Industry Context and Market Dynamics
The real estate industry has welcomed the RBI’s rate cut as a timely boost to affordability and demand. With home prices having risen steadily across major markets, even a marginal reduction in interest rates meaningfully strengthens purchasing power, especially for first-time and mid-income buyers.
Ashish Jerath, President – Sales & Marketing, Smartworld Developers, observes:
“The RBI’s 25-basis-point cut, bringing the repo rate down to 5.25%, is a timely boost for the real estate sector. Lower interest rates reduce borrowing costs, enabling homebuyers to retain more disposable income while strengthening their purchasing power and confidence. With EMIs becoming more manageable, many fence-sitters are likely to re-enter the market, adding momentum to transactions. For young professionals, first-time buyers, and aspirational end-users, this rate reduction makes homeownership more attainable and helps advance their purchasing plans. We believe this twin advantage of lower interest rates and a positive economic outlook will enhance buyer affordability and buying confidence, resulting in higher offtake in the residential segment. Combined with the upward revision of GDP growth to 7.3%, the policy environment now appears strongly supportive of a healthier and more broad-based housing cycle in the coming quarters.”
RBI and Policy Implications
The monetary policy move reinforces confidence in India’s economic trajectory. Many leaders note the alignment between easing inflation, supportive growth indicators and the RBI’s decision.
Mr Sam Chopra, President & Country Head, eXp Realty India, states:
"The RBI’s 25 basis-point rate cut to 5.25% comes at a pivotal moment for homebuyers who have been balancing aspiration with affordability in a supply-constrained market. After two pauses and a cumulative 100 bps easing since February, this move reinforces confidence in India’s disinflation trajectory and resilient growth outlook. With headline CPI firmly trending below 4%, core inflation easing, and GDP expanding at 8.2% in Q2, the policy environment now clearly supports long-term housing decisions."
Insights from Reports and Economic Indicators
The cut is seen as strengthening liquidity and supporting project feasibility. Developers also highlight that it complements GST rationalisation, helping stabilise pricing conditions.
Parthh K. Mehta, CMD – Paradigm Realty, notes:
“For end-users, the reduction in borrowing costs improves EMI feasibility, while for investors, it sharpens yields in both residential and rental-focused micro-markets. Developers, too, gain clarity on funding costs and project planning. The cut also complements recent GST rationalisation on construction materials, together offering a more supportive pricing outlook for 2026.
Most importantly, it sets the stage for structured, transaction-ready momentum across metros and emerging submarkets — from mid-income housing to premium lifestyle-led projects. For brokers and agents, this creates a window of opportunity to guide buyers with better transparency, more realistic affordability scenarios, and long-term confidence in the property cycle."
Stakeholder Perspectives
Across the real estate sector, leaders expect the cut to accelerate decision-making, particularly in the mid-income and aspirational categories, while supporting liquidity and project execution timelines.
From Shapoorji Pallonji Real Estate:
"The RBI’s announcement is aligned with our expectations of a 25-basis-point cut, which will close out this year on a high note – historically, such reductions have prompted a surge in demand, caused by increased buyer confidence. By lowering the cost of borrowing, home loan EMIs become more affordable, which has direct consequences on purchase decisions. From the developers’ standpoint, the repo rate reduction will enable them to access more capital for their projects, which can positively impact project completion timelines. With inflation softening significantly, liquidity conditions stabilising and economic activity remaining robust, the MPC has an incredible opportunity to shift toward a more growth-supportive stance. By easing financing costs, this move will stimulate consumption and strengthen investment sentiment as the economy enters a high-demand cycle."
From SPRE:
“We welcome the Reserve Bank of India’s decision to reduce the policy repo rate by 25 basis points to 5.25 percent. This calibrated move supports growth, anchors inflation expectations, and strengthens market confidence. For the housing sector, especially mid income and aspiring buyers, lower borrowing costs enhance affordability and uplift sentiment. With the benefits of rate cuts being passed on, it will significantly accelerate decision making in the mid income segment, while the premium category benefits more through an uplift in overall market confidence and improved investment sentiment. We believe the RBI’s move is closely aligned with evolving homebuyer needs and will help catalyse demand in the coming months.”
Aayush Madhusudan Agrawal, Founder & Director, Inspira Realty:
“The Reserve Bank of India’s decision to reduce the repo rate by 25 basis points, bringing it to 5.25% which helps us to arrive at an opportune moment for the housing market and for Inspira Realty. The improved interest-rate environment is likely to boost buyer confidence and trigger increased enquiries, particularly among first-time buyers and mid-income home-seekers. We believe this will accelerate demand… stable demand ahead.”
Mr Harsh Jagwani, Managing Director, Notandas Realty:
"The RBI's move to reduce the repo rate to 5.25% comes as a much-needed relief and boost to the economy… we believe it will continue in the next year as well."
Ms Binitha Dalal, Founder and Managing Partner, Mt. K Kapital:
“The RBI’s rate cut is a welcome move that comes at a crucial time for the economy… supporting the long-term health of the economy.”
Ms Amrita Gupta, Director, Manglam Group:
"The RBI’s decision to cut policy rates will significantly support housing demand in Tier 2 and Tier 3 cities… and encourages investment in new residential supply.”
Mr Aditya Kushwaha, CEO and Director, Axis Ecorp:
“The RBI’s 25 bps rate cut comes at a very favourable moment for the real estate sector… long-term value creation.”
Bhavesh Kothari, Founder & CEO, Property First:
"The RBI's move to cut the repo rate to 5.25% is a positive signal for the market… which will rise to the occasion."
Navin Dhanuka, Director, ArisUnitern RE Solutions Pvt Ltd:
“The RBI’s 25 bps rate cut — taking the total reduction this year to 125 bps — comes at a crucial moment… supporting broader growth across the real-estate sector”
Manan Joshi, Co-Founder, Sarvam Properties:
“With the Reserve Bank of India cutting the repo rate to 5.25 per cent… giving a welcome lift to the real estate market”
Mahendra Nagaraj, Vice President, M5 Mahendra Group:
“The Reserve Bank of India’s decision to reduce the repo rate to 5.25% is a timely move… real estate sector as a key drive of India’s economy.”
Anuj Puri, Chairman – ANAROCK Group:
“The RBI’s decision to cut the repo rate by 25 bps is a distinct positive for the Indian real estate sector as we close 2025… bring at least some fence-sitters to the market."
Mr Jash Panchamia, Executive Director, Jaypee Infratech Limited:
"The RBI’s decision to cut the repo rate by 25 basis points comes at an opportune moment… fostering long-term confidence in the real estate ecosystem."
Mr Khiroda Jena, Chief Financial & Risk Officer – Bombay Dyeing (Bombay Realty):
“RBI’s 25 bps rate cut is a well-calibrated move that delivers immediate relief… real estate sector.”
Broader Industry Impact
Collectively, the sector expects stronger demand, deeper market participation and more predictable capital flows. Developers anticipate quicker absorption of inventory and smoother project execution. Buyers are likely to benefit from improved affordability and clearer decision-making conditions.
