Real estate industry unhappy over RBI's policy
New Delhi: Real estate firms and property consultants Tuesday expressed disappointment over RBI's decision to keep rates unchanged and said the sector urgently needs cut in interest rates to boost housing demand.
"There is once again disappointment from RBI. There was no change in the rates in previous policy announcement and the real estate sector was expecting a rate cut this time," said Lalit Jain, President of the apex realtors' body CREDAI.
"We don't see any positive policies from government which will boost the real estate sector and economy as well," he added.
The Reserve Bank Tuesday left key interest rates unchanged.
Property consultant CBRE South Asia Chairman and Managing Director Anshuman Magazine said: "The RBI's decision to keep the rates unchanged is very disappointing. The real estate market direly needed a rate cut to boost investor sentiment".
The realty sector is the growth-engine of the nation's economy, but it seems the sector does not figure in RBI's policies at all, Magazine added.
Cushman & Wakefield Executive Managing Director, South Asia Sanjay Dutt said RBI maintaining status quo on policy front is not positive news for both home buyers and developers.
"For the housing sector, this may not be a very positive news as end-users, who have been postponing their purchase decision on account of still high inflation and high interest rates, cannot expect any relief in the near future," Dutt said.
The outlook for the sector remains cautious as persistent high inflation rates are keeping construction costs up, which are not expected to come down in the near future, Dutt added.
Expressing displeasure over RBI's decision, M3M, Head-Finance Gaurav Jain said: "We expected some rate cuts from the first quarter review by RBI, however RBI kept the key rates unchanged."
"We need to understand that the inflation Tuesday is not due to high demand, but supply constraints which lead to continuous increase in the input costs, including the cost of funds," Jain added.
CHD Developers Managing Director Gaurav Mittal said the growth of the real estate sector would be fuelled only by a rate cut.
"We hope Reserve Bank will take cognisance of this fact and we will see a rate cut in the next policy," Mittal added.