The Reserve Bank of India’s (RBI) decision to pause the monetary policy would help foster the housing demand during festival season, a real estate expert said on Friday.
New Delhi [India], October 8 : Welcoming RBI’s decision, the chairman of ANAROCK group, Anuj Puri said, “RBI maintained the monetary policy pause; in short, for homebuyers, the low home loan interest rates regime will continue in the market and help foster housing demand during the ongoing festive season.” “Notably, this is a period when housing sales usually surge on the back of attractive offers by developers and lending banks,” he added.
Puri said research by the ANAROCK group indicated that at least 10-15 per cent growth may be seen in the ongoing festive period (October-December) across the top seven cities against the preceding quarter.
“In quarter three of 2021, the top seven cities saw total housing sales of nearly 62,800 units – already the best quarterly sales since the pandemic,” Puri added.
If ANAROCK’s predictions are accurate, the ongoing festive quarter will see at least a 35-40 per cent yearly rise in overall housing sales across the top seven cities as against the same period in 2020.
“In quarter four of 2020, the top seven cities saw total housing sales of nearly 50,900 units,” he informed.
Notably, the repo rate has remained unchanged for the eighth time and has continued with an accommodative policy stance for ‘as long as necessary to revive and sustain growth on a durable basis’.
The policy decision has been taken to mitigate the impact of COVID-19 on the economy while ensuring inflation remains within the target, RBI Governor Shaktikanta Das said.
“The MPC has been given the mandate to maintain annual inflation at 4 per cent until March 31, 2026, with an upper tolerance of 6 per cent and a lower tolerance of 2 per cent,” he said.
RBI had last revised its policy repo rate, the central bank’s lending rate, on May 22, 2020, in an off-policy cycle to perk up the demand by cutting interest rate to a historic low.
The repo rate — the central bank’s lending rate — remains unchanged at 4 per cent and the reverse repo rate — borrowing rate — at 3.35 per cent.
“The worst of the second wave is behind us, and substantial pickup in COVID-19 vaccination, giving greater confidence to open up and normalize economic activity,” he added.