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Quote on RBI Monetary Policy By Mr. Sriram Mahadevan, Managing Director, Joyville Shapoorji Housing Private Limited

"The RBI has acknowledged that the inflation forecast for the country is unchanged at 6.7%. It now sees inflation for Q2 at 7.1%, Q3 at 6.4%, and Q4 at 5.8%, which is a marginal decrease. Its decision to hike the interest rate again by 50 basis points was expected to combat inflationary growth in the country. While an increase in home loan rates is likely to have an impact on the sector, we believe the home loan rates even now are at very reasonable levels of 6.65% onwards. This kind of home loan rates were there few years back. Thus, this is the right time for all those who are considering buying a home to actually move forward and grab the prevailing opportunities. In India, real estate has long been the preferred asset, and since the pandemic, we see home ownership driving demand. Also, with the festive season around the corner, we anticipate that consumer demand will remain buoyant, with demand increasing across segments, from affordable to mid-size to luxury housing.

The central bank highlighted that while inflation might be moderate in the coming months, indecisiveness around these pressures continues to remain high, necessitating the need for a 50-bp rate hike. The monetary policy committee has decided to retain its real GDP growth projections despite hiking rates by 50 bps. Until now, the commercial banks have transmitted the policy rate hike to the borrowers, resulting in an increase in lending rates across all sectors, including real estate."

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