RBI's rate cut will help if banks pass on benefit to end-users, say realty players

The real estate industry on Wednesday said the MPC's decision to cut the repo rate would help the sector if banks pass on the benefit to end-users in the form of lower lending rates.

The Reserve Bank of India's (RBI) Monetary Policy Committee on Wednesday cut the interest rate by 35 basis points (bps) -- the fourth successive reduction -- to a nine-year-low level, in an attempt to boost an economy growing at its slowest pace in nearly five years.

The repo rate is the rate at which the RBI lends to banks.

CREDAI Haryana spokesperson Prashant Solomon said the reduction of the repo rate by 35 bps was on the expected lines. CREDAI is the apex association of real estate developers.

"Given that there was no rate cut after the Union Budget, this move was highly anticipated," he said.

Solomon added that the fall in interest rates would be of great benefit to the real estate sector. "Now, we expect that the benefits of reduced rates are transmitted to the end-users by banks at the earliest."