RBI cuts repo rate; EMIs set to fall
In a surprise move the Reserve Bank of India (RBI) has announced a cut of 25 basis point cut in its benchmark interest rates, ahead of its February 3 policy review. The reduction in repo rates will escalate the downward movement of deposit rates which translates into lower rates for borrowers. The banks which did not revise their benchmark base rates during the last year are expected to do so now. Experts feel that this move would give a positive signal that RBI is now focused on growth, as the inflation was finally under control. The RBI's repo rate now stands reduced to 7.75% from 8% earlier.
The move brings cheers to real estate sector and MakaanIQ brings forward the sentiments of some major realty developers.
Ajay Kumar, CMD Ace Group says, "The RBI cut of 0.25 basis in the repo rate has given a ray of hope in improving the economic condition of India in general and real estate sector in particular. Consequently, it is now expected of the banks to further cut down interest on home loans accordingly to give a boost in the buying spree which has been witnessing sluggish sales in the entire country. RBI’s decision is an indication that the good days are ahead now as it is being observed that the oil prices in the international market have also come down paving the way in consolidating the rupee against dollar and there is an improvement in bringing down the inflation also. Therefore this is a good sign and the real estate sector still look forward to RBI take the drastic steps in its forth coming monetary policy after the presentation of the Union Budget of 2015 to revive the market."
Mr. Manoj Gaur, MD, Gaursons India ltd & President CREDAI Western UP says; We are happy by this move of RBI as this decision will bring a huge relief to the sector which was battling through tough times. The existing and upcoming buyers were eagerly waiting for this to happen since last year. Now with this move we expect the sales to improve as more potential customers will think of buying homes as the interest rates will be reduced. Now we have to wait and see that when will the banks and Home loan providers will reduce the interest rate. I think the year has started on a good note.