Mumbai, June 6, 2025:The Reserve Bank of India’s recent decision to reduce the repo rate by a cumulative 50 basis points has been warmly welcomed by real estate stakeholders, particularly in the Mumbai Metropolitan Region (MMR). The move is widely seen as a critical boost for housing demand—especially in the affordable segment—at a time when inflationary pressures and rising input costs have impacted buyer sentiment.
CREDAI-MCHI, the apex body for real estate developers in MMR, lauded the central bank’s accommodative stance. Domnic Romell, President of CREDAI-MCHI and Director at Romell Group, called the cut “a significant financial relief” for aspiring homeowners.
“A cumulative rate cut of 50 basis points significantly eases the monthly repayment burden, especially for cost-sensitive buyers in the affordable housing segment. A home loan of Rs 15–20 lakh now translates to an EMI reduction of Rs 700–1,000. This not only lifts market confidence but also activates fence-sitters and rekindles first-time buyer interest in urban and semi-urban areas,” Romell explained.
Kalpesh Dave, Director & CEO of Star Housing Finance Limited, echoed these sentiments, stating:
“The RBI’s decision is a welcome move. It should translate into lower EMIs for home loan borrowers and enhance disposable income, thereby increasing spending capacity. Additionally, it reduces borrowing costs for Housing Finance Companies (HFCs) and Non-Banking Financial Companies (NBFCs). We anticipate a thrust in retail credit off-take, particularly in home financing. This is a positive step to stimulate consumer spending and boost the housing sector. That said, vigilant inflation monitoring remains essential to sustain these benefits.”
Industry experts agree that the rate cut will improve home loan eligibility and affordability ratios, expanding the formal housing market. Dhaval Ajmera, Secretary of CREDAI-MCHI and Director at Ajmera Realty, noted:
“The interest rate cut makes homeownership more accessible, especially for economically weaker sections. It will unlock latent demand and broaden the base of eligible borrowers—giving a significant push to affordable housing, which remains the backbone of India’s residential sector.”
With infrastructure upgrades, metro expansions, and growing preference for budget-friendly housing, peripheral regions in the MMR are emerging as key growth zones. Nikunj Sanghvi, Treasurer of CREDAI-MCHI and Managing Director at Veena Developers, emphasised this trend: “Markets like Palghar, Badlapur, and Panvel are poised to benefit the most. With property prices already attractive, lower interest rates will improve inventory turnover and encourage new project launches, driving broader economic activity in these belts.”
The repo rate cut is expected to enhance credit accessibility, encourage new housing investments, and stimulate job creation in sectors allied to real estate—from construction and logistics to consumer durables and retail. As affordability improves and financing becomes more accessible, the sector looks forward to renewed momentum, particularly in segments catering to first-time homebuyers and the middle-income group.
