RBI Kept Repo Rate Same At 4%, Affordable Loans, Real Estate Sales Can Increase

In line with expectations, RBI has remained the country's monetary policy the same and kept the repo rate unchanged at 4%. The reverse repo rate is also remained at 3.35%, as earlier. The union government is not ready to curb the liquidity infusion now as the previous employment generation and manufacturing data are not overwhelmingly good, although the inflation rate is in a concerning position.

Hence, the common citizens will be able to take loans at almost the same interest rates, at affordable prices. This might improve the automobile sales and housing sales ahead of the festive season in the country, as people will be inclined to take loans at lower rates. The real estate segment in the country has only started to recover, slowly. The repo rate unchanged at 4% will certainly help the sector to develop in this quarter more.

Interest rates of home loan

Already both public sector and private sector banks have eased their home loan interest rates. SBI and HDFC are offering home loans at 6.70%, PNB at 6.80%, Bank of Baroda at 6.50%, Canara Bank at 6.90%, and Kotak Mahindra Bank at 6.50% interest rates. These are quite affordable rates keeping the historical data in mind.

Opinions of the real-estate industry insiders

Anuj Puri, Chairman, ANAROCK Group told Goodreturns.in, "In short for home-buyers, the low home loan interest rates regime will continue in the market and help foster housing demand during the ongoing festive season. Notably, this is a period when housing sales usually surge on the back of attractive offers by developers and lending banks."

Anuj Puri added, "The green shoots of economic revival coupled with the prevailing low-interest rates will be conducive for the residential sector in the short to mid-term. ANAROCK Research indicates that we may see at least 10-15% growth in housing demand in the ongoing festive period (Oct.-Dec) across the top 7 cities against the preceding quarter. In Q3 2021, the top 7 cities saw total housing sales of nearly 62,800 units - already the best quarterly sales since the pandemic. If ANAROCK's predictions are accurate, the ongoing festive quarter will see at least a 35-40% yearly rise in overall housing sales across the top 7 cities as against the same period in 2020. In Q4 2020, the top 7 cities saw total housing sales of nearly 50,900 units."

In addition to that, Amit Goyal, CEO, India Sotheby's International Realty commented on the RBI's 4% repo rate, "We welcome RBI's status quo on policy rates. This will mean a continuation of low home loan rates, which will keep the demand momentum for homes going. In the past couple of months, we have witnessed a further reduction in interest rates of home loans to 6.5% per annum by leading financial institutions."