RBI's Repo Rate Cut to 5.25% Spurs Optimism Across India’s Real Estate Sector

The RBI’s 25 basis-point repo rate cut has emerged as a significant booster for the real estate sector, setting the stage for heightened activity across residential and commercial markets. With inflation stabilising and economic growth strengthening, the reduced interest rate regime is expected to meaningfully enhance homebuyer affordability, ease borrowing costs for developers, and improve overall market liquidity.

Industry leaders believe this policy move will accelerate homebuying—especially in mid-income, premium, and luxury segments—while also strengthening the viability of commercial expansions and new investments.

Prashant Sharma, President, NAREDCO Maharashtra
“The RBI’s decision to reduce the repo rate by 25 basis points comes at a perfect time for the industry and reinforces India’s Goldilocks moment of low inflation and strong growth. A lower interest rate regime will provide much-needed momentum to housing demand, especially in the mid-income and premium categories where sentiment has remained strong. With inflation stabilising and GDP growth accelerating, this policy move will not only improve homebuyer affordability but also support developers by reducing overall borrowing costs. We expect the rate cut to trigger improved sales velocity across key markets in Maharashtra.”

Kaushal Agarwal, Chairman, The Guardians Real Estate Advisory
“The RBI’s calibrated 25 bps rate cut is a welcome breather for the real estate sector at a time when the rupee’s volatility and global headwinds were beginning to cast uncertainty. Home loan EMIs are likely to see marginal improvement, which will further strengthen buyer confidence—particularly among fence-sitters waiting for a softer interest rate environment. With demand already buoyant and inflation at near-zero levels, this decision will lend additional stability and stimulate fresh investment into both residential and commercial real estate.”

Shilpin Tater, Managing Director, Superb Realty
“The RBI’s 25 basis-point repo rate cut will positively impact both residential and commercial real estate. On the residential front, lower borrowing costs will enhance affordability and accelerate purchases, especially among first-time and young homebuyers. For the commercial segment, a softer rate environment improves capex viability, boosts investor sentiment, and encourages businesses to expand or upgrade office spaces. With GDP growth robust and inflation at record lows, this rate cut positions the sector for a strong growth cycle across both asset classes in FY2026.”

Shraddha Kedia-Agarwal, Director, Transcon Developers
“A 25 basis-point rate reduction, combined with a neutral stance, reflects the RBI’s confidence in India’s economic fundamentals. For end-users, especially in metropolitan markets like Mumbai, even a small EMI correction significantly impacts affordability. We expect this rate cut to boost sales in the luxury and upper-mid segments, where consumer sentiment is already positive due to rising disposable incomes and aspirational living. This policy move will give homebuyers the comfort and confidence to upgrade and invest.”

Dhruman Shah, Promoter, Ariha Group
“The RBI has delivered a timely and positive move by reducing the repo rate, which will directly strengthen market sentiment and fuel homebuying activity. With inflation at historic lows and the economy demonstrating strong momentum, today’s decision provides both consumers and developers with greater financial flexibility. We expect this to translate into stronger demand and improved liquidity across the real estate value chain.”