The Reserve Bank of India (RBI), in its Monetary Policy Committee (MPC) meeting, announced that the repo rate will remain steady at 6.5%, as revealed by Governor Shaktikanta Das on Friday, December 6, 2024.
This marks the 11th consecutive instance where the repo rate has been left unchanged. Additionally, the RBI has reduced the cash reserve ratio (CRR) by 50 basis points, bringing it down to 4%. The real estate sector has also expressed its views on these decisions.
Manoj Gaur, CMD of Gaurs Group and Chairman of CREDAI National, said, “We once again applaud the RBI move to keep the repo rate unchanged. Given that retail inflation climbed to 6.21% in October, surpassing the RBI’s target range for the first time in a year, the decision by MPC to maintain the status quo on the repo rate is a welcome move.
“The move showcases the central bank’s commitment to bolster growth, which ultimately will also benefit the real estate sector. The sector is doing good all over the country and this move will definitely keep the bull run continue in real estate.
Pradeep Aggarwal, Founder & Chairman, Signature Global (India) Ltd, said that the continuity will provide a stable environment for the real estate sector, enabling developers to plan with confidence and homebuyers to benefit from favorable borrowing costs.
“However, a rate cut in the future could infuse much-needed liquidity into the real estate sector, accelerating growth and enhancing accessibility for buyers. As India continues to experience robust economic activity, this stable monetary stance will act as a catalyst for long-term growth and investment across industries.”
Amit Modi, Director County Group, welcomed the move, saying that the decision will help the real estate sector continue with its upward trajectory.
“Despite some inflationary concerns, the current move speaks of India’s resilient growth and resurgent economy. Further, a 50 bps cut in CRR, also announced by RBI, will free up Rs 1.16 lakh crore liquidity for the banks and increase the money supply. It will boost the country’s growth, enabling the real estate sector to scale new heights,” Modi said.
Sandeep Chhillar, Founder and Chairman of Landmark Group, said, “the reduction in the existing repo rate would have been a great push for fence-sitters planning to take loans anticipating lower EMIs. The housing segment is witnessing exceptional growth numbers across cities, especially for the luxury housing segment. Keeping in mind the high demand and strengthened market sentiments, the realty sector is likely to sustain high growth momentum for the coming year.”
Mohit Kalia, Vice President (Sales) Raheja Developers, welcomed the decision, saying that this stability is important as it affects consumers’ purchasing power and equally affects the sector’s growth.
“Also, it shows the government is considerate of buyers’ sentiments and expectations and supports the sector’s overall growth, significantly contributing to India’s GDP and future growth prospects. Thus, the sector shall once again reap its benefits,” Kalia said.
Sanjeev Arora, Director 360 Realtors, said, “By keeping the repo rate steady at 6.50% for one more time, the RBI has once again provided relief to both homebuyers and developers. The real estate sector continues to thrive, with growing interest in mid-range, premium, and luxury housing segments. This positive move is expected to maintain the sector’s upward momentum, benefiting all stakeholders involved.
Prateek Tiwari, Managing Director, Prateek Group, said, “Keeping the inflation in view, the RBI has maintained the repo rate at 6.5% for the 11th consecutive time. The decision fosters stability amid the rise in housing demands. Besides, less volatility in the loan rates would instil greater confidence in the buyers and developers, welcoming long-term growth. We remain optimistic that this continued support will propel the rising demand in the real estate market, leading to lower rate cut in the future.”
Kushagra Ansal, Director Ansal Housing, pointed out that the RBI’s decision is a commendable move for the real estate sector. With the economy demonstrating strong performance, supported by robust GDP growth and controlled inflation, the sector is poised for continued success.
Rajjath Goel, Managing Director, MRG Group, said, “The RBI’s decision to hold the repo rate at 6.5% is a significant enabler for the real estate sector. Stable borrowing costs bolster buyer confidence in high-value investments, especially in emerging luxury hubs like Gurugram. This move supports a sustainable growth trajectory for developers, encouraging innovation and premium offerings tailored to the evolving aspirations of discerning clients.
Saurab Saharan, the Group Managing Director of HCBS Developments, said, “RBI’s decision to maintain the repo rate at 6.5% is expected to bring favorable growth to the housing market. Despite rising housing expenses, unchanged home loan rates provide relief to potential home buyers. As a result, stable interest rates benefit both buyers and developers, boosting confidence and investment in the sector. The RBI’s decision is poised to encourage the launch of new projects and support development in emerging areas of interest.”
Uddhav Poddar, CMD, Bhumika Group, however stated that the real estate industry would definitely benefit from a rate cut as the repo rate influences housing affordability and loan repayment terms, which is directly connected to the real estate sectors momentum.
Yash Miglani, MD of Migsun Group, said that India is firmly on the path of progress, and the Reserve Bank of India’s decision to keep the repo rate unchanged will further motivate the sector.
Welcoming the RBI’s decision, Sanchit Bhutani, MD, Group 108, warned that the surge in metal prices could pose inflationary challenges.
Ambika Saxena (Director, Corporate Communications at Bayside Corporations), Neeraj Sharma (MD, Escon Infra Realtor), Harsh Gupta (CEO of Sundream Group), Ravindra Gandhi (Managing Director of Tirasya Estates), and SKA Group Director Sanjay Sharma also welcomed the move, expressing optimism for the real estate sector.
Ajendra Singh, Vice President of Sales and Marketing at Spectrum Metro, however, stated that RBI could have considered revising the rate by up to 25 basis points, as it would have further supported the economy. The Indian economy is expected to grow at a rate of 7% in FY25, making it one of the fastest-growing markets at a time when global growth is mostly sluggish. A reduction in CRR will bring liquidity into the market. This is bound to lead to a market rally.
Other real estate leading names to welcome the RBI’s decision are Ashwani Kumar (Pyramid Infratech), Piyush Kansal (Executive Director of Royale Estate Group), Manit Sethi (Director, Excentia Infra), Salil Kumar (Director – Marketing & Business Management, CRC Group), Prakash Mehta (Chairman and Managing Director of Ocus Group), Gurpal Singh Chawla ( MD, TREVOC), Dr. Gautam Kanodia (Founder of KREEVA and Kanodia Group), Prateek Mittal (ED, Sushma Group), Pawan Sharma (MD, Trisol RED), Nandni Garg (Director, Rajdarbar Ventures), Aman Sarin (Director & Chief Executive Officer, Anant Raj Limited), Prashant Sharma (President, NAREDCO Maharashtra), Kuldeep Jain (Founder & CEO of Build Capital) and Vikas Sutaria (Founder, Iraah Lifespaces).
Anil Mutha (Chief Visionary & Co-Founder, Nandivardhan Group), Shraddha Kedia-Agarwal (Director, Transcon Developers), Rohan Khatau (Director, CCI Projects), Samyak Jain (Director, Siddha Group). Govind Krishnan Muthukumar (Managing Director & Co-Founder, Tridhaatu Realty), Vedanshu Kedia (Director, Prescon Group), Abhishek Jain (COO, Satellite Developers Private Limited) (SDPL) and Samir Jasuja (Founder & CEO, PropEquity) welcomed the Reserve Bank of India’s decision to maintain the repo rate at 6.5%.