The Government should keep a continuous check in the form of reforms that will give a fillip to the real estate sector and will indirectly help revive the economy, Ashok Mohanani, president, NAREDCO - Maharashtra, said.
MUMBAI, Feb 5 (The CONNECT) Commenting on the RBI monetary policy, Ashok Mohanani, President - NAREDCO Maharashtra, said the economic growth needs to be supported through the monetary policy and this is the foremost reason that the RBI has continued its accommodative stance. It has focused on balancing liquidity in the financial system while keeping inflation within its target. The interest rates will continue to be at a record low, however the banks should pass on the benefits to the customers which will boost real estate demand.
Like the last quarter, we expect the demand to be robust in the Mumbai MMR region in this quarter. The state government's recent announcement of reduction on premiums for developers along with stamp duty reduction for buyers will have a cascading impact on project sales, which will provide an immediate boost to the ailing sector. In the recently concluded Union Budget, too, the Central Government has focused and put a step in the right direction to revive the economy after the repercussion of the Covid-19 impact, Mohanani said.
The government has sustained its thrust on affordable housing which will further help achieve the Prime Minister's vision of Housing for All. The real estate sector in India is expected to reach US$ 1 trillion by 2030 and it will contribute 13% to the country's GDP by 2025. The Government should keep a continuous check in the form of reforms that will give a fillip to the real estate sector and will indirectly help revive the economy, he said.
Kaushal Agarwal - Chairman, The Guardians Real Estate Advisory, said "After a budget that had limited announcements for real estate, the sector was hoping against hope for a further reduction in the repo rates. The reduction would have helped spurred growth in demand for real estate assets, that has been severely hit as a result of the pandemic and subsequent lockdowns.”
Currently apart from the reduction in stamp duty charges in some parts of the country, the all-time low housing loan rates have given the much required fillip to sales activity in the last quarter. The reduced repo has the potential to boost consumption in the economy and help reduce dependence on government spending, Agarwal said.
Himanshu Jain, VP - Sales, Marketing & CRM, Satellite Developers Private Limited (SDPL) said, "On an expected line, the monetary policy committee (MPC) has kept the repo rate unchanged at 4% with an extended accommodative stance that will still continue to serve the markets well. Some strong liquidity measures were announced and are expected to continue which was one of the worries of the market before policy.
The earlier announcements by the state government of stamp duty reduction along with reduction on premiums for developers will surely give a boost to the ailing sector and create demand among the homebuyers. The Union Budget 2021-22 also has provided a strong impetus in favour of the Affordable Housing segment. With the interest rates at a record low, the Government will continue taking affirmative measures as long as it is necessary to revive the economy and mitigate Covid-19 impact."
Harsh Kumar Bhanwala, Executive Chairman, Capital India Finance Limited (CIFL) said, "With this accommodative stance, the RBI is expecting normalization of sectors as the CRR will further open up space for a variety of market operations and make lending easier. The RBI extending Targeted Long Term Repo Operations (TLTRO) to NBFCs will further enhance credit flow and potential for the affordable housing sector, SMEs, infrastructure projects etc. Since the resident individuals can now make remittances to IFSCs for NRIs, it will increase the flow of remittances from foreign countries."
Bhushan Nemlekar, Director, Sumit Woods Limited, said RBI continues to maintain an accommodative stance while focusing on economic revival and to allow elbow room for further policy interventions if required. Through the proactive measures, RBI has taken honest efforts to provide access to easier credit to smaller businesses. Also, the focus of the Union Budget 2021 was on overall economic development and one segment that stood out was affordable housing, which will benefit from the tax holidays provided for an additional year. RBI's stance is a step in the right direction and is expected to provide a fillip to housing loans, thus having a positive impact on the residential sector.