The reduction made by the Reserve Bank of India (RBI) just before the arrival of festive season will help in augmenting the demand in the housing sector, categorically in the affordable housing segment, as expected by the experts and real estate developers.

Reduced inflation numbers, improved monsoon, beneficial global situation and a general boost in the industry scenario are the motivating factors in this reduction of rate by RBI.

RBI has reduced the repo rate by 25 basis points bringing it down to 6% during its bimonthly policy review.

The Managing Director of SARE Homes says that this reduction by 25 basis points in repo rate will complement the recent policies of government like GST and RERA augmenting the demanding in housing sector.

On the other side, some are of the opinion that a higher lending rate would have provided the needed push to stimulate growth of India.

Since December 2014, RBI has reduced the lending rate by 175 basis points but the banks have not made much reduction in lending rates on their part.