Realtors see no adverse impact of rate hikes on housing demand

NEW DELHI: Real estate developers on Tuesday said RBI's decision to tighten the monetary policy would not have a negative impact on housing demand, as they do not foresee any increase in home loan rates.

"It's a very balanced and calibrated announcement meant to control inflation. The signals from the PSUs as well as private banks are favourable and they expect no increase in home loan rates. This will be the ultimate interest of the home buyers," DLF Group Executive Director Rajeev Talwar said.

Talwar said housing demand would remain firm. Parsvnath Developer's Chairman, Pradeep Jain, said: "I do not foresee interest rates going upwards. Therefore, there is no concern for the real estate sector."

In a move to rein in the runaway inflation, the apex bank today increased the repo and reverse repo rates by 25 basis points each and the CRR also by 25 basis points.

Property consultants also feel that the hike in policy rates would not have any significant impact on the housing sector, which has witnessed a revival in demand for the last one year.

"It was on the expected lines. This would have a sentimental and emotional setback on residential demand, not on office or retail," Jones Lang LaSalle Meghraj country head Anuj Puri said.

However, he cautioned that a continuous increase in the repo rates would curtail the optimistic sentiment of the real estate sector.

Knight Frank India National Director, Residential Agency, Anand Narayanan said, "Real estate is having a strong sentiment now. This will not have any significant impact on the buyers."