RBI rate cut: Big relief to realty sector - How it will help homebuyers
An interest rate is one of the important factors that one looks at while buying a home as loan equated monthly installments (EMI) depend on that.
The Reserve Bank of India's decision to cut repo rate by 25bps after the first Monetary Policy Committee Meeting under the newly appointed RBI Governor Shaktikanta Das has been welcomed by the real estate sector. Hari Prakash Pandey, Executive Director, Finance & Corporate Strategy, Runwal Group told Zee Business Online that the move will lead to lower interest rates for homebuyers and will boost the residential demand as well.
"The RBI's move on slashing the repo rate by 25 basis points focuses on driving growth and is expected to infuse liquidity in the system. This will be a much-needed relief for the real estate sector as it will lead to lower interest rates for homebuyers. RBI's decision will not only increase positive sentiments in the real estate sector but will also boost the residential demand going forward," he said.
Manoj Paliwal, Chief Financial Officer of Omkar Realtors said, "Apex Bank stood by its commitment, cuts rate by 25bps, Apex bank’s move to soften the interest rates by 25 basis points is a good move, a much-needed impetus in the real estate sector. The move will ensure softening of lending rates and EMI’s will see some reduction whereby attracting more buyers to own the house.
Secondly, the RBI’s decision to cut rates at regular intervals will improve the affordability quotient of Indian home buyers.
Sarojini Ahuja, VP, Sales & Marketing, Transcon Triumph told Zee Business Online that the decision will also increase liquidity in the banking system.
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"RBI has given positive signs showing that the market is improving and finally the financial institutions can now start on to pass the benefits to the end-users. Cheaper loans for home buyers and rising demand will create renewed interest in residential property purchase from end users," she said.
Hiral Sheth, HOD Marketing of Sheth Creators said, "The first bimonthly RBI Policy announcement by newly appointed RBI Governor Mr. Shaktikanta Das, slashing the repo rates by 25bps to 6.25% is a welcome move said, The rate cut will definitely help in bringing down the home loan interest rates and would bring some amount of relief to the homebuyers. Also, banks should pass down the benefit to the homebuyers as this will encourage the buyers to buy their dream home."
Further explaining the scenario she added that Interest rate is one of the important factors that one looks at while buying a home as loan equated monthly installments (EMI) depend on that. So, as EMI's fall due to drop in interest rates, the demand for housing should rise, Faster GDP growth and declining interest rates will help real estate companies generate more sales and propel the growth of the industry.