Even as the real estate industry welcomed RBI’s decision to cut repo rates by 35 basis points, experts feel the growth of the sector will depend on proportional transmission of rate cuts to the end-consumer. The apex bank on Wednesday cut interest rate by a rare 35 bps, the fourth successive reduction, to a nine-year low, in an attempt to boost an economy growing at its slowest pace in nearly five years.
“It’s a good initiative. Will bring in more liquidity. But for proper effect, banks need to pass on the benefit to the end-user,” CREDAI President Satish Magar told PTI on the sidelines of NATCON conference in Tel Aviv.
CREDAI chairman Jaxay Shah, however, said that the real estate industry is still waiting for one-time restructuring of loans which will enable developers to complete stalled projects. NAREDCO National President Niranjan Hiranandani said the fourth straight cut in the benchmark repo rate will make borrowings cheaper and would help boost in demand in several sectors like real estate and auto, which have been sagging since the last several quarters.