The Reserve Bank of India took 2025 by surprise with a sharp policy change, thoughtfully deciding to cut the repo rate by 25 basis points to 5.25%, its lowest level in the last three years. An unanimous decision of the Monetary Policy Committee headed by Sanjay Malhotra, this action reflects the initiation of a rate cycle with gradually falling rates to stimulate the economy, which the Governor termed as a "rare Goldilocks period", is still self-reliant. The central bank also held its neutral position, meaning that it is still open for a next move in either direction.
Governor Sanjay Malhotra underlined that strong GDP growth, inflation coming down, GST rationalisation, and robust festive spending have combined to produce a perfect scenario for a measured push to inject liquidity and lift the spirit of the market. The rate cut is generally interpreted as a main driver of the mood in interest-sensitive sectors, most notably real estate in which developers and homebuyers are both looking forward to the revival of demand, quicker decision-making, and better affordability in the coming months.
What Real Estate Expert Believes
Mr. Sahil Agarwal, CEO, Nimbus Realty, says,"The market has been waiting for relief in interest rates for quite some time, and this repo rate cut is significant for both developers and homebuyers. We expect renewed customer interest in new launches as well as under-construction projects. This decision has the potential to drive a 15–20% rise in housing demand from the next quarter. We are confident that the momentum in NCR’s housing activity will become clearly visible in the coming months.”
Mr. B.K. Malagi, Vice Chairman, Experion Developers, says, "The real estate sector welcomes the announcement by the RBI reducing the repo rate by 25 bps. Effectively, it brings down the current lending rate to 5.25%, which is the lowest in the last three years and will encourage new home buyers. Besides, it will also reduce the EMIs for the buyers who have already taken the plunge. Real estate developers will also benefit from the lower interest rates. Coupled with benign inflation and a high GDP growth rate, the move will add to the real estate sector’s prospects."
Mr. Sehaj Chawla, Managing Director, TREVOC Group, says, “The cumulative softening of rates — with the latest 25 bps cut bringing the effective lending environment to 5.25% from 6.50% last year — marks a total reduction of 1.25%, which is a major boost for homebuyers. Lower borrowing costs directly translate into higher purchasing power and faster decision-making. Supported by stable inflation and strong GDP momentum, this move sets the stage for accelerated growth across the real estate sector.”
Mr. Sandeep Chhillar, Founder and Chairman, Landmark Group, says, "The RBI bringing the repo rate down by 25 basis points marks a strong pro-growth signal and undoubtedly benefits the real estate sector. With home loan rates likely to fall further, affordability will improve, especially for first-time homebuyers. This move is expected to reignite demand, sustain buyer interest, and create a favourable environment for continued growth across the housing market."
Dr. Gautam Kanodia, Founder, KREEVA and Kanodia Group, says, "The RBI’s move to cut repo rate by 25bps and bring it to 5.25% is in line with the sector’s expectations. The decision comes as a timely move aimed at stabilizing the economy in the coming year. This significant cut is expected to directly benefit the real estate sector by lowering home loan interest rates, thereby making homeownership more accessible. For developers, it paves the way for expanding their presence in the high-potential growth markets of NCR. On the whole, the decision is in favor of both."
Mr. Rajjath Goel, Managing Director, MRG Group says, “The 25 bps cut to 5.25% signals a clear shift towards an accommodative cycle and comes at the right time. Lower home-loan rates will directly improve EMI affordability and boost sentiment, especially among end users and upgrade buyers in Gurugram’s luxury housing market. Even this marginal reduction can accelerate conversions and strengthen demand. We expect this move to propel conversions in the coming quarter and further strengthen real estate’s position as a preferred long-term wealth-creation asset heading into 2026.”
Ms. Sakshee Katiyal, Chairperson, Home & Soul, says, "The RBI’s 25 bps rate cut arrives at a crucial time for the overall real estate sector. Softer interest rates tend to lift confidence across the board—homebuyers, investors, and even commercial occupiers. This reduction will support faster decision-making in residential purchases while also improving sentiment in office, retail, and mixed-use developments. As financial conditions ease, we expect a broader pickup in activity, with the rate cut reinforcing market stability and encouraging a more sustained growth cycle for the real estate sector as a whole.”"
Mr. Prateek Tiwari, MD, Prateek Group, says, "A rate cut by 25bps after two stable policy runs reflects the central bank’s comfort with inflation trends and overall macro resilience. This is a huge relief for homebuyers in Noida-Greater Noida, where demand for premium and luxury housing has been soaring. The reduction to 5.25% can meaningfully lower EMIs, making the year-end quarter more active. By 2026, this will help maintain housing supply momentum while supporting healthier, end-user-driven growth across the region."
Mr. Sauarb Saharan, Group Managing Director, HCBS Developments, says, “The impact of a rate cut by 25 bps, especially after two back-to-back pauses, cannot be underestimated. It signals economic confidence and encourages HNIs and NRIs to fast-track large-ticket decisions. Across Gurugram, ultra-luxury projects will see stronger traction in the year-end window, while 2026 will benefit from a more buoyant investment climate. This is a reassuring step that aligns with the strong demand fundamentals we are witnessing.”
Mr. Ashwani Kumar, Pyramid Infratech, says, "The 25 bps cut, especially after two consecutive status-quo policy announcements, signals a renewed push toward affordability and market confidence. For Gurugram’s end-user-driven corridors, this will encourage families who were delaying decisions due to rate uncertainties. As we enter the year-end buying cycle and prepare for 2026, this move is set to enhance absorption across well-connected micro-markets and support long-term stability in premium housing."
Mr. Salil Kumar, Director – Marketing and Business Management, CRC Group, says, “The reduction in the repo rate to 5.25% is a timely and encouraging step for the real estate sector. As developers, we see this move giving homebuyers much-needed confidence, especially young families and first-time purchasers who closely watch interest rate trends. With EMIs expected to ease, we foresee a clear rise in serious enquiries and a more steady improvement in overall sales momentum. This decision will support market stability and motivate more buyers to move forward in their homeownership journey.”
Mr. Bhupindra Singh, COO, RISE Infraventures, says "A 25 bps rate cut might appear incremental, but its timing, after two policy pauses, sends a powerful message to investors across both residential and commercial segments. For premium homebuyers, it encourages stability and high-value purchases. For commercial investors, it lowers financing costs and improves viability for Grade A developments and high-street retail. The sector is already seeing renewed interest from NRIs and domestic investors seeking diversified portfolios across NCR. This policy shift will strengthen year-end activity and support a robust, opportunity-rich 2026 across asset classes."
Mr. Piyush Kansal, Executive Director, Royale Estate Group says, “RBI’s 25 bps rate cut brings timely relief for homebuyers, and we fully support this decision. Even a small reduction in interest rates makes EMIs lighter and gives people the confidence to move ahead with purchases they were putting off. This step will revive genuine end-user demand and give the residential market the positive momentum it needs.”
Mr. Sanjay Sharma, Director, SKA Group, says, “The RBI’s decision to reduce the repo rate by 25 basis points to 5.25% and maintain a neutral stance is a highly encouraging move for the real estate sector. The cut comes at a strategically crucial time when homebuyer confidence is already strong, and this will further improve affordability—particularly in markets like Noida–Greater Noida and Ghaziabad, where rising aspirations are accelerating the shift towards luxury and premium housing. With liquidity-enhancing steps such as the Rs 1 lakh crore OMO purchase and the USD/INR swap, we expect borrowing conditions to ease gradually from December onward. This decision is likely to bring fence-sitters into active buying mode, helping developers witness a much stronger Q4 and setting the tone for an upbeat start to 2026.”
Mr. Shyamrup Roy Choudhury, Founder and Managing Director, Aura World says, "The 25 bps rate cut is a highly encouraging development for the luxury housing segment, where sentiment and confidence play a far larger role than affordability. Affluent buyers tracking macro trends will view this as a strong green signal to advance large-ticket purchases. Further, the reduced rate will strengthen liquidity for developers building high-spec, design-led communities. As we look toward 2026, luxury housing will continue gaining momentum, powered by wealth creation, asset diversification, and India’s rising global economic position."
Mr. Ashok Singh Jaunapuriya, MD & CEO, SS Group, says, “The 25 bps rate cut to 5.25% reflects the RBI’s confidence in the economy’s resilience and its commitment to supporting growth while keeping inflation anchored. For Gurugram’s premium housing market, where demand has remained robust even during the status quo phase, this reduction will reinforce positive sentiment among high-intent buyers who are evaluating long-term value creation. The neutral stance indicates policy flexibility going forward, which is reassuring for both homebuyers and developers. Stability, combined with improved affordability and easing liquidity, will further strengthen absorption levels in Gurugram’s luxury housing segment.”
Mr. Paras Rai, Director, Property Master, says, “The RBI’s 25 bps rate cut to 5.25% is a welcome step that will significantly uplift homebuyer confidence and improve affordability, particularly for those exploring premium and investment-led properties in NCR. Lower home-loan rates will reduce EMI burden, enabling faster purchase decisions and bringing fence-sitters back into the market. This policy shift, combined with strong economic fundamentals and strong demand momentum, is expected to accelerate residential absorption and fuel a more vibrant first quarter of 2026. The neutral stance also signals policy flexibility going forward, which is reassuring for both buyers and the real estate ecosystem.”
The RBI's recent 25-basis point repo rate cut is not only more than a regular policy adjustment, but it also signifies a major turning point for India's monetary cycle with a wide range of consequences for the real estate sector. After several quarters of elevated costs, tight liquidity, and cautious lender sentiment, the sector is now moving into a significantly more supportive environment. Easier credit conditions are expected to revive demand that has been lying dormant, purchase decisions that have been deferred will be expedited, and affordability will improve in both mid-income and premium housing.
Lower financing costs, better project viability, and more predictable cash flows are, therefore, the main factors developers will get from the reduction in their costs of borrowing–factors that will not only strengthen the sector’s supply pipeline but enhance the developers’ ability to operate in a stable environment. Also, a more accommodative rate environment usually encourages fresh domestic and international capital inflows, thus deepening India’s stature as one of the most resilient property markets globally.
.png)