If you have taken a home loan or were planning to go for one in the near future, here’s good news for you. As widely expected, the RBI maintained status quo on key policy rates in its December monetary policy on Wednesday. While no change in the repo rate was expected, there was the possibility of the reverse repo rate being hiked, which also didn’t happen.
Commenting on the same, Anuj Puri, Chairman, ANAROCK Group, said, “With Omicron throwing a shadow of doubt across the world and in India, the RBI has decided to keep the repo rate unchanged at 4% and the reverse repo rate at 3.35%. This was expected, and is the ninth consecutive time that the RBI maintained status quo amid current uncertainties.”
The unchanged repo rate will help maintain status quo on the prevailing low interest rate regime for some more time. “This works well for all home loan borrowers as the environment of affordability will continue,” added Puri.
Welcoming the RBI’s status quo on policy rates, Amit Goyal, CEO, India Sotheby’s International Realty, said, “This means that the home loan interest rate will remain at the current level of sub 7% per annum. Besides that, the Governor rightly said in his statement that recent reduction in excise duty and state VAT on petrol and diesel will support consumption demand by increasing purchasing power. We expect demand in the housing market to improve further. All eyes are now on the upcoming budget. It will boost the real estate sector if the government enhances deductions against home loans in the Budget 2022.”
Industry experts said this accommodative stance will aid demand dynamics and propel economic growth to mitigate the impact of Covid-19.
“This will support the RBI’s vision of GDP growth of 9.5% for the year. At the same time, the growth will also hinge upon the new variant of Covid-19 and its impact. The unchanged repo rate will continue to improve sentiments in the real estate sector. The housing sector is already seeing a revival in sales, led by low home loan rates, pent-up demand, and stable prices,” observed Ramesh Nair, CEO-India, and Managing Director, Market Development-Asia, Colliers.
This may also be the right time to buy your dream home as the interest rates are at a record low level currently and the situation may not remain the same going ahead.
Suren Goel, Partner, RPS Group, said, “The RBI decision to maintain status quo on the interest rate means home loan rates will continue to remain at a record low level. This augurs well for the housing sector and the real estate sector as a whole. With reasonable prices, lower interest rates and sufficient option to choose from, this is perhaps the best time to buy a dream home and we are hopeful of witnessing an uptick in demand.”