The Reserve Bank of India’s Monetary
Policy Committee (MPC) has taken a decisive step to revive economic momentum by
slashing the repo rate by 50 basis points, bringing it down to 5.5%, while also
reducing the Cash Reserve Ratio (CRR) by 100 bps. These moves, combined with a
revised CPI inflation outlook of 3.7% and a projected real GDP growth of 6.5%
for FY26, reflect a front-loaded approach to accelerate growth and consumer
confidence.
Responding
to the announcement, CREDAI-MCHI, the apex body of real estate developers in
the Mumbai Metropolitan Region, Gera Developments and Star Housing Finance
Limited welcomed the RBI’s bold and growth-oriented stance, highlighting its
strong potential to unlock housing demand, especially in the affordable and
mid-income segments.
Mr. Domnic Romell,
President, CREDAI-MCHI said:
"This
dual action of reducing both the repo rate and CRR sends a clear
signal—liquidity infusion and affordability are a priority. Lower interest
rates on home loans will make homeownership more accessible to thousands of
first-time buyers across MMR and beyond. This move can energize end-user
sentiment, improve project viability, and bring housing within reach for
many."
Mr. Dhaval Ajmera,
Secretary, CREDAI-MCHI added:
"We
urge banks and lending institutions to swiftly transmit the benefit of the rate
cut to consumers. The current economic environment—low inflation, improved
liquidity, and steady demand—creates a strong foundation for a real estate-led
recovery. This is the ideal time for aspiring homebuyers to take the
leap."
CREDAI-MCHI
also emphasized that the CRR cut will support NBFCs and banks in extending more
credit to developers, particularly those operating in emerging growth corridors
of MMR such as Panvel, Dombivli, Vasai-Virar, and Kalyan, where affordable
housing remains the driving force.
The
organization reaffirmed its commitment to working collaboratively with
stakeholders to ensure the benefits of this monetary easing are passed on
efficiently and transparently, accelerating India’s journey toward inclusive
housing and sustainable urban growth.
Mr. Rohit Gera, Managing Director Gera
Developments, highlighted
"The
RBI’s decision today to cut the repo rate for the third time in a row comes as
no surprise, given the strong macro indicators retail inflation easing to 3%
levels, solid GDP momentum with a 6.5% growth target, and ample durable
liquidity already pumped into the system. This cumulative 100 bps repo rate
reduction in 2025 is now complemented by a sharp 100 bps cut in the CRR from 4%
to 3% which alone injects significant liquidity and lowers banks' cost of
funds. Together, these measures are designed to accelerate monetary policy
transmission and bring down lending rates across the board. This reflects the
central bank's aim to bolster domestic economic growth and shared prosperity
amid global uncertainties. For the real estate sector, this move could be a
catalyst: lower borrowing costs will translate into reduced EMIs and improved
homebuyer sentiment. Hopefully, banks actively and rapidly pass on the
cut to home buyers. The policy stance clearly aims to revive private investment
and consumption."
Mr. Kalpesh
Dave, Director & CEO, Star Housing Finance Limited mentioned:
“The
RBI's decision to reduce the repo rate by 50 basis points is a welcome move.
This should translate into lower EMIs for home loan borrowers. Disposable
income should increase and thereby scope for increased spending. Concurrently,
it lowers the borrowing costs for HFCs and NBFCs. We anticipate a thrust in
retail credit off-take, particularly in home financing, as affordability
improves. This is a positive step that should stimulate consumer spending and
boost the housing sector. While celebrating this growth impetus, we acknowledge
that vigilant inflation monitoring remains crucial going forward to sustain
these benefits.”