NAREDCO Advocates for Repo Rate Reduction to Boost Housing Demand

NAREDCO calls for a 25-30 basis points cut in repo rates to energize the real estate sector, benefiting related industries like construction. A lower rate could enhance liquidity, making home loans more affordable and encouraging investments, particularly in affordable housing in tier-2 and 3 cities.

NAREDCO, the realty sector body, is urging for a 25-30 basis points reduction in repo rates as the Reserve Bank of India (RBI) deliberates on its upcoming monetary policy. Such a move, according to NAREDCO, would not only invigorate the real estate market but also benefit allied industries, including construction, cement, and steel.

The proposed rate cut is expected to make home loans more affordable, offering a psychological and financial boost to developers and buyers. It would also enhance liquidity, enabling developers to expedite ongoing projects and plan new ventures, which aligns with the government's vision of inclusive growth and urban development.

Supporters of the rate cut, including Knight Frank and BCD Group, highlight that the move would be particularly beneficial for affordable housing segments in smaller cities. It would also help reinstate consumer sentiment, especially amongst lower and mid-income buyers, and potentially ease the borrowing process for developers.