheth Group
Despite the incomplete transmissions of previous rate hikes in MCLR-linked loans, the overall lending environment continues to be conducive to growth. Now with stability in interest rates amidst a bright microeconomic environment, presents a favourable climate for the real estate market, benefiting both first-time buyers and seasoned investors alike.
Vimal Nadar, Senior Director & Head Research, Colliers India
Stability in interest rates coupled with rationalization of stamp duty changes in the budget, bodes well for the real estate sector, and residential segment. Strong visibility in financing changes should help homebuyers and developers alike in the upcoming festive season while minimal tax outgo under revised LTCG is likely to buoy investors and homeowners’ sentiment throughout 2024.
Nitin Bavisi, CFO of Ajmera Realty
Riding the tide of strong domestic economic growth, the pause in repo rate will continue to fuel liquidity in the hands of the masses and encourage them to make investments in real estate which is emerging as one of the most sought-after asset classes.
Aman Sarin, Director & CEO, Anant Raj Limited
The stable interest rates are particularly beneficial for the real estate sector as home buyers plan their purchases without the uncertainty of potential rate hikes and moreover the cost of construction also remains under check.
Umesh Singla, CFO, Worldwide Realty
The steady stance of keeping repo rate unchanged at 6.5 percent for the ninth consecutive time, boosts continuous sense of predictability , fostering affordability and bolstering the confidence of the sector, crucial for long-term investments. It will also support the ongoing recovery in the commercial real estate segment.
Raj Yadav, Managing Director, Navraj Group
The new monetary policy announced by the RBI is favourable for both developers and end-users. For developers, it means continued access to affordable capital essential for the timely completion of ongoing projects and undertaking new projects. For luxury buyers , it offers sustained access to favourable home loans , encouraging investment in premium properties.
Mohit Mittal, CEO, MORES
With borrowing costs remaining stable, we can expect sustained movements in the housing market as affordable financing options continue to be available. This is especially significant for first time homebuyers as interest rates play a crucial role in decision making. Commercial real estate will also get a boost, encouraging businesses to expand and invest in newer places.
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