More push needed with government support to bring back influx of fence sitters: Realtors
In the latest RBI MPC, the real estate sector did not get anything substantial, but the realtors are taking positives from the RBI’s stance of status quo in repo rate. Realtors say that “in the latest MPC, it’s clear that the apex bank is optimistic about economic growth. In addition, the RBI has taken measures for various industries and sectors that will help in growth.”
Thanking the apex bank for continuing with the accommodative stance, Pradeep Aggarwal, Founder & Chairman, Signature Global Group, Chairman, ASSOCHAM, National Council on Real Estate, Housing and Urban Development, said, “The low home loan interest rate has been a crucial demand by real estate, and the RBI has helped the sector by maintaining the status quo. We would suggest that the buyers take advantage of the current situation because later prices might go upwards under the pressure of increased costs.”
When everyone is struggling with liquidity, the announcement of G-SAP 2.0 will ensure adequate liquidity in the system. Amarjit Bakshi, CMD Central Park, said, “The MPC has taken an unconventional measure of On Tap liquidity window for contact intensive sectors to help segments such as hotels, tourism, salons, aviation ancillary services, etc. Though we were expecting real estate specific announcements, we understand that the RBI must focus on every sector for economic growth. For real estate, maintaining the repo rate will help a lot as it will help in retaining the buyer sentiment.”
Uddhav Poddar, MD, Bhumika Group, said “While it is acceptable that the repo rate remains steady, the need for industry specific steps cannot be overlooked. While buyers were returning to real estate but after the second wave has hit us the demand has once again muted, hence to once again be spur demand, interest rates need to be further reduced and thereby making realty assets more attractive with low EMIs.”
Though residential buyers are getting encouragement through historically low EMIs, the commercial segment has not got any initiative that can boost the growth of this segment. “We expected the RBI to make special announcements for the commercial sector that would stimulate investment. The segment is in need of liquidity, which is also dependent on the status of priority lending, and we are hopeful that the segment will receive adequate liquidity now that the RBI last announced that TLTRO available to NBFCs is extended till September 2021,” said Mr. LC Mittal, Director, Motia Group.
Nayan Raheja, Executive Director, Raheja Developers, said, “The apex bank repo rate announcements directly impact the economic development in the country. Consumers borrowing more or less from banks is the deciding factor for inflation. RBI has taken decision to keep a check on that. As the industries are facing this kind of slowdown for the second time in just a span of a year, industry-specific mitigating measures become the need of the hour. The value of the real estate as an asset will continue for long, and strengthen with time as the industry begins to recuperate; low home loan interest rates have worked really well for the sector. Additionally, more push is needed with support from govt. to bring back the influx of fence-sitters in the market.”
“Though real estate needs several measures, it will be good to implement the announcements made in the last few months to achieve progress. We expect banks to disburse loans more quickly to ensure that the sentiment of buyers remain high,” concluded Mr. Nagaraju Routhu, CEO, Hero Realty.
