The real estate sector has welcomed the Reserve Bank of India’s decision to maintain the repo rate at 5.25% and continue with a neutral stance. The move provides a stable policy environment that is critical for preserving housing affordability and sustaining buyer confidence. Consistency in interest rates supports informed investment decisions, ensures smoother access to financing, and strengthens overall market sentiment. With both residential and commercial real estate segments demonstrating strong fundamentals, the RBI’s decision is expected to maintain growth momentum, encourage long-term investments, and provide the predictability required for sustained sectoral expansion.
Anuj Puri, Chairman – ANAROCK Group The RBI’s Monetary Policy Committee (MPC) decision to keep the repo rate unchanged is a key anchor for the Indian residential real estate market. The sector is witnessing strong annual growth amid short-term geopolitical shocks, and this rate pause reflects rising consumer pressures and volatile construction environments.
External vulnerabilities have tested the broader macroeconomic environment in early 2026. The ongoing war in the Middle East is having direct economic effects, including higher global oil prices and higher domestic construction costs. This sort of supply-side inflation is putting pressure on developers.
Also, rising geopolitical uncertainty has led many potential Middle Eastern investors, who tend to put large amounts of money into Indian housing, to pause their buying. Constant borrowing costs mean that the market is not being punished by rising material costs and rising loan rates.
According to ANAROCK Research, residential sales declined 7% quarter-on-quarter (Q-o-Q) with approx. 1,01,675 units sold in Q1 2026 vis-à-vis 1,08,970 units in Q4 2025. Total value of sales fell 5% q-o-q to INR 1.51 Lakh Crore. On the other hand, demand is still strong Y-o-Y. Sales volume and sales value in Q1 2026 grew by 9% and 6% respectively over Q1 2025 that saw sales of 93,280 units worth INR 1.42 Lakh Crore.
New project launches are now outpacing sales velocity, reversing post-pandemic trends. Total new supply increased sequentially by 2% and was up 26% YoY, meaning more than 1,26,265 units were newly launched in Q1 2026. Therefore, the unsold inventory available rose by 4% QoQ and 7% YoY to go beyond 6.01 lakh units by the end of Q1 2026. To absorb this growing inventory, a stable and affordable financing environment is needed.
The MPC’s policy consistency is a stabilising buffer. Input costs are rising and need to be managed carefully, but domestic consumer demand is fundamentally resilient. The Central Bank’s efforts to stabilize the Indian rupee will help boost import of fixtures and fittings in the luxury segment, which currently accounts for 20% of the housing supply as of Q1 2026.
Overall, this rate pause has shielded home loan structures, enabling the sector to absorb inventory gains and keep growth story going through 2026.
Ashish Bhutani, CEO, Bhutani Infra said, “The RBI’s decision to maintain the repo rate at 5.25% while retaining a neutral stance reflects a measured and pragmatic approach amid global uncertainties and evolving inflation dynamics. For the real estate sector, stability in interest rates is as important as rate cuts, as it strengthens buyer confidence and enables long-term investment planning. A predictable borrowing environment allows homebuyers to make informed decisions and supports developers in executing projects efficiently. We expect the continued stability in the interest rate regime to sustain housing demand across segments, particularly in the mid-income and premium categories, while contributing positively to the sector’s growth momentum.”
Khalid Masood, Managing Director, Shalimar Corp said, “We appreciate the decision of RBI of not changing the repo rate. Changes in the repo rate happen a lot as this can affect how much it costs to borrow money. It can also change what buyers decide to buy especially when it comes to houses. The real estate sector does well when things are predictable. When interest rates are stable people who build houses, people who invest in houses and people who buy houses can plan better. Manage their money more wisely. The real estate sector likes it when things are stable so a stable interest rate is good, for the real estate sector.”
Mohit Mittal, CEO – MORES on RBI MPC June 2026 Policy said, “The pause was expected, but it still matters. At 5.25%, we’ve already absorbed 125 basis points of cuts since early 2025 — and that cycle is now working its way through EMIs, home loan rates, and buyer sentiment on the ground. Markets wanted another cut. They won’t get it today. Crude is climbing, the rupee is under pressure, and the RBI is reading that room correctly. For residential real estate across India, the real question is how long this pause holds. The cumulative rate relief of the last 12 months has already unlocked a demand cohort that was sitting on the fence — across affordable, mid-segment, and premium housing alike. Another cut later in FY27 would extend that window further. But even today’s hold doesn’t reverse the trajectory. The sector’s fundamentals are stronger than a single policy decision. Rate policy accelerates the cycle — it doesn’t create it.”
Ravi Kant, Co-founder, Elegance Enterprises & Elegance Infra said, “The RBI’s decision provides much-needed visibility for both developers and homebuyers at a time when the real estate sector continues to witness strong demand. Interest rate certainty plays a critical role in purchase decisions, particularly in the mid-income and premium housing segments where financing remains a key consideration. A stable monetary environment supports investment confidence, enables smoother project execution and helps sustain the momentum that the sector has built over the past few years. For real estate, predictability is often as important as the rate itself.”
Raghunath Reddy Bhattagiri, Co-founder & MD, Triguna Projects said, “The repo rate decision reinforces confidence across the real estate ecosystem. Stable borrowing costs encourage homebuyers to move forward with purchase decisions while allowing developers to plan investments with greater certainty. Beyond residential housing, sectors such as plotted developments, mixed-use communities and commercial real estate also benefit from a predictable interest rate environment. Consistency in monetary policy supports long-term growth, improves affordability, and strengthens overall market sentiment.”
Vikas Garg, Joint Managing Director, Ganga Realty said, “The RBI’s decision to keep the repo rate unchanged is a significant and positive development for the real estate sector. The move comes at a time when the residential market continues to demonstrate strong momentum and growing consumer confidence. Stability in interest rates will provide much-needed comfort to homebuyers, particularly those relying on housing finance, enabling them to make purchase decisions with greater confidence. It also creates a favourable environment for developers by supporting sustained demand across key housing segments. With rapid urbanization, rising disposable incomes, and continuous infrastructure development driving residential demand, policy stability plays a crucial role in maintaining market momentum. We believe that the RBI’s balanced approach will further strengthen buyer and investor sentiment, encourage long-term investments, and support the overall growth trajectory of the real estate sector. Going forward, this stability is expected to boost housing sales, enhance affordability, and contribute positively to the sector’s sustained expansion.”
Mr Vimal Nadar, National Director & Head, Research, Colliers India RBI has maintained the repo rate at 5.25% and continued with the neutral stance, while taking cognizance of the likely inflationary concerns arising out of prolonged West Asia crisis and consequent impact on supply chains. High crude oil prices and a depreciating Rupee have added to the downside risks across economic sectors, including real estate.
While growth remains resilient, the impact of cost pressures has started to become visible and is likely to weigh in. Overall construction costs are already on the rise led by increasing material and labour costs, which may lead to workforce inadequacy and delayed project timelines. This rise in construction cost is likely to be ultimately passed on to homebuyers in the form of higher property prices, thus affecting affordable and middle-income housing segments. However, this will depend on the intensity and duration of the ongoing global headwinds. The likelihood of a potential rise in repo rate and hence home loan interest rates cannot be fully eliminated in the next few quarters.
While homebuyers are likely to assess their income visibility more stringently before purchasing homes, developers are expected to prioritise construction material adequacy, cash flow management and project execution in the near to mid-term.
Mr Tanuj Shori, Founder & CEO, Square Yards “For aspiring homebuyers, the RBI’s decision to maintain the repo rate at 5.25% provides a stable environment for financial planning and reinforces confidence in long-term property purchases. With borrowing costs remaining steady, homebuyers can evaluate opportunities with greater certainty, which is particularly important for end-users and first-time buyers.
Beyond the rate decision, the measures announced to encourage greater participation by NRIs, OCIs, and foreign investors in Indian financial markets are a significant positive for the broader economy. By facilitating higher overseas investments and enhancing the attractiveness of Indian debt and equity markets, these initiatives are expected to support capital inflows, strengthen investor confidence, and reinforce India’s position as a preferred global investment destination.
For the real estate sector, stronger economic sentiment and deeper engagement from the global Indian diaspora could translate into increased interest in residential assets. NRIs already account for a meaningful share of premium housing demand, and these measures are likely to further strengthen their confidence in India’s long-term growth story. Combined with a stable interest rate environment, this should provide continued support to housing demand across key residential markets.”
Mr Akhil Saraf, Founder & CEO, Reloy (A proptech Firm) By maintaining the policy rate steady, the RBI has indicated that the government expects the Oil Crisis to stabilise and inflation to be under check. The effect on construction costs is becoming increasingly apparent, though they remain manageable for now. This decision is a positive sign for the housing sector, where interest rate stability remains critical for affordability and buyer confidence. A prolonged period of steady borrowing costs will continue to support residential demand, particularly among first-time homebuyers and upgraders, while also providing developers with greater visibility for project planning and investments.
Mr Shrinivas Rao, FRICS, CEO, Vestian said, “The Reserve Bank of India kept the repo rate steady amid evolving global uncertainties to gauge its overall impact on the Indian economy before initiating any rate-hike cycle. This decision has provided some financial relief to the real estate sector, which continues to grapple with rising construction costs driven by elevated inflation. Developers and investors also continue to benefit from unchanged borrowing costs, helping sustain healthy demand-supply dynamics in the market. However, the central bank is likely to hike repo rate in the coming months to contain inflationary pressures stemming from rising fuel prices and the prospect of a weaker monsoon.”
Mr. Pradeep Aggarwal, Founder & Chairman, Signature Global (India) Ltd. “We welcome the RBI’s decision to keep the policy rate unchanged at 5.25%. In an environment marked by ongoing geopolitical uncertainties and uneven global growth, policy continuity provides much-needed stability for both businesses and consumers.
This steady stance also reinforces confidence in the domestic growth story. For the real estate sector, predictability in interest rates is a key driver of demand, as it directly influences homebuyer sentiment, affordability, and long-term investment planning. Stable borrowing conditions encourage committed purchase decisions, particularly in the mid-income and premium housing segments.
At a time when global volatility continues to shape economic outlooks, the RBI’s approach supports sustainable growth while ensuring financial stability. This balance is essential for sectors like housing, which are closely linked to consumption, employment generation, and overall economic momentum.”
Mr. Jash Panchamia, Executive Director, Jaypee Infratech Limited. The RBI’s decision to keep policy rates unchanged is a prudent and reassuring move. Stability in interest rates is critical for maintaining consumer confidence, particularly in the housing sector, where financing plays a key role in purchase decisions.
Over the past few quarters, declining interest rates have significantly improved housing affordability and encouraged many fence-sitters to move ahead with their home-buying plans. With the RBI maintaining the status quo, home loan rates are expected to remain attractive, providing continued support to both end-users and investors.
For the real estate sector, this creates a favourable environment where demand can sustain its momentum, particularly in mid-income and premium housing segments. Coupled with ongoing infrastructure development and strong economic fundamentals, stable borrowing costs will help strengthen buyer sentiment and support long-term growth in the residential market.
Mr. Umesh Gowda H A, chairman and founder of Sanjeevini Group The status quo on policy rates while retaining neutral stance signals the RBI’s focus on maintaining a stable interest rate environment in order to spur growth amidst the prolonged geopolitical tensions in West Asia that continue to exert pressure on commodity prices and currency markets and inflationary risks.
For the housing sector, rising construction costs and supply obstructions can have an impact on overall housing market. Any rise in price may be detrimental for housing sales and therefore, a stable policy environment will help not just homebuyers in planning their purchase but also developers to adjust their sales and supply pipelines in order to maintain affordability.
Mr. Ankur Jalan, CEO, Golden Growth Fund (GGF), a category II Real Estate focussed Alternative Investment Fund (AIF), The RBI’s decision to keep policy rates unchanged and retain ‘neutral’ stance reflects a prudent approach amid ongoing geopolitical uncertainties, volatile commodity prices and global market disruptions. A status quo provides stability and predictability that investors value during uncertain times.
For the real estate sector, two factors are beginning to play out – shift of investment from the middle east and financialization of real estate as uncertainty around the real estate sector persist.
Besides, as traditional asset classes such as equities and bonds remain susceptible to geopolitical developments and market volatility, well-structured Alternative Investment Funds (AIFs) can offer investors access to tangible assets, relatively predictable cash flows and portfolio diversification. Amidst rising inflation, AIFs are increasingly emerging as a preferred avenue for high-net-worth and institutional investors seeking risk-adjusted returns enhancing its attractiveness.
We believe the current environment could accelerate the shift towards alternative investments, with investors focusing on income-generating assets. The RBI’s stable rate stance provides a conducive backdrop for long-term capital deployment, and quality real estate assets remain well-positioned to attract both domestic and global capital.
Mr. Lalit Parihar, managing director, Aaiji Group, a Dholera-based real estate firm The RBI’s decision to maintain a status quo on policy rates is a welcome move for the real estate sector and overall economy. Given the current economic backdrop marked by geopolitical uncertainty, inflationary pressures, elevated commodity prices and a weakening rupee, while having some impact on inflation, but a stable policy environment will spur India’s growth.
In this environment, policy continuity would be a positive outcome for the real estate sector. The housing market is currently navigating a combination of rising construction costs, cautious investor sentiment and some moderation in demand. A stable interest rate regime would help preserve affordability, support buyer confidence and provide greater flexibility to developers and investors alike.
The sector remains fundamentally resilient. Developers are increasingly focusing on cash-flow discipline, calibrated launches and timely project execution. We believe the industry is well positioned to adapt to the current disruptions, and a stable monetary policy framework will further support capital deployment, construction activity and overall market confidence.
Mr. Raoul Kapoor, Co-CEO, Andromeda Sales and Distribution Pvt. Ltd. The Reserve Bank of India’s decision to maintain the status quo on policy rates comes as a significant relief amid ongoing geopolitical uncertainties, rising crude oil prices, global supply chain disruptions, and broader economic volatility.
At a time when inflationary pressures remain a concern and global markets continue to face uncertainty, the RBI’s decision reflects confidence in the stability of the domestic economy while balancing growth and inflation objectives.
For the housing sector, the move is particularly encouraging. The status quo means home loan interest rates are likely to remain stable at around 7%–7.25%, providing much-needed comfort to both existing borrowers and prospective homebuyers. Those currently servicing home loans can continue to benefit from lower EMIs compared to the high-interest-rate environment witnessed during 2022–24, while new borrowers can plan their home purchases with greater confidence and affordability.
Stable interest rates, coupled with strong housing demand and improving infrastructure, are expected to further support residential real estate activity. Overall, the RBI’s decision provides a positive signal for consumers, businesses, and the housing market at a time when stability is crucial for sustaining economic momentum.
Mr Amit Goyal, MD, India Sotheby’s International Realty The RBI’s decision to hold the repo rate steady at 5.25% is, in my view, a necessary call at a moment of considerable uncertainty. Crude oil prices are rising sharply on the back of prolonged geopolitical tensions in West Asia, rising inflation and climbing construction costs are already showing up in project budgets and delivery timelines. The Central Bank is walking a real tightrope in early 2026.
For the Indian real estate sector, stable borrowing costs are a critical lifeline as they keep home loan EMIs predictable, protect buyer affordability and prevent demand from softening at a time when the market has been showing genuine momentum. Developers too are able to quietly absorb rising input costs. If sustained, it could compress margins, slow new launches, and in some cases, push project timelines.
The RBI’s projection of 6.9% GDP growth for FY27 is reassuring and tells us that India’s macroeconomic foundation remains intact. But with inflation forecasts revised upward to 4.6% and the rupee under pressure from global energy shocks, the operating environment is tightening. The rate pause has bought us valuable breathing room on how effectively the sector uses it will determine how the growth story holds through the rest of the year.
Developers believe that the RBI’s decision comes at an opportune time when residential demand is being supported by rapid urbanisation, infrastructure expansion, rising disposable incomes and a growing preference for homeownership among Indian families.
Market experts suggest that while the industry had largely anticipated the central bank’s decision, the continuation of a stable rate regime is likely to keep housing demand resilient in the coming quarters. With infrastructure-led growth creating new residential destinations and homeownership remaining a priority for Indian families, developers expect the sector to continue its growth trajectory supported by strong fundamentals and favourable consumer sentiment.
For the real estate sector, the latest monetary policy reinforces an important factor driving the market today confidence. And in an environment where both buyers and developers are looking for long-term visibility, stability may prove to be as valuable as a rate cut itself.