The RBI maintained the status quo at its monetary policy meeting on Wednesday, continuing with its accommodative policy stance for home loan borrowers. Industry experts and realtors believe it is in line with expectations and will work as a spur for economic growth.

Despite the fact that the rate has fallen from its highest in June 2021, when it was above 6%. The MPC meeting took place at a time when the country is dealing with high inflation.
However, compared to the same quarter last year, when a statewide lockdown caused by the Covid-19 outbreak had halted nearly all economic operations. The economy increased at a record rate of 20.1 percent in the April-June quarter. The pandemic and lockdown provided a silver lining for the real estate industry; which serves as a safe haven and a tangible asset during times of crisis. In the last two years, this has resulted in increasing investment and property purchases. Low house loan interest rates have played an important role in boosting India’s real estate market; particularly during the festival season. As a result, the real estate sector’s sentiment remains favorable. Which is evident by the S&P BSE realty index’s upward trajectory,” said Ram Raheja, director of S Raheja Realty.

Adequate liquidity in the system and a low-interest rate regime are crucial for further strengthening the home loan market. While the RBI announced additional measures to reduce excess liquidity, it assured that sufficient liquidity will be maintained as needed.
Positive emotions will strengthen by the RBI’s forecast of 9.5 percent GDP growth in FY 22. However, the regulatory agency may consider lowering the repo rate by 25 basis points to help the market’s liquidity. Increased liquidity and expenditure will benefit corporates, companies, and small and medium-sized organizations in India, resulting in increased growth.