Dr Niranjan Hiranandani -National Vice Chairman NAREDCO stated, “The Economic survey evidently indicated the upward growth trajectory of the Indian economy, corroborated by RBI pegging the FY23-24 GDP growth rate at 6.4%. Indian economic resilience is reflected with improved capex, enhanced capacity utilization, and improved urban and rural consumption, augmented investments and jobs creation. The geo-political tumultuous recession signals, and weakening of western economies will reorient the growth scale towards the booming economy of India. This phenomenon will continue to draw high global traction which will fuel the demand across the real estate asset classes. The pricing index of the affordable housing segment will have detrimental cascading impact due to projected sticky core inflationary trend.
Though surplus liquidity will power credit growth in the real estate sector, demand economics may be challenged in the affordable house segment – which is the broad spectrum of the consumption pyramid.
The outrageous hike of 250 basis point since May 2021, needs to be warranted before it turns negative for the ascending Indian economic growth curve. The impact of home loan interest rate hike will be highly deterrent in the affordable housing segment as it will impact the price sensitive homebuyers and fatigue the supply of the developers. The luxury and mid housing segment players will remain cautious with a bit longer sales cycle.”
Harsh Vardhan Patodia, President, CREDAI National said, “While inflation has steered northwards in these unprecedented situations and with RBI continuing to maintain its stance on the monetary policy, the call for raising the repo rate further would not fare well for home buyers.
Today’s decision marks a massive rise of 250 points since last year. However, global economies across the world have maintained a similar stance and the continuous increase in interest rates will dampen the sentiment of borrowing for individuals and businesses alike.
For India to emerge as a trailblazer in these circumstances, it would be important for RBI to keep a keen vigil on the external factors influencing growth and we hope the next MPC meeting will focus on a neutral stance that helps boost the economy in the long run."
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