Real Estate Industry Finds RBI's Monetary Policy as Expected

Real estate developers and consultants said the RBI’s decision to keep key policy rates unchanged was on expected lines but the sector was looking for some encouragement to boost funding and demand in the sluggish housing segment. Realtors’ body NAREDCO’s President Niranjan Hiranandani said the RBI’s policy was on “expected line”.

“RBI needs to give meaning to grant of infrastructure status to affordable housing. Status quo in monetary policy leaves real estate sector struggling to fund housing for all,” said Jaxay Shah, President, CREDAI National.

Ramesh Nair, CEO and Country Head, JLL India, said the real estate sector was looking for some encouragement that would move the needle towards accelerated growth.

“The apex bank could have directed the lenders to keep the MCLR (Marginal Cost of funds based Lending rate) below 10 per cent or put a cap on the same for home loans,” he said, adding that “a REPO rate revision leading to lower home loan rates could have given sentimental boost to end user buyers”.

Shishir Baijal, CMD, Knight Frank India, said the impetus for stimulating housing demand does not lie on interest rate alone but on other reforms and steps taken by various stakeholders.

“Measures such as implementation of RERA in true letter and spirit, palatable payment plans for home buyers and relatively cheaper house prices are some of the critical determinants to revive the real estate sector”, he added.

Saha group Director (Marketing, Construction & Sustainability)  Aunirban Saha said: “The policy is stable and inflation is contained at 4% to 4.5% rate. This would help in better planning and management. By not increasing the home loan interest rates, we believe that buyers would now be more attracted in investing their money on buying homes and this in turn would contribute to the growth of the realty sector in India”.

Deepak Kapoor, Director, Gulshan Homz, said the decision of RBI to keep the rates unchanged is a clear indication that the apex bank wants to maintain its vigilant approach.

Manoj Gaur, MD, Gaurs Group, said a parallel cut in repo rate and CRR would have brought a win-win situation for the banks. Gaurav Gupta, Director, SG Estates, said the reduction in rates would have ultimately been advantageous to the customers.

Abhishek Bansal, Executive Director, Pacific Group, said “as we have just began with the financial year, a rate cut today would have allowed potential buyers to plan better for their investments in the property market for the current financial year.”

Saya group CMD Vikas Bhasin said there is a room for financial institutions to cut down on their lending rates for their customers as they have have not passed on benefits of previous policy rate cuts.

Dhiraj Jain, Director, Mahagun Group, said any reduction in lending rate allows the sentiments in real estate to improve.