Home buyers to return back

New house?Home buyers could arrive back in the Indian real estate market in force after the Reserve Bank of India reduced rates and the cash-reserve ratio requirement. The bank slashed the repo rate by 100 basis points to 5.5% and the reverse repo rate to 4%. Officials also lowered the cash reserve ratio by 50 basis points to 5%, effective from January 17.
Real estate companies are now hoping the move will finally start to see credit moving again after a clampdown on lending saw sales slump.
Mr. Rohtas Goel, M.D., Omaxe, said, “We are confident that banks will reduce interest rates for the housing sector, which will help bring back the end-user to the market.”
Financial analysts are now waiting to see how many of India’s banks pass the cuts on in full.
Confidence in the market had already been boosted in December after officials revealed the government was working on a second stimulus package for the Indian economy.
Many experts believe that home loan rates will drop down to around 8% – the level expected to tempt buyers in huge numbers.