Is Now the Right Time to Buy a New House? Real Estate Experts Weigh In
The Reserve Bank of India's (RBI) 100 basis points repo rate cut is expected to make home loans more affordable, reviving interest in the mid-income and premium housing segments. Experts weigh in on the impact of this decision on the real estate market.
Real EstateHome LoansRepo RateHousing MarketFirsttime BuyersReal Estate NewsJun 06, 2025
In the last four months, the RBI has reduced the repo rate by a total of 100 basis points, which is expected to lower home loan rates. This reduction is particularly beneficial for first-time homebuyers, who are already showing increased interest in the market following previous rate cuts.
Manju Yagnik, Vice Chairperson of Nahar Group and Senior VP of NAREDCO, Maharashtra, commented, “The RBI’s decision to reduce the repo rate by 50 basis points is a strong and timely intervention, especially amid early signs of demand moderation in the residential sector.” Yagnik added, “This rate cut is poised to create a significant improvement in affordability, especially for first-time purchases. This will help revive interest in mid-income and premium housing segments.”
Aman Sarin, Director and Chief Executive Officer of Anant Raj Limited, echoed similar sentiments, stating, “We believe this will have a positive impact on the real estate sector, particularly the mid- and high-end segments, as interest rates become more affordable with reduced EMI and improved loan eligibility.”
Pradeep Aggarwal, founder and chairman of Signature Global (India), noted that the demand for mid and premium segment homes has already been on the rise following previous rate cuts. “This larger reduction will further accelerate interest from both homebuyers and investors,” he said. Aggarwal also highlighted the positive market sentiment surrounding the possibility of further rate cuts this financial year, which bodes well for the real estate sector.
One of the most significant impacts of the repo rate cut will be on home loan interest rates. Real estate experts are optimistic that this reduction will lead to lower home loan interest rates. “Lowering the repo rate to 5.5% will have a cascading effect across the lending ecosystem, bringing home loan interest rates well below 7.75%—a highly encouraging development for both existing and prospective homebuyers,” said Yagnik.
For developers, cheaper credit will ease liquidity constraints, accelerate project implementation, and improve delivery timelines. This will provide much-needed cash flow to absorb unsold inventory while generating fresh buyer interest, benefiting the real estate value chain as a whole.
Sarin emphasized that for both existing and new borrowers, the cumulative 100 basis point reduction will provide significant relief in terms of reduced interest burden. Anshuman Magazine, Chairman and CEO of CBRE for India, South-East Asia, Middle East, and Africa, added, “This reduction is expected to lead to lower borrowing costs, increased liquidity, and enhanced consumer spending power. For the real estate sector, this move is particularly beneficial as it will make home loans more affordable, stimulating demand and driving growth. The reduced interest rates will also encourage developers to take on new projects, boosting construction activity and creating employment opportunities.”
Jash Panchamia, Executive Director at Jaypee Infratech Limited, pointed out that the RBI’s decision to slash the repo rate by 50 basis points and the Cash Reserve Ratio (CRR) by 100 basis points is aimed at fueling consumption and accelerating investment. “With several scheduled commercial banks already offering home loans below 8 percent, today’s decision may lead to a broader transmission of lower rates across the lending ecosystem. This will not only ease the financial burden on borrowers but also enhance affordability across housing segments, offering significant relief to homebuyers and providing a timely push for those planning property purchases,” he added.
Overall, the RBI’s repo rate cut is expected to have a positive and far-reaching impact on the real estate market, making it an opportune time for potential homebuyers to consider their options.
Frequently Asked Questions
How will the repo rate cut affect home loan interest rates?
The repo rate cut is expected to lower home loan interest rates, making them more affordable for both existing and new borrowers. This will reduce the financial burden on homebuyers and enhance their loan eligibility.
Who will benefit the most from the repo rate cut?
First-time homebuyers and those in the mid-income and premium housing segments will benefit the most from the repo rate cut, as it will improve affordability and stimulate interest in the market.
What is the impact of the repo rate cut on developers?
Developers will benefit from cheaper credit, which will ease liquidity constraints, accelerate project implementation, and improve delivery timelines. This will help absorb unsold inventory and generate fresh buyer interest.
How will the repo rate cut affect the overall real estate market?
The repo rate cut is expected to have a positive impact on the real estate market by making home loans more affordable, stimulating demand, and driving growth. It will also encourage developers to take on new projects and boost construction activity.
Are there any indications of further rate cuts in the future?
There is a positive market sentiment around the possibility of further rate cuts this financial year, which could provide sustained growth and renewed confidence in the housing market.
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