As Monitoring Policy Committee of Reserve Bank of India today slashed the repo rate by 25 bps to 6% at its third bi-monthly policy review. Here's the reaction of CREDAI and Real Estate developers:
According to Mr.Pankaj Bajaj, President, CREDAI NCR "It is a welcome cut. More importantly, we hope that the banks will pass on the rate cut to the retail borrowers. Given that the demand for housing is weak at the moment with the current home loan rate of around 8.5% per annum, we are looking at deep cuts in the rate to revive the demand. We hope that the banks will transmit the past and current rate cuts by RBI to bring the home loan rates to between 7 and 7.5% per annum. We think that that will be the inflection point for revival of demand”
Mr.Prashant Tiwari, Chairman, Prateek Group, said "Reduction in the repo rate was an awaited move which will improve the overall market sentiments. The result of this rate cut will be reaped by home-buyers in the form of reduced home-loan interest rates. Moreover, with fall in interest rates, the demand for home loans will also continue to grow stronger. We hope home buyers will take full benefit of this golden opportunity as there couldn’t be a better time than this to invest in property market".
According to Mr. Owais Usmani, MD, Presidency Infraheights "We hope that market will see an upsurge of buyers willing to enjoy the likely rate cuts by the banks. Until and unless banks decide to pass on the benefits it would be difficult to gauge the effects of RBIs step, which came at a time when economic growth is slow. Another aspect is that right now real estate developers are focusing on RERA and GST compliance, projects are not being launched and many projects are stuck. In such a scenario, it can be said that effects will be visible only after some time".
Mr. Saurabh Jindal, Joint Managing Director, SVP Group, said "It was an anticipated move by the RBI as economic activity was at a low for the past two years. By reducing the rates RBI has given a window to the banks to pass on the benefit to the home loan seekers. Hopefully, this step will make more buyers to come forward and realise their dream of owning a house. We should also understand that real estate prices are at all time low and if banks passes the benefits to home loan seekers then this would be the best time to invest in property."