Low interest rate on home loans to boost home sales, estate agents say
Property developers on Friday welcomed the RBI’s decision to keep policy rates unchanged, saying the low interest rate regime will help maintain sales momentum in the residential sector.
Harsh Vardhan Patodia, chairman of estate agents body CREDAI, said the RBI’s decision to keep the repo rate unchanged at the all-time low of 4% will bring economic development and growth to the country, especially after the impact of COVID-19 on several sectors. .
“The current repo rate will be beneficial for the real estate sector as homebuyers continue to witness an easing in home lending rates. We appreciate RBI’s confidence in maintaining liquidity to keep the real estate sector optimistic about future growth, especially after the sudden impact on real estate players followed by rising raw material costs,” he said.
Patodia hoped that the RBI would also continue to maintain the status quo in the coming months, as this can be a game-changer for all sectors contributing to the country’s GDP.
Naredco Vice Chairman Niranjan Hiranandani said: “The current low interest rate on home loans and risk weighting guidelines for individual home loans, which have been extended until March 31, 2023, will continue to ‘to be the “demand catalyst” in the short term, ensuring that the selling velocity remains high despite the brief upward revision in house prices.”
Nayan Raheja of Raheja Developers said, “IME will not be affected by this decision. A continued positive attitude as the economy emerges from its long road to recovery bodes well for a strong economy to recover.
The move will have a long-term impact on the property sector, ensuring it continues to grow, he added.
“The RBI’s decision to keep the repo rate at 4% was expected. The announcement will certainly help the real estate sector to accelerate growth and will certainly improve market sentiments. This was done to maintain the dovish stance, which will allow banks to lend home loans at the current level, which is a crucial factor in encouraging home buying decisions,” said Santosh Agarwal, chief financial officer and chief executive of Alpha Corp.
Saransh Trehan, Chief Executive of the Trehan Group, said the RBI’s decision to extend the streamlined risk-weighting standards on home loans for a year until March 2023 will boost the residential property market by encouraging banks to provide loans to potential buyers at affordable prices.
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