The RBI’s decision to keep the repo rate at 5.5% has greatly ensured the much needed stability for India’s housing sector, thereby supporting steady EMIs and boosting consumer confidence. Experts predict sustained growth in the premium housing demand and developer activity as we go festive season approaching,
The Reserve Bank of India's (RBI) decision to maintain its repo rate at 5.5% points to a measured approach providing stability. The RBI is seeking some stability during its observations of the consequences of its previous monetary policy measures. With borrowing and mortgage terms stabilized, homebuyers achieve an outcome that guarantees their expected EMIs and, at a minimum, visibility on what is likely to happen in the future. Even though a rate cut could help stimulate demand in housing, maintaining stable rates prevents sharp increases in borrowing costs over the longer term from external pressures. Overall, analysts expect consumer sentiment to be stable and, essentially, somewhat supported by earlier announcements, rate cuts, and projected liquidity. From what I observe in the market, the stability in interest rates and easier credit availability is truly helpful. It boosts homebuyers’ confidence to make that important step and encourages developers to introduce new launches at the same time. This is the balance that helps supply housing and keeps the market moving.
Stable interest rates in the housing sector are beneficial and support sustained buyer confidence, providing certainty for developers who rely on timelines and cash flow planning for future projects. The cuts made in the past year have alleviated the initial financial pressure, and stable interest rates give the economy time to fully absorb the effects of the interest rate cuts. For future expectations, if inflation slows down and growth remains stagnant, there are still actions available to the RBI. However, from a housing and real estate perspective, the takeaway on what constitutes a prudent decision is that the central bank is being much more judicious in balancing growth and stability and is more confident in the buyers.”
As per Siraj Saiyed, Director at Arete Group, Despite global challenges like U.S. tariffs and higher visa costs, domestic demand in both residential and commercial segments has remained resilient. GST rationalization—1% on affordable housing and 5% on other residential units has improved affordability, driving a 16% rise in residential sales in H1 2025. Commercial real estate also recorded a 12% increase in transactions across Tier-1 cities during the same period. As India progresses toward its Vikshit Bharat vision, real estate remains a key engine of long-term economic growth.
The RBI’s decision to maintain the repo rate at 5.5% supports economic stability and offers homebuyers predictable EMIs. With real GDP at 7.8% and GVA at 7.6% in Q1 2025, India is well-placed to sustain this growth. Backed by strong fundamentals, GST relief, and festive demand, real estate is positioned to drive employment, investments, and confidence into 2026—cementing its role as a catalyst in India’s growth journey.
As per Vishal Raheja, Founder & MD at InvestoXpert, the RBI’s Monetary Policy Committee’s unanimous decision to keep the repo rate unchanged at 5.5% and maintain a neutral stance provides stability for the real estate sector amid ongoing cost pressures. Steady rates help ensure that home loan EMIs remain manageable, supporting affordability, particularly as housing demand in major metros has risen by 10–12% over the past year. While this decision does not directly stimulate demand, it prevents additional financial strain on developers and buyers. The sector’s sustained growth will depend on broader demand recovery, policy support, and moderation in construction and input costs.
Ashish Kukreja, CEO and Founder of Homesfy.in and mymagnet.io highlighted, “The Reserve Bank of India's (RBI) decision to maintain its repo rate at 5.5% points to a measured approach providing stability. The RBI is seeking some stability during its observations of the consequences of its previous monetary policy measures. With borrowing and mortgage terms stabilized, homebuyers achieve an outcome that guarantees their expected EMIs and, at a minimum, visibility on what is likely to happen in the future. Even though a rate cut could help stimulate demand in housing, maintaining stable rates prevents sharp increases in borrowing costs over the longer term from external pressures. Overall, analysts expect consumer sentiment to be stable and, essentially, somewhat supported by earlier announcements, rate cuts, and projected liquidity. From what I observe in the market, the stability in interest rates and easier credit availability is truly helpful. It boosts homebuyers’ confidence to make that important step and encourages developers to introduce new launches at the same time. This is the balance that helps supply housing and keeps the market moving. Stable interest rates in the housing sector are beneficial and support sustained buyer confidence, providing certainty for developers who rely on timelines and cash flow planning for future projects. The cuts made in the past year have alleviated the initial financial pressure, and stable interest rates give the economy time to fully absorb the effects of the interest rate cuts. For future expectations, if inflation slows down and growth remains stagnant, there are still actions available to the RBI. However, from a housing and real estate perspective, the takeaway on what constitutes a prudent decision is that the central bank is being much more judicious in balancing growth and stability and is more confident in the buyers.”
