RBI rate hikes, higher costs fail to deter home buyers

Sales of residential properties continue to witness month-on-month growth despite the recent surge in property prices due to the increase in cost of raw materials and the Reserve Bank of India increasing the repo rate twice during the quarter, according to leading real estate developers and brokerage firms. According to an Economic Times report, experts said that following the outbreak of the Covid-19 pandemic, the perception of real estate investing changed. “Despite the increase in repo rate, affordability is at an all-time high. The real estate industry was in a downturn for a long time but now the cycle has turned. We believe the positive sentiment will continue,” Mohit Malhotra, managing director and CEO Godrej Properties Ltd, told the newspaper. According to Motilal Oswal Financial Services Ltd, despite a sharp recovery in demand in the past two years, prices have remained broadly flat this time, thereby limiting the impact on affordability. “We continue to witness month-on-month increase in sales volume,” said Sanjay Dutt, managing director and CEO, Tata Realty & Infrastructure Ltd. The setting up of the Real Estate Regulatory Authority (RERA) has also improved builder-buyer sentiment, which is now on the positive side, as well as easing the overall loan process and buying journey.Also Read: PNB Housing Finance: Housing sector to grow in 5 years Delhi-NCR housing market sales fall 19% in Apr-Jun