Realtors Rely On High Consumer Confidence

With the optimism of RBI for a strong rebound of the GDP and inflation to ease to projected target by Q4 of FY'21, real estate sector too is upbeat about economic growth. Prateek Mittal, Executive Director, Sushma Group, said, "At this time when the buyers are seeking stable investment options, real estate sector with low-interest rates emerges as the safest investment proposition and the all-time low repo rate is adding impetus to the same."

Uddhav Poddar, MD, Bhumika Group & Founding Member, SCAI, said, "The real estate sector is badly affected due to the pandemic, and it needs support from the banks. One of the biggest issue with some of the realtors is the liquidity issue, and we hope RBI will address it as it has announced to take steps to ease liquidity. One of the announcements that are beneficial for the sector is that the new housing loans to be linked to LTV only. We hope that the buyers will take advantage of the situation and realize their dream of owning a home."

The realtors feel that the RBI should have made some announcement to improve liquidity in the real estate sector, as many developers are facing the heat after COVID-19 led to complete shutdown of operations.

Nagaraju Routhu, CEO, Hero Realty, said, "Decision of the RBI to keep repo rates unchanged is along expected lines. RBI's commentary on the economy gives hope for the revival of the real estate sector in the coming quarters. The sector, however, needs handholding by the Government and the RBI to tide over this difficult period. Measures to boost liquidity for the sector are urgently needed. The optimism about economic growth cannot ignore the needs of the common man who is still in 'cautious spending' mode. The good part is that the real estate sector is getting attention by the buyers as they have realized the safety of real estate asset, but they do look towards sops from the government that can help them in realizing their dream of owning a home."

Ashish Bhutani, MD & CEO, Bhutani Infra, said, "The bank should have taken into consideration the need for liquidity. The apex bank has also talked about improving liquidity in the market, which will have a direct bearing on the real estate too. Like the RBI we too are optimistic about the economic growth. Having said that we were hoping for announcements that can specifically talk about various sectors and how banks are going to help improve growth. However, we are upbeat as the consumer sentiment is high, especially after they witnessed the brittle nature of other investment vehicles as against real estate."

Saying that the decision to keep the repo & reverse repo rate unchanged underpins the accommodative policy by the government alongside reining the inflation rate, Ankit Kansal, Founder & MD, 360 Realtors, pointed out "This should have an overall positive impact on the recovering Indian Real Estate industry as the accommodative stance should plug-in the liquidity crunch in the market. Likewise, managing inflation will control the cost. At the same time, the RBI has announced a sharp GDP decline of 9.5% for FY 21, which is in line with what has been predicted by most of the major international & domestic rating agencies. Now all eyes would be on how the government plans to combat the economic slowdown and boost demand. A host of steps in the form of capital injection, refinancing of banking institutions, policy impetus, subsidies, and discounts are required to see a faster recovery."

Pradeep Aggarwal, Founder & Chairman - Signature Global Group & Chairman - ASSOCHAM National Council on Real Estate, Housing and Urban Development, was of the view that "It was an expected move by the RBI to keep the repo rate unchanged, and it is commendable that it is doing its part to ensure that the economy stays on the right path. Loan on LTV will be helpful for the real estate sector, and it will help them get more loan amount."