03rd Nov 2012
Developers welcome CRR cut, expect reduced interest rates from RBI
No cut in Repo or interest rate by the Reserve Bank of India (RBI) in its recent policy review may have disappointed realty developers once again, but a positive move of reducing cash reserve ratio (CRR) by 0.25 per cent for banks have bought some hope for the Indian Real Estate Sector in-terms of liquidity inflow in the sector. MagicBricks.com brings you experts' and developers' reaction on the RBI's move and what are their expectations: “While this move of RBI will help the real estate sector with greater liquidity at its disposal, the cut in CRR will also help in increasing the borrow capacity of the sector which is sure to signal greater progresses in the business of the industry, says Neeraj Gulati, MD, Assotech Realty Pvt Ltd and member of CREDAI.
Is it a cautious stance by RBI in lieu of high inflation? “This move by RBI certainly reflects its concern over rising inflations,” says Gaurav Mittal, MD, CHD Developers and member, Governing Council, CREDAI. “The move by the apex bank was a bated breath for the industrial sector as the axe of inflation was taking a toll for the investor fraternity. This infusion of money would definitely bolster the economy at large, particularly the industrial sectors such as Real Estate,” adds Nikhil Jain, CEO, Ramprastha Group However, many believed that a reduction in the Repo rate would have boost investor sentiment this festive season. “The festive season coupled with an expected change in policy rates would have been the ideal time for improving consumer confidence, opined Anshuman Magazine, Chairman and Managing Director, CBRE South Asia.
“The cut in CRR may prompt banks to cut interest rates, keeping in mind the festive season,” adds Brijesh Bhanote, director – sales & marketing, 3C Group. “We hope Reserve Bank will look into the concerns raised over the Repo Rate cut in the next policy review which is a required trigger and encouragement to the real estate sector,” says Mittal. The cut in CRR may not have satisfied the developers, but it has certainly got them to pin their hopes on the next policy review.