New Delhi, Aug 8 (IANS) The Central Bank’s decision to keep repo rates unchanged at 6.5 per cent for the ninth consecutive time aligns well with the government’s indexation benefits, industry experts said on Thursday, adding that this will further help aspiring homebuyers.
RBI Governor Shaktikanta Das said that the Monetary Policy Committee (MPC) has decided to keep the repo rate unchanged as inflation has risen above 5 per cent, beyond the targeted level of 4 per cent.
Anuj Puri, Chairman of Anarock Group, said that the RBI’s decision sets a positive tone for the housing industry.
“With interest rates staying steady, EMIs will remain manageable for current and potential homeowners, potentially leading to increased home sales – particularly in the price-sensitive affordable segment,” he said.
The earlier announcement regarding indexation also brings tax advantages for property investors, as it permits adjustments to the purchase price keeping inflation in mind, reducing capital gains tax burdens upon property sale.
According to Madhavi Arora, lead economist at Emkay Global Financial Services, the RBI is likely to be on wait-and-watch mode for assessing multiple macro forces.
“We understand that shifting debates on global narratives require the RBI to be flexible. However, the volatility in India FX and rates has been manageable amid the recent global market turmoil, giving flexibility to the RBI to stay focused on domestic inflation and financial sector risk management,” said Arora.
The RBI Governor said the country’s inflation rate is expected to come down in the third quarter of the current financial year.
According to Vimal Nadar, Senior Director and Head, Research at Colliers India, the RBI has remained cautious and maintained benchmark lending rates at 6.5 per cent.
“In the first MPC meeting after the Budget, the RBI has projected a GDP growth rate of 7.2 per cent for FY2025, led by robust high frequency economic indicators across key sectors,” said Nadar.
Interestingly, stability in interest rates coupled with the recent announcement to rationalise stamp duty charges along with concessions for women homebuyers bodes well for the real estate sector, especially residential segment.
“Moreover, partial withdrawal of the applicability of the revised LTCG tax arising out of sale of land and buildings retrospectively provides elbow room to effect housing sales with minimal tax outgo,” Nadar noted.
Shrinivas Rao, FRICS, CEO, Vestian said that a steady monetary policy for the past one and half years has ensured stability in the real estate sector, boosting demand for all asset classes.
Though India’s position today is far more resilient on the economic front which could have allowed a slight rate reduction to test the water on inflation and exchange rates, the RBI has taken a safer bet and decided to wait for rate reduction by the third or the fourth quarter of this year, said Umeshkumar Mehta, CIO, SAMCO Mutual Fund.
–IANS
na/
Disclaimer
The information contained in this website is for general information purposes only. The information is provided by TodayIndia.news and while we endeavour to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.
In no event will we be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from loss of data or profits arising out of, or in connection with, the use of this website.
Through this website you are able to link to other websites which are not under the control of TodayIndia.news We have no control over the nature, content and availability of those sites. The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.
Every effort is made to keep the website up and running smoothly. However, TodayIndia.news takes no responsibility for, and will not be liable for, the website being temporarily unavailable due to technical issues beyond our control.
For any legal details or query please visit original source link given with news or click on Go to Source.
Our translation service aims to offer the most accurate translation possible and we rarely experience any issues with news post. However, as the translation is carried out by third part tool there is a possibility for error to cause the occasional inaccuracy. We therefore require you to accept this disclaimer before confirming any translation news with us.
If you are not willing to accept this disclaimer then we recommend reading news post in its original language.
