RBI Monetary Policy: A Look At Real Estate Sector’s Wishlist Amid Dipping Residential Sales
ANAROCK’s Anuj Puri urges deeper rate cuts, full transmission of benefits, and sustained liquidity support ahead of MPC meet.
With the Reserve Bank of India widely expected to continue cutting the repo rate at its upcoming Monetary Policy Committee meeting scheduled for June 4 to 6, the Indian real estate sector is pinning its hopes on decisive action to address persistent challenges and unlock fresh growth avenues, said Anuj Puri, chairman of ANAROCK Group. The key decisions from the meeting will be announced on Friday.
Residential sales in the top seven cities dropped 28% in the first quarter of 2025, compared to a year ago. While luxury housing has held steady, the affordable housing segment remains under acute stress.
“Affordable housing is in serious need of direct support,” Puri said, adding that smaller developers are grappling with expensive debt and limited access to financing. ANAROCK data shows that affordable housing’s sales share fell from 38% in 2019 to 18% in 2024, even as unsold inventory in this segment dipped 19% in the past year, reflecting pent-up demand.
Anuj Puri, Chairman, ANAROCK Group (Image source: ANAROCK Press release)
In the press note, Puri stressed that the sector urgently needs deeper rate cuts and better transmission to borrowers. With inflation at a multi-year low of 3.16%, the RBI has the room to act, he said. “What is even more important is that the benefits of any further rate cuts are fully passed on to end borrowers, not just large developers,” he wrote.
Commercial real estate, meanwhile, is seeing rising demand for flexible workspaces and e-commerce-driven retail. However, Puri pointed out that rising construction costs and regulatory bottlenecks have hampered expansion, especially in smaller cities. Liquidity support will be crucial to help new projects in the commercial, warehousing and hospitality segments, he said.
Warehousing and hospitality, both expected to see strong growth, also face hurdles from high borrowing costs and project delays. Puri concluded that decisive policy action by the RBI could unlock the sector’s full potential, providing much-needed momentum for India’s real estate sector.
