Monetary policy does not meet real estate sector expectations

The mid-quarter plicy may not give thrust to demand for affordable housing

Expressing disappointment over the RBI’s decision to cut repo rate by “just” 25 basis points, realtors’ apex body CREDAI has said that the central bank appears to missing opportunities time and again.

“It is high time that we looked at enhancing growth by infusing liquidity and going in for rate cut,” said Lalit Kumar Jain, National President of CREDAI.

CREDAI (the Confederation of Real Estate Developers’ Associations of India) has over 10,000 members across 20 cities pan-India.

Expressing his concern for inflation vs growth, he said that Inflation could well be curbed by giving a big boost to production and flooding market with supplies. It is not a prudent policy to risk anarchy through a tight monetary policy.

The developer community, according to Jain, was hopeful that the RBI too will soften its stand and help the sector revive. But the continued stubborn approach of RBI is shocking, he added.

Jain said the mid-quarter monetary policy is by and large uneventful since it does not take into consideration of the real estate sector that contributes handsomely to the GDP.

“One would have expected RBI to be realistic and appreciate the fact the real estate industry supports hundreds of other industries and hence plays a major role in rejuvenating the economy hit by job losses and dwindling investments,” he said.

RBI should take steps to ease funding for real estate at much lower rates of interest in the interest of millions of home seekers and ease CRR as well, he said.

“We cannot hope to make housing affordable for the masses with such restrictive policies,”  Jain added.