This is what RBI repo rate hike will make homebuyers do

Realty players are not enthused by Reserve Bank of India’s move to increase repo rate saying that it will adversely impact the homebuyers' sentiment. They said that RBI could have taken a pause, especially when the Centre is pushing a slew of decisions such as affordable homes, housing for all and creation of a stressed assets fund for the revival of the sector.

Knight Frank India CMD Shishir Baijal said the increase in the policy rate was expected given the current inflationary trend. “However, looking at the challenging residential market scenario, we were hoping that the RBI would have paused the rate hike, thereby providing a fillip to the buyer sentiment.”

National Real Estate Development Council president Niranjan Hiranandani said from a real estate perspective, the hike will negatively impact buyer sentiment, which will impact sales. “Real estate industry hopes the government comes up with initiatives that enhance buyer sentiment and give it a boost.’’  According to Ajmera Group director Dhaval Ajmera, RBI’s move may further dampen the already low spirits of the sector, making the home loans more expensive.

However, Anaroc Property Consultants chairman Anuj Puri justified rise in repo rate saying that it may lead to a hike in home loan rates but the overall real estate sector now rests on a strong footing and buying decisions may not be altered by these marginal changes.

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‘’With lucrative deals on the table, serious end-user demand is back on the market and marginal hikes in home loan rates are unlikely to deter buyers who have been sitting on the fence for some time now, waiting for the right time to seal the deal.’’

Source: DNA