In a major and latest developments, the RBI kept the repo rates unchanged to 4% and the reverse repo rate to 3.35% on the monetary policy review meeting today. The decision holds good news for the prospective buyers in the realty sector. Here are the views of industry players on the same:
Pankaj Bansal, Director, M3M Group
The decision of unchanged RBI repo rate and reverse repo rate is a smart move by the government. The government has taken favourable decisions to support the real estate sector in the past few months which has positively impacted the market sentiments and will improve further in the post COVID era. In the past quarter, the sector has seen a robust response in terms of sales across spectrums. This move will further encourage prospective buyers to invest in the realty sector.
Dr. Kunal Banerji, Advisor to the CMD, Central Park
We welcome the move from RBI that aims at keeping the repo rate unchanged. This will ensure an easy flow of money to the people in the country. This has given a positive ray of hope to the consumers who require a home loan and looking forward to possessing a new house. As people want to attain satisfaction and security of owning a house during this pandemic, the boost in this desire is given by the constant rate of interest on home loans, which is not going to rise soon. We expect that this move by the government will give another boost to real estate.
Santosh Agarwal, CFO, AlphaCorp
The decision to keep the RBI repo rate and the reverse repo rate unchanged is again a great step by the government. With the economy growing post unlock, the housing sector is utilizing the opportunities due to various RBI decisions in the past few months. As a result, the sector has witnessed favourable market sentiments and increased sales in the past quarter. This will further continue to encourage banks to lend money to the housing sector and ensure improved credit flow. We hope to see further seamless support to the sector in the post-COVID era. This will revive cash flow in the country and maintain financial stability.
Ramesh Nair, CEO & Country Head, JLL has said, “Higher than expected recovery in Q2 FY 21 GDP reflects the resilience and robustness of the Indian economy. RBI’s decision to hold the policy rate and accommodative stance to revive growth on a sustainable basis augurs well for the economy. This is in spite of the fact that inflation for Apr to Oct 2020 is hovering above the higher limits of RBI’s inflation target."
He further added, "The decision to maintain the policy rate was in line with the real estate sector’s expectations as the sector is just recovering and is yet to bounce back to Pre-COVID-19 levels. Residential real estate witnessed initial signs of recovery with sales increasing by 34% in Q3 2020 over Q2 2020. The RBI’s decision to hold the rate will help homebuyers to avail the benefit of the prevailing lowest mortgage rates. Green shoots of recovery armed with other incentives such as stamp duty reduction in some states and the flexibility of developers in offering best prices/payment schemes will help in further improving home sales.”
Mr. Rajiv Sabharwal, MD and CEO, Tata Capital Said that RBI continues to pause rates for the third consecutive policy. The inflation print seems higher than its comfort corridor which for now is an emerging situation. The complete restoration of supply chain in the near term will bring clarity on the inflation glidepath
The credit off-take revival has so far been slow, but green spouts are visible in certain sectors which must be nurtured. RBI clearly acknowledges the need to further incentivize demand for a broad based activity pickup. RBI maintains its resolve to strengthen growth in the economy
The comfortable systemic liquidity has been key to efficient rate transmission which is seen across the interest rate curve and has shown strong south bias. We may see a gradual unwind and calibrated tightening of excess systemic liquidity in the next quarter. At the same time the markets have been assured of optimum support with no undue liquidity shocks that could impact sentiments
The announcements regarding dividend distribution, scale-based regulatory framework for NBFCs and strengthening of audit systems will bring in more transparency and efficiency to the financial sector.
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