RBI is set to raise repo rates once more. Following a 40 basis point hike in May, the RBI increased the interest rate twice more for a total of 140 basis points, bringing the benchmark repo rate to 5.40 percent.
Subhash Goel, MD, Goel Ganga Developments, added on the increased cost of borrowing by stating, “The surge in consumer demand and their ability to afford will continue to be positive. Snugly interest rates may disturb the sales momentum, with the real estate market recovering moderately.”
Following the RBI’s pronouncement, numerous banks started hiking interest rates on lending and deposit programs. The RBI’s rate increase will also impact residential sales growth. In reaction to the continued surge in raw material costs, builders throughout the country have already hiked real estate prices.
Source: RBI policy: How a repo rate hike can affect your finances
