“The past few years have not been kind towards the residential real estate sector, as it continues to struggle under the grip of severe liquidity crisis, unsold inventory and unfinished projects. The slew of government initiatives in 2019 like setting up of Rs.25,000 Cr stress fund and consecutive repo rate cuts gave us the optimism that the sector will gain some momentum in 2020. However, these are extraordinary times where entire world economies have come to a standstill due to the Covid-19 outbreak. While everyone is bearing the brunt of this pandemic, it is the middle class and those who make minimum wage that have been worst hit.
Our government has taken some remarkable measures to curb this menace; the announcement of Rs 1.7 lakh crore relief package to help those hit the hardest by the Covid-19 lockdown is commendable. We also applaud RBI’s bold move of relaxing the repo rate by 75 basis points to 4.4%, as this will lead to reduction in home loan rates/ equated monthly instalments (EMIs) of borrowers, thereby taking some financial burden off them. These efforts are also bound to make the residential real estate sector more attractive for new home buyers as it will be cheaper to take new loans.
We are glad to see that the government and RBI are working together to combat the slowing GDP growth and inflation and help the real estate sector as it forms the backbone of several other sectors. These new announcements will also help lift the homebuyer sentiment, kick-starting the demand cycle for mid-range homes as well as affordable housing. With the stock market witnessing a lot of fluctuations in these times of uncertainty, we anticipate that a lot of people will consider investing in property as that is a more stable, long-term asset.”
