Stable rates, steady growth: Good news for Indian homebuyers

5 Apr 2024 , 02:21 PM

The Reserve Bank of India’s decision to keep the repo rate at 6.5% for a seventh consecutive time as part of its expanded economic growth outlook and second monetary policy of 2024 is anticipated to sustain the housing property market’s stable growth pattern.

It is expected that the steady increase in sales of mid-range and luxury residential properties will continue, as will a cautious approach to the interest rate-sensitive low-income and affordable housing markets.

From 2020 to 2023, the primary market’s housing sales volumes increased at an annualised pace of 29%, reaching a 10-year high in 2023. Despite rising mortgage rates and an upward trend in pricing, the residential real estate industry maintained its growth momentum in the first quarter of 2024, with sales volume of over 86,345, up 9% from the previous year, according to statistics from Knight Frank India.

The steady rise in demand has accelerated the rate of residential building, to the point that the number of units introduced has surpassed sales numbers for the previous six quarters. The fact that the inventory level is currently 5.9 quarters as opposed to 6.7 quarters a year ago shows that the market’s overall traction has improved.

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