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Below the Views on RBI Policy Impact on Housing Loans by Kanika Singh, Chief Risk Officer– IMGC

“The RBI kept the repo rate unchanged due to inflationary pressures. Despite the GDP growth rate for Q2 FY25 being significantly lower than expected, the RBI is unlikely to shift its stance to accommodate growth. High-frequency indicators show early signs of recovery in the second half of the fiscal year, but inflation risks remain elevated. Affordability has become challenging as loans remain expensive and property prices have steadily increased. Residential real estate sales have moderated, with high-end, mid-end, and affordable segments largely flat over the last quarter. Factors such as high capital values, inflation pressures, and uncertainty around the RBI's repo rate cut may lead some homebuyers, especially in metros, to adopt a wait-and-watch approach. Meanwhile, Tier 2 and 3 cities continue to drive growth in housing loans.”

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