The Reserve Bank of India (RBI) will be conducting its next Monetary Policy Committee (MPC) meeting in a very challenging situation. On one hand, the real estate industry is eager to know which way RBI is going to direct the policy, and then again, various macroeconomic factors are at play like global conflicts, fluctuating crude prices, sustained inflationary pressure, and overall world economic uncertainty. Industry players agree that the main issue is not the lack of demand for residential property, the gradual expansion of commercial leasing activity, and the growth in institutional investments, but instead, that these factors don't call for immediate action on cutting rates; rather a cautious approach is required at this stage of the economic cycle.
Real estate experts in our country have the belief that RBI should stick to the presently fixed repo rate level which in their opinion serves the dual purpose of controlling inflation and safeguarding financial stability besides not dampening the spirit of economic growth. Maintaining low-interest rate conditions gives developers, homebuyers, and investors confidence that their borrowing costs are going to be predictable and it supports their long-term decision making. Besides that, industry experts also say that the RBI's stance on inflation, liquidity, and future policy direction will remain under the radar as these factors will affect market conditions not only at the residential level but also in commercial real estate as well as for institutions.
Experts Opinions
Mr. Umesh Gowda H A, Chairman and Founder, Sanjeevini Group
"The upcoming RBI Monetary Policy Committee meeting comes at a time when the global economy is grappling with heightened geopolitical tensions, persistent supply chain disruptions and renewed inflationary pressures, particularly due to rising energy prices. In such an environment, we expect the RBI to prioritize macroeconomic stability over monetary easing. While a status quo on the repo rate appears to be the most prudent approach, the central bank's commentary on inflation and liquidity will be equally important. For the real estate sector, stable interest rates provide certainty to both developers and homebuyers, allowing investment and purchase decisions to continue without disruption. India's housing market has demonstrated resilience over the past few years, and policy stability will help sustain this momentum despite global uncertainties."
Mr. Ankur Jalan, CEO, Golden Growth Fund (GGF), a Category II Real Estate Focused Alternative Investment Fund (AIF)
"The upcoming RBI Monetary Policy Committee meeting assumes greater significance amid escalating geopolitical tensions, volatile crude oil prices and persistent inflationary risks. In this environment, we expect the RBI to adopt a cautious and calibrated approach, with a status quo on policy rates being the most likely outcome. For real estate-focused AIFs, macroeconomic stability and policy predictability are more critical than short-term rate movements. A stable interest rate environment supports disciplined capital allocation, sustains investor confidence and enables developers to execute projects without facing abrupt increases in financing costs. India's real estate sector continues to benefit from strong structural demand, rapid urbanisation and increasing institutional participation. As long as inflation remains under control and financial conditions remain stable, the sector is well-positioned to attract long-term domestic and global capital. We believe a measured policy stance by the RBI will reinforce confidence among investors and further strengthen the investment case for professionally managed real estate assets."
Mr. Lalit Parihar, Managing Director, Aaiji Group
"Escalating geopolitical conflicts have increased the risk of imported inflation through higher crude oil and commodity prices. In this backdrop, we believe the RBI will remain cautious and maintain its focus on anchoring inflation expectations. While the real estate sector always welcomes lower borrowing costs, preserving economic stability is a larger priority. A measured policy stance will reinforce investor confidence and ensure that financing costs remain predictable. The housing sector today is driven by genuine end-user demand and improved affordability, making it resilient enough to withstand a temporary pause in monetary easing. Once global uncertainties subside, the RBI will have greater flexibility to support growth through calibrated policy measures."
Mr. Mukesh Choudhary, Managing Director, Accuspace
"The RBI faces the delicate task of balancing economic growth with inflation management amid an increasingly volatile global environment. Given the geopolitical risks and the possibility of elevated inflation, we expect the MPC to adopt a wait-and-watch approach. Such a stance would reassure both domestic and foreign investors who value policy consistency during uncertain times. For the real estate sector, especially commercial assets and institutional investments, predictable interest rates are often more valuable than abrupt policy shifts. A stable monetary environment supports long-term capital deployment, strengthens financing conditions and reinforces India's position as an attractive real estate investment destination."
Across the real estate industry, a general understanding that policy stability will be extremely beneficial in the present world environment as contrasted to aggressive monetary easing has developed between different parties involved. Executives within the industry think that preserving the present policy rate and watching closely the developments in prices and availability of funds will probably help keep the market in equilibrium. Also, it will continue attracting investments and give developers an idea of financial forecasting that is more accurate and reliable. Given uncertainties at the world levels, there is a great expectation from the RBI to come up with policies that will be neither rash nor too conservative but rather a balanced one so that the confidence in the Indian real estate will be reinforced and So, its long-term growth will be better supported.
Going forward, the market will closely watch the RBI's guidance on inflation, liquidity and the future rate trajectory. Any indication of a calibrated easing cycle, supported by adequate banking system liquidity, would improve the transmission of lower lending rates, strengthen housing affordability and provide an additional boost to mortgage demand and residential sales
"The upcoming RBI Monetary Policy Committee (MPC) meeting comes at a time when the global economy continues to face heightened uncertainty due to geopolitical tensions, trade disruptions, and volatile commodity prices. While these external headwinds warrant a cautious approach, domestic inflation remains well within the RBI's manageable range, providing the central bank with adequate room to maintain policy stability.
The housing sector has been witnessing healthy demand, supported by lower home loan rates, improving affordability, and strong consumer confidence. The accommodative interest rate environment has encouraged many first-time as well as end-user homebuyers to enter the market. Maintaining this supportive policy stance will help sustain housing demand, strengthen allied industries, and continue contributing meaningfully to India's economic growth."
Ashish Narain Agarwal, Founder & Managing Director, PropertyPistol
"A stable repo rate at 5.25% would provide much-needed certainty to the housing market. While borrowers may have hoped for further easing, maintaining the current rate helps preserve financing stability, allowing homebuyers to plan their purchases with greater confidence. Over the next 6–12 months, we expect residential demand to remain resilient, particularly in the mid-income and affordable housing segments, supported by steady employment trends, improving infrastructure, and sustained end-user demand. At the same time, buyers will continue to closely monitor inflation, property prices, and overall economic conditions alongside borrowing costs before making purchase decisions."
The most supportive policy signal would be the RBI's continued commitment to maintaining inflation within its target range while ensuring adequate liquidity in the financial system. Beyond repo rate movements, efficient transmission of monetary policy by lenders plays a crucial role in improving housing affordability. A stable interest rate environment, coupled with healthy credit availability for both homebuyers and housing finance institutions, would strengthen buyer confidence, improve financing accessibility, and support sustained growth in the residential real estate sector.
Mr. Vishal Raheja, Founder & Managing Director, InvestoXpert Advisors
"An unchanged repo rate would reinforce policy stability, which is generally positive for the housing market. Since the RBI has already reduced the repo rate by a cumulative 125 basis points since early 2025, the focus now is on the transmission of those benefits into home loan rates rather than another immediate rate change. If lending rates remain stable and economic conditions continue to support income growth, homebuyer sentiment should remain healthy. We expect residential demand to stay resilient over the next 6–12 months, particularly in end-user driven markets where affordability, employment and confidence are the primary demand drivers."
The most supportive signal would be a continued focus on effective transmission of existing rate cuts and adequate liquidity in the banking system. Lower borrowing costs benefit homebuyers only when banks and housing finance institutions pass on those benefits efficiently. A stable policy environment, healthy credit availability & sufficient liquidity will improve affordability and support housing demand more effectively than a standalone repo rate cut. This approach also gives lenders and borrowers greater confidence to plan long-term investments.
Akshay Taneja, CEO, TDI Infrastructure
"Infrastructure is the first signal of confidence in any emerging real estate market. Every major road, expressway or transit corridor improves connectivity, and better connectivity naturally attracts businesses, retail, social infrastructure and employment. As these elements come together, a location evolves from being merely accessible to becoming genuinely livable, creating a cycle where end-user demand and investment interest reinforce each other. We are seeing this play out across North NCR, where infrastructure upgrades are steadily changing buyer perception of locations such as Kundli. Affordability draws homebuyers seeking larger living spaces and a better quality of life, while improving connectivity and planned urban development create confidence among investors, including the growing NRI community, looking for long-term capital appreciation. This is why infrastructure alone doesn't create a hotspot—it sets in motion an ecosystem where connectivity attracts investment, investment drives development and development ultimately delivers sustained value. Industry estimates indicating continued growth in NCR's residential absorption only reinforce that buyers today are backing destinations with strong infrastructure as well as a clear long-term growth story. "
"Infrastructure undoubtedly creates the foundation for a real estate hotspot, but what truly sustains its growth is the experience people associate with that location. Buyers today don't invest in roads alone—they invest in a lifestyle. Once a region is connected through expressways or metro corridors, the next phase is shaped by quality residential developments, social infrastructure, retail, green spaces, and public amenities that encourage people to live, work, and spend time there. This is particularly evident in New Gurugram, where infrastructure has accelerated demand, but the real value has been created by the emergence of integrated communities offering a complete urban ecosystem. Gurugram continues to account for a significant share of NCR's premium housing launches, reflecting strong buyer confidence in well-planned micro-markets. We believe infrastructure may bring people to a location, but thoughtful development and long-term livability are what drive sustained price appreciation, attract institutional and NRI investments and transform an emerging corridor into a mature real estate destination."
"If the RBI maintains the repo rate at 5.25%, it will reinforce confidence in an already resilient residential market by providing certainty around borrowing costs and creating a stable environment for homebuying decisions. The broad consensus reflected in the Reuters poll, where 68 of 72 economists expect the RBI to maintain the repo rate at 5.25% through the remainder of 2026, underscores confidence that policy stability will continue to support homebuyer sentiment, financing decisions and healthy residential demand over the next 6–12 months. For homebuyers, predictable EMIs enhance purchase planning and affordability, while developers benefit from greater visibility in project execution, financing and long-term capital allocation."
The most supportive RBI policy signal for the housing sector would be a continued commitment to price stability, a predictable interest rate trajectory, faster transmission of policy rates into home loan pricing by banks, and adequate systemic liquidity to ensure efficient credit flow. Together, these measures would improve housing affordability, make home loans more accessible, strengthen end-user demand, and enable developers to plan investments, financing and project execution with greater confidence. A stable and well-transmitted monetary policy environment will play a pivotal role in sustaining long-term growth across India's residential real estate sector.
R. Nagaraj Reddy, Founder & Managing Director, Abhee Ventures
"The conversation around real estate growth often begins with infrastructure, and rightly so. Improved connectivity has the ability to enhance accessibility and influence buying interest. However, infrastructure alone does not determine whether a location evolves into a genuine real estate hotspot. Today's homebuyers evaluate locations through a much broader lens. Along with connectivity, they consider access to schools, healthcare facilities, workplaces, retail, green spaces, and the overall quality of life a neighbourhood can offer. There have also been instances where infrastructure projects generated significant interest initially, but demand remained limited because the supporting social infrastructure, employment opportunities, and residential development did not progress at the same pace. In the long run, locations that combine strong infrastructure with thoughtful urban planning and a well-developed social ecosystem are the ones that continue to attract homebuyers and create lasting value."
Ashish Agarwal, Director, AU Real Estate
"The real estate market has demonstrated strong resilience despite global economic uncertainties, and we expect this momentum to continue. An unchanged repo rate can strengthen. For developers, stability in the interest rate cycle is an important enabler as it encourages buyer confidence and supports long-term business planning. Homebuyers today are driven by product quality, location, lifestyle offerings and trust in the developer, with financing being one of several considerations. A stable policy environment will help sustain demand, encourage new project launches and strengthen the overall market. "
Sri Rajnikant Mishra, Founder and Chairman Amrawati Group
"With the repo rate expected to remain at 5.25%, we foresee a period of policy stability that will help maintain confidence across key sectors of the economy. A predictable interest-rate environment enables both developers and homebuyers to make long-term financial decisions with greater certainty. For the real estate industry, this continuity is expected to sustain healthy demand, support project execution, and reinforce housing as a resilient and preferred investment avenue amid evolving market conditions."
Ravi Kant, Founder, Elegance Enterprises
"We expect the RBI to adopt a prudent and measured stance in its upcoming monetary policy revision. While the domestic inflation scenario has been largely satisfactory, global risks, changing trade scenarios, and geopolitical considerations continue to necessitate caution. A steady interest rate regime fosters investor confidence and helps plan investments, as also brings stability in borrowing and lending. It is most likely that the Monetary Policy Committee will take any decision based on the flow of macroeconomic data. On the whole, the emphasis needs to be placed on promoting growth without compromising on inflation expectation stability and financial stability."
Neeraj K. Mishra, Executive Director, Ganga Realty
We expect the RBI to maintain a balanced and calibrated approach in the upcoming monetary policy. A stable repo rate would provide continuity and confidence to both homebuyers and developers, especially at a time when the housing market continues to witness healthy demand across key segments. Policy stability helps preserve affordability, supports buyer sentiment, and enables long-term investment decisions. For the real estate sector, sustained interest rate stability can further strengthen momentum in residential sales and encourage fence-sitters to advance their homeownership plans. We remain optimistic about the sector's growth trajectory, backed by strong end-user demand and improving economic fundamentals.
HS Kandhari, Co-Founder & Executive Director, Harmony Infra Ventures
"The real estate industry will welcome the continued pause as the repo rate has been held at 5.25% for three consecutive reviews. If the cost of capital is stable developers can confidently plan for project financing and construction timelines instead of hedging against rate volatility each quarter. For homebuyers, steady EMIs remain a key factor in converting intent into bookings, particularly in the mid and premium housing segments. On the supply side, a stable rate environment eases pressure on developer borrowing costs and NBFC funding lines, both of which had tightened through earlier rate cycles. At this stage, the industry would rather see continuity in policy stance than a rate cut that risks reversal within a few quarters. In a capital-intensive sector like real estate, predictability sustains momentum more than any single rate action."
Raghunath Reddy Bhattagiri, Co-founder & MD, Triguna Projects
"The next RBI monetary policy will be characterized by a measured approach driven by data. The domestic economy being resilient and inflation levels stable, the central bank will have enough space to take stock of changing developments at the international and domestic level without having to make any changes in policy. Keeping the current repo rates unchanged will help ensure continuity and stability for firms, households, and the market. Meanwhile, RBI will be careful about external challenges and the movement in the prices of commodities and liquidity."
"If the RBI maintains the repo rate at 5.25%, it will reinforce stability and predictability, both of which are critical for the housing market. The cumulative easing undertaken over recent policy cycles has already improved borrowing conditions, and keeping rates unchanged allows lenders to continue transmitting these benefits while giving homebuyers greater confidence in their financial planning. Over the next 6–12 months, we expect residential demand to remain healthy, particularly in the mid-income and premium housing segments, supported by rising urbanisation, infrastructure investments and improving household incomes. While interest rates continue to influence affordability, today's homebuyers are equally focused on long-term asset appreciation, project quality, developer credibility and location. A stable rate environment reduces uncertainty, encourages end-user demand and supports sustained growth in the residential real estate market without creating speculative activity."
The most supportive policy signal from the RBI would be one that reinforces policy stability, adequate liquidity and efficient transmission of earlier rate actions. While the headline repo rate remains important, ensuring that lending rates continue to reflect the cumulative monetary easing will have a more meaningful impact on housing affordability. A stable interest rate environment enables banks to price mortgages competitively, improves credit availability for homebuyers and provides developers with greater confidence to plan and execute projects. Equally important is maintaining sufficient liquidity within the banking system, which supports construction finance and facilitates timely project completion. As India's housing sector continues to benefit from structural drivers such as urbanisation, rising incomes and infrastructure-led development, a predictable monetary policy framework will strengthen buyer confidence and create a sustainable financing ecosystem for both consumers and the real estate industry.
Avneesh sood, Director, Eros Group,
"If the RBI keeps the repo rate unchanged at 5.25%, it will provide stability and confidence rather than trigger a sharp increase in housing demand. A stable interest-rate environment allows homebuyers to plan their finances with greater certainty, but purchasing decisions will continue to depend largely on property prices and income growth."
"The market is already showing this trend. Housing sales across the top seven cities declined 6% year-on-year to about 90,715 units in Q2 2026, despite a relatively stable rate environment. At the same time, affordable housing accounted for just 6% of new launches, while premium and luxury projects continued to dominate supply. Over the next 6–12 months, premium and luxury demand should remain resilient, whereas affordable and mid-income segments are likely to recover gradually. Sustained demand will depend more on affordability improvements than on interest rates alone."
The most supportive RBI policy signal would be a stable and predictable interest-rate environment, backed by adequate banking system liquidity. Policy certainty enables homebuyers, developers and lenders to plan with greater confidence than frequent rate changes. The RBI's decision to maintain the repo rate at 5.25% and a neutral policy stance supports financing stability, while the 1.25% standard asset provisioning norm for under-construction commercial real estate projects substantially lower than the initially proposed 5% helps keep developer financing costs manageable. However, monetary policy alone cannot restore affordability. Rising residential prices and the limited supply of affordable housing remain the biggest constraints. A stable rate environment, combined with supportive financing conditions and measures that improve housing supply, would provide the strongest foundation for sustainable demand across housing segments.
