RBI’s hat-trick of Rate Cut to boost homebuyer sentiment

New Delhi, June 06, 2025 :In a move that is likely to bring cheer to homebuyers, the Reserve Bank of India (RBI) has announced a 50 basis point cut in the repo rate, bringing it down to 5.50 per cent. This marks the third consecutive rate cut under Governor Sanjay Malhotra, signaling continued efforts to stimulate economic growth amid global headwinds. While the monetary policy stance has now shifted from ‘accommodative’ to ‘neutral’, the reduction in borrowing costs is expected to support housing demand and improve credit flow to the real estate sector, particularly at a time when affordability and buyer sentiment remain crucial for sustained momentum.

Industry leaders have welcomed the RBI’s decision, highlighting its potential to enhance affordability, uplift buyer confidence, and support long-term growth in the housing sector.

Mr. Prashant Sharma, President, NAREDCO Maharashtra
“The RBI’s decision to implement a third consecutive rate cut and revise its stance to ‘neutral’ reflects a proactive approach to support economic momentum amidst global uncertainties. A 50 bps reduction in the repo rate will help in bringing down home loan interest rates further, which is a welcome move for homebuyers and the real estate industry. Lower inflation expectations and a stable GDP outlook will give confidence to developers and investors alike. We believe this move will play a crucial role in reviving housing demand and sustaining growth in the sector.”

Mr. Nishant Deshmukh, Founder and Managing Partner, Sugee Group
“We are pleased with the RBI’s decision to cut the repo rate by 50 basis points, marking a hat-trick of rate reductions in 2025. This move is both timely and well-calibrated, especially in light of ongoing global economic headwinds. Lower interest rates, along with the revised inflation outlook, offer significant support to real estate buyers — particularly in metropolitan cities like Mumbai, where financial accessibility greatly influences decision-making. The RBI’s continued ‘neutral’ stance signals its commitment to maintaining flexibility in supporting macroeconomic stability, which is a reassuring indicator for long-term investors.”

Mr. Samyak Jain, Director, Siddha Group
“The RBI’s bold move to cut the repo rate by 50 bps while shifting the policy stance to ‘neutral’ comes as a booster shot for sectors like real estate that are sensitive to interest rate movements. This will significantly improve consumer sentiment and reduce the cost of borrowing, thereby accelerating housing demand, especially in mid-income and affordable segments. We appreciate the RBI’s continued efforts to balance inflation control with the need to maintain economic momentum amidst global uncertainties.”

Ms. Shraddha Kedia-Agarwal, Director, Transcon Developers
“The RBI’s third straight rate cut, along with a shift to a ‘neutral’ stance, reflects its agility in navigating the evolving global and domestic macroeconomic landscape. With the repo rate now at 5.50%, we foresee an uptick in home buying activity driven by improved affordability. The revision in inflation projections to 3.7% is also encouraging and gives confidence in the RBI’s forward-looking policy framework. Such measures are crucial in reinforcing consumer trust and sustaining growth in India’s housing market, particularly in cities like Mumbai.”

Corporate Comm India (CCI Newswire)