Our nation’s apex bank, Reserve Bank of India is always on the move for the betterment of Indian economy and country as a whole. RBI has played a humungous role in spurring the growth and GDP of the country. Because of RBI home loan interest rates have come down under 10% for the first time in many years and thus the demand for housing has spiked. But RBI seems to be just warming up because it is at it once again.
RBI slashed its all important repo rate by another 25 basis points, for a whopping 3rd time this year, in a bid to boost growth and development in the economy. This RBI’s game changing maneuver to reduce rates once again will in all likeliness lead to a significant reduction in the borrowing costs incurred by both real estate developers and buyers alike, thus leading to some much needed boost to the demand for housing in the country. Demand has been quite sluggish in the realty arena of the nation for past few years but the recent rate cut by RBI just might change that.
A major chunk of immensely reliable experts hailing to the real estate industry of the nation have given thumbs up to RBIs strategic move. Many experts are rightly of the belief that commercial banks should pass on the benefits of the repo rate cut to their esteemed customers and that the prevailing interest rates should be in the range of 9 to 9.5% per annum and not more than that. Way cheaper home loan interest rates will reduce the costs of buying a home and therefore more and more people will be able to afford their dream home.
CREDAI, the apex body of real estate however was expecting more from RBI. Although it has appreciated and hailed the rate cut, CREDAI feels it is less. The market too was expecting a bigger rate cut which partially reflected in Sensex tanking by close to 600 points. But some rate cut is surely better than nothing whatsoever. The ball is now in the court of commercial banks. If they pass on the benefits of the rate cut to buyers than housing will witness some much needed boom.
People all over the nation are keeping their fingers crossed in the hopes that cutting edge policy reforms and rate cuts will be continued for the foreseeable future, as such moves bring back realty customers and investors back into the market. RBI has cut repo rate by a staggering .75% since January of this year and more can b expected from the apex bank if it translates into lower lending interest rates by commercial banks.
This rate cut is expected to extend a stimulus to not only residential and commercial real estate but also to manufacturing and ancillary industries as well. Thus the economy is definitely on the right track as all the right steps are being taken by the relevant authorities. Growth and revival in housing sector might become a reality pretty soon.