New Delhi: Real estate developers and property consultants on Wednesday hailed RBI's decision to not raise the key policy rates, saying that the bold move by the apex bank would infuse positive sentiments in the property market.
RBI today surprised the markets by leaving key policy rates unchanged, notwithstanding persistent high inflationary pressure. Developers hoped that RBI would soon be able to cut policy rates as inflation is expected to ease.
Commenting on the policy, DLF Group Executive Director Rajeev Talwar said: "It's a welcome step. This is the first sign of recovery. If government can release food stocks to contain food-based inflation then possibly in coming time RBI may be able to take more steps for recovery of the economy.
"RBI governor has taken a bold step by keeping the rates flat," he told the agency.
Jones Lang LaSalle India Chairman and Country Head, Anuj Puri, termed RBI's decision as good news for the realty sector at the end of the year.
"It is positive for the real estate sector as there was anticipation of increase in the interest rates, which would have been damaging for the sentiments of buyers," Puri added.
Parsvnath Developers Chairman Pradeep Jain said the RBI has "acted wisely" by keeping the key rates unchanged.
"Though there was pressure to raise the rates due to the recent rise in WPI inflation, still the apex bank managed to handle it and held the rates at 7.75 percent. This will give a positive signal in the market."
Jain said he expected RBI to cut the key rates if inflation number comes down.
CREDAI-NCR President Anil Sharma said the RBI has "sweetly surprised" both the experts and industry players with its bold decision.
"We, at CREDAI-NCR, could not have asked for more given the high retail inflation of more than 11 per cent. The bold move by the RBI has infused positive sentiments in not only real estate sector but also other sectors of economy," Sharma, who is CMD of Amrapali Group, said.
The consistent efforts of the RBI have already stabilised rupee against dollar, besides providing short term liquidity support to push growth simultaneously, he added.
"Experts are already expecting inflation to ease following arrival of winter crop in the wake of normal monsoon. Though the real estate developers' community will have to wait little longer to see interest rates dipping, but given the right intentions of the RBI, we are confident of flawless run of growth thereafter," Sharma said.
SARE Homes Executive Director David Walker welcomed the RBI's step and hoped that the incoming data in the next months would support a moderation in the rate of inflation which could then lead to lower interest rates.
Commenting on the credit policy, CREDAI National President Lalit Kumar Jain said the RBI's status quo on policy rates will have a positive effect on the realty sector by bringing in more stability on home loan interest rates.
"We welcome RBI's decision not to hike the Repo and CRR rates and to keep it unchanged as this will stabilise the home loan market and sustain growth in the sector. RBI should take steps to increase fund supply for the sector which will help increase housing stock and stabilise property prices," he added.
CREDAI is the apex body of realtors with over 10,000 members from across the country.
Ashiana Housing MD Vishal Gupta termed it as a big relief in the current economic scenario, especially for housing sector. "There will be no impact on EMIs and more people will able to affirm their decision to buy a house.
Brys Group CMD Rahul Gaur welcomed the RBI decision to keep the rates unchanged. "I think this monetary policy review indicated the policy makers' keenness to understand the perils of the industry and the consumers."
Griha Pravesh Buildteck Pvt Ltd CMD Abhay Kumar said: "It is an astute decision by the bank and will give out a positive signal to the market. This will help the realty sector build on the reviving sentiment."
Kumar hoped that when the economy returns to high-growth path, the RBI would definitely announce some rate cuts.
Property consultant Knight Frank India Chief Economist and Director-Research Samantak Das said: "Looking beyond the inflation fuelled economic vagaries, the central bank has chosen to salvage the weak economic situation."
The status quo on key policy rates would serve as a breather for households and leveraged developers alike, Das added.