New Delhi: The Reserve Bank of India’s decision to keep the repo rate unchanged at 6.5 per cent at today’s MPC meeting reflects the Central Bank’s cautious yet optimistic stance, aligning with a stable interest rate environment and fostering borrower confidence for informed financial decisions. Borrowers, particularly in home and personal loans, may explore options to optimise their financial commitments, such as transferring loans to banks offering lower rates or opting for part payments to reduce EMIs.
The stable repo rate will keep home loan interest rates attractive and will add momentum to the housing sales in the country.
Anuj Puri, chairman of the AMAROCK Group said “With the fundamentals of the Indian economy remaining strong despite all global headwinds and inflation well under control, the RBI once again decided to keep the repo rates unchanged at 6.5%, thus extending the festive bonanza that it gave to the homebuyers in its last two policy announcements. Thus, homebuyers retain their advantage of relatively affordable home loan interest rates.”
He added “If we consider the present trends, the housing market has been unstoppable, and unchanged home loan rates will help maintain the overall positive consumer sentiments. Given that housing prices have risen across the top seven cities in the last one year, this breather by the RBI is a distinct advantage to homebuyers.”
As per ANAROCK Research, 2023 saw average housing prices rise by anywhere between 10-24% in the top 7 cities, with Hyderabad recording the highest 24% jump. The average prices in these markets stood at approx. INR 7,080 per sq. ft., while in 2022 it was approx. INR 6,150 per sq. ft. – a collective increase of 15%.
Kaushik Mehta, Founder & CEO of RUloans Distribution said, “Borrowers, particularly in home and personal loans, may explore options to optimize their financial commitments, such as transferring loans to banks offering lower rates or opting for part payments to reduce EMIs. Additionally, the government's focus on real estate is poised to provide a significant boost to the housing loans segment, with policies and incentives aimed at stimulating activity and enhancing accessibility to housing finance, benefiting both borrowers and lenders.”
Furthermore, recent fiscal measures outlined in Budget 2024-25 aim to further support affordability and accessibility to loans, particularly benefiting middle-class individuals and stimulating economic growth within the housing sector, Mehta said.
Chandresh Vithalani, director of Palladian Partners Advisory LLP added that by keeping the repo rate steady in the face of global uncertainties, the RBI has provided a predictable financial environment, allowing for more strategic planning and investment in real estate projects.
This environment not only boosts buyer confidence but also stimulates sustainable growth in the real estate market, ensuring that investments made today will yield positive outcomes in the future, Vithalani said.
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