“Post-demonetization, RBI Governor may reduce rates; will be ‘advantage homebuyer’,”: Niranjan Hiranandani
~ Possibility of a 25-basis-point rate cut by the RBI Governor in the next policy review this Wednesday
MUMBAI, 05 DECEMBER 2016: As the nation deals with the challenges that followed demonetization, Reserve Bank of India (RBI) Governor Urjit Patel might opt to go in for a 0.25 per cent interest rate cut in the next RBI policy review this Wednesday (07 December 2016). “I expect the RBI Governor to do so with the aim of cushioning the impact of demonetization,” said Niranjan Hiranandani, CMD Hiranandani Communities and Founder-President, NAREDCO (West). For home seekers, it might just end up with positive gains from the expected scenario. “It might well be ‘advantage home buyer’ on the aspect of banks being flush with funds, and open to lending to customers – in this case, home seekers,” said Niranjan Hiranandani.
“The other advantage of the expected scenario is, if the RBI reduces rates, it will have a direct impact on home loan interest rates and EMIs,” he added. “Other factors remaining constant, we might see a 25-basis-point rate cut by the RBI this Wednesday,” he said.
Niranjan Hiranandani pointed out that this Wednesday will be the first monetary policy review after demonetization of old Rs 500 and Rs 1,000 currency notes. The RBI Governor, in his first policy review in October had reduced the repo rate (short term lending rate) by 0.25 per cent. This will be the second policy review based on recommendations of the Monetary Policy Committee. “The RBI has cut repo by 1.75 per cent since January 2015, pointed out Niranjan Hiranandani.
“For a home buyer, the impact of demonetization of Rs 500 and Rs 1000 notes on home loan interest rates could be positive, and we look forward to home seekers ‘dream homes’ becoming a ‘reality’ – with home loans that are expected to be on offer at lower interest rates,” Niranjan Hiranandani concluded.
~ Niranjan Hiranandani is Founder & MD, Hiranandani Group. His recent initiative is Hiranandani Communities. He is the Founder and First President (Maharashtra), National Real Estate Development Council (NAREDCO), which works under the aegis of Ministry of Housing & Urban Poverty Alleviation, Government of India.