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The real estate sector remains optimistic ahead of the Reserve Bank of India's upcoming Monetary Policy Committee (MPC) decision. After benefitting from a cumulative 100 basis point reduction in repo rates over the past few reviews, developers and industry experts expect the RBI to continue with a supportive stance. Many believe that with inflation under control and consumer sentiment remaining high, another modest rate cut could further strengthen housing demand and affordability. Even if rates remain unchanged, the prevailing low-interest environment is already fuelling momentum across residential markets.
The Reserve Bank of India's Monetary Policy Committee (MPC) meets every alternate month to evaluate the country's economic climate and determine policy rates aimed at containing inflation and fostering growth. The real estate sector, among others, closely follows these decisions due to their significant impact on borrowing costs, consumer sentiment, and market activity. Advertisement
Following a cumulative reduction of 100 basis points in the repo rate between February and June 2025, the housing sector has seen a notable revival. Experts have indicated that improved loan affordability and revived buyer interest are driving renewed traction across major markets.
Industry stakeholders are hopeful that this trend will continue. With inflation under control, many believe there is scope for the RBI to initiate another cut in the policy rate. According to Mr Pradeep Aggarwal, Chairman of Signature Global (India) Ltd., the present economic conditions could permit a fourth consecutive rate reduction. He noted that an additional 25 basis point cut would further support consumption and provide another boost to the property market, especially with banks already offering interest rates below 8 percent. He added that even if the RBI opts to maintain the status quo, the current lending environment remains conducive to homebuyers, aiding in sustained demand.
Mr Jash Panchamia, Executive Director at Jaypee Infratech, echoed this view, pointing out that the RBI's neutral approach in the last review left open the possibility of either a pause or a rate cut. With inflation reportedly at a six-year low, he suggested that a further 25 basis point cut would bolster the sector's ongoing momentum and benefit both demand and buyer confidence-especially among first-time homebuyers.
Mr Ashok Kapur, Chairman of Krishna Group and Krisumi Corporation, remarked that the 100 basis point cut already enacted has contributed to a measurable increase in housing demand. Should the RBI decide on a further 25 basis point reduction, it would provide another stimulus not just for real estate but also for the broader economy. He said reduced loan rates enhance affordability and attract more homebuyers, reinforcing the growth already observed.
According to Mr Raoul Kapoor, Co-CEO of Andromeda Sales and Distribution Pvt Ltd, this year's three successive rate cuts-comprising two 25 basis point reductions and one 50 basis point cut-have significantly aided credit growth. While he considered another aggressive rate cut unlikely, he suggested a moderate 25 basis point reduction is possible given stable inflation, improving geopolitical conditions, and a resilient domestic economy. He added that such a decision would be well-timed with the upcoming festive season, a period typically marked by heightened consumer and housing purchases.
Mr Vikas Bhasin, Managing Director of Saya Group, also anticipated another rate cut in the range of 25?50 basis points. He remarked that previous reductions have already improved affordability and expanded loan eligibility for homebuyers, stimulating interest across both affordable and premium housing segments. A further cut, he said, would deepen demand in the months ahead.
Mr Sushil Bedarwal, CMD of Bedarwal Group, highlighted that the earlier cuts had been particularly beneficial for affordable and mid-income buyers, who rely heavily on credit. He expressed confidence in another 25 basis point reduction, citing prior MPC commentary hinting at further easing. He also emphasised the need for banks to quickly transmit any policy rate cuts to customers, arguing that enhanced credit access could empower many more aspiring homeowners.
A further 25 basis point cut is seen as a potential catalyst to maintain the sector's momentum, especially with the festive season approaching. Even in the absence of further easing, prevailing interest rates continue to encourage end-users to take buying decisions, keeping the sector on a steady growth trajectory.
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