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RBI Repo Rate Cut Boosts Buyer Affordability: Marathon Nextgen Realty’s Mayur R. Shah

Industry Perspective on RBI’s Repo Rate Cut

The real estate sector has welcomed the Reserve Bank of India’s decision to reduce the repo rate to 5.25%, noting its impact on affordability, buyer confidence, and demand momentum.

Mr. Mayur R. Shah, Vice-Chairman of Marathon Nextgen Realty Ltd and Former President of CREDAI-MCHI, said:

“The RBI’s decision to reduce the repo rate to 5.25% is a much-welcome decision. A significant portion of our homebuyers in Bhandup, Dombivli and Panvel hail from mid-income families and are first-time homeowners. For them, even a modest 0.25% cut in interest rates is the shift from simply looking to purchase to being committed to a purchase.

For instance, on a typical Rs 1 crore home loan over 20 years, a 0.25% reduction brings the monthly EMI down by roughly Rs 1,600, amounting to almost Rs 4 lakh in savings over the full tenure. This also improves loan eligibility, where a buyer previously qualifying for a Rs 1 crore loan could now be eligible for around Rs 1.8 lakh more.

For many, particularly in the sub Rs 1 crore market, this can be a decisive difference—a difference that allows homebuyers to choose the home they truly want rather than settling for less. Today’s rate cut by the RBI MPC is also a strong indicator of macroeconomic confidence and policy stability. When people feel reassured about inflation, employment and predictable EMIs, they are more inclined to take significant financial risk, such as buying a home. We therefore anticipate a positive improvement in demand in the coming months.”

Industry experts highlight that the rate cut will encourage mid-income and first-time buyers, improve loan eligibility, and positively impact overall residential demand.