The 50 basis points hike in the repo rate coupled with inflationary pressure is likely to impact the sentiment of the Housing sector particularly in the affordable and mid-range housing segments.
While the hike is on the expected lines, the Real Estate developers and experts said that the corresponding hike in the home loan rates is likely to impact the housing sales during the upcoming festive season.
"The current 50 BPS repo rate hike by RBI now makes it higher than the pre-pandemic levels. At one level it reflects the confidence in the economy and future growth outlook, at another level it was necessitated by the recent global developments such as the Russia-Ukraine conflict, including aggressive monetary policies pursued by global central banks.
"Even though it will have a marginal impact on the real estate sector, I wish RBI had deferred this increase for the post-festive season. The buyers sentiments so far have remained buoyant towards residential real estate signalling the preference for real estate as an asset class. We are confident the buoyancy will remain intact," said Manoj Gaur, President CREDAI-NCR & CMD, Gaurs Group.
Even though the quantum at present is still 5.9 per cent it will definitely impact the long-term growth of the real estate market as this rate hike not only raises it above the pre-pandemic levels but also takes away the psychological cushion with the possibility of a further increase in the interest rates," said Nayan Raheja, Raheja Developers.
"With this repo rate hike, home loans will get dearer soon. This could impact residential sales to some extent during the upcoming festive quarter, particularly in the affordable and mid-range housing segments. The hike in home loan rates will be in addition to the other increasing costs such as inflationary trends of construction input costs. With the overall acquisition cost increasing further, developers will have to seriously consider doling out targeted offers and discounts to boost sales during the critical festive quarter," said Anuj Puri, Chairman, Anarock Group.
Middle-income groups or homebuyers from the affordable segment may suffer a minor hurdle, but there would not be any major difference in the overall growth of the sector. The real estate sector has already been doing quite well as per the recent trends, and this decision by the government would bring it more growth," said Amit Jain, Director, Mahagun Group.
AdaniConneX establishes India's largest sustainability linked financing to raise up to $1.44 billion
In a bid to accelerate digital infrastructure growth in India, AdaniConneX, a JV between Adani Enterprises and EdgeConneX, on Sunday said it has established the country’s largest sustainability-linked financing to raise up to $1.44 billion.
Credit card data of 17K ICICI Bank users exposed; bank blocks cards, assures compensation
After credit card data of at least 17,000 new ICICI Bank customers was exposed and reached "wrong users", the bank said on Thursday that it has blocked these cards and is issuing new ones to the customers.
NDA rule has shown superior numbers on GDP growth, inflation, unemployment compared to UPA
The NDA rule of the last 10 years has shown superior numbers on GDP growth, inflation, CAD (Current Account Deficits), unemployment and FDI ex of pandemic year compared to the UPA regime, broking firm Prabhudas Lilladher said.
RBI crackdown triggers crash in Kotak Bank shares
The RBI had, on Wednesday evening, barred Kotak Mahindra Bank, with immediate effect, from taking on new customers and issuing fresh credit cards.
Kotak Bank promoter donated electoral bonds worth Rs 60 cr, but RBI cracks down on lender to protect customers
Infina Finance, one of the promoter group entities of Kotak Mahindra Bank which was barred by the RBI on Wednesday from onboarding new customers, had donated electoral bonds worth Rs 60 crore to the BJP.
RBI lists 6 factors powering India’s take-off to become world’s 3rd largest economy
While India’s recent growth performance has surprised many, triggering a flurry of upgrades from financial institutions such as the IMF, the RBI bulletin released on Tuesday cites six factors that will propel the country to become the world’s third-largest economy.
Congress in Tripura blocks rail stations to protest police fired-killing of 5 farmers in MP
The firing on Tuesday came during raucous protests to demand better crop prices in the drought-ravaged region that saw one farmer suicide every five hours in the past two years.
DMs, SPs of violence-hit MP districts transferred
The farmers agitation entered its eighth day on Thursday. The peasants have been on strike since June 1, demanding loan waiver and fair price for their produce.