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Dive Deeper:
Bank of Maharashtra, Karur Vysya raise lending rates following RBI repo rate hike
Bank of Maharashtra raised the marginal cost of funding-based lending rate across tenors by 0.15%, while Karur Vysya Bank revised…
LIC Housing Finance hikes home loan interest rate by up to 40 bps. Details here
The LIC Housing Finance in its statement said that for borrowers with CIBIL score of 700 and above, the rate…
Did the RBI wait too long to raise interest rates?
It could have started highlighting inflationary worry points in February
RBI not 'behind the curve' in hiking rate, says Ashima Goyal on tackling rising inflation. Details here
Noting India is 'especially vulnerable' to the combination of food and crude oil inflation unleashed by the Russia-Ukraine war, Ashima…
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How central banks in India, US and other economies are fighting inflation
NEW DELHI: Global inflationary pressures are being faced by all economies alike. The surge in prices of key commodities has…
Retail inflation jumps to 8-year high of 7.79% in April
NEW DELHI: Retail inflation based on consumer price index (CPI) jumped to 8-year high of 7.79 per cent in April,…
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Will RBI rate hike be a dampener for real estate?

By Livemint
RBI rate hike impact on real estate: A repo rate hike makes borrowing costlier.

“The recent regulations by the Reserve Bank of India on increasing the repo rate by 40 bps, bringing them to 4.40%, may affect the real estate sector to an extent," said Rohit Malik, Founder, Clicbrics.

Right after RBI's announcement, many banks started increasing interest rates in lending and deposit schemes. To put it in simple terms, a repo rate hike makes borrowing costlier.

Rohit Malik, Founder, Clicbrics said the implication of a repo rate hike will be felt across all categories of loans. All the loans that come under Repo Linked Lending Rate (RLLR), like home loans and loans against the property, will now cost higher, and there will be an increase in other loans and EMIs as well. In addition, most banks have started increasing the Marginal Cost of Lensing Rate (MCLR) since the beginning of this fiscal year. These factors might affect consumers’ buying behavior. 

"On the flip side, the continued wage and job growth in the services sector will provide a cushion in the short term for the purchasing decisions. There is still pent-up demand post covid in affordable housing, and even after the repo rate hike, affordability is still at a multi-decade high and the home buyer needs to take advantage of that in the short term." he added.

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Dive Deeper:
Bank of Maharashtra, Karur Vysya raise lending rates following RBI repo rate hike
Bank of Maharashtra raised the marginal cost of funding-based lending rate across tenors by 0.15%, while Karur Vysya Bank revised…
LIC Housing Finance hikes home loan interest rate by up to 40 bps. Details here
The LIC Housing Finance in its statement said that for borrowers with CIBIL score of 700 and above, the rate…
Did the RBI wait too long to raise interest rates?
It could have started highlighting inflationary worry points in February
RBI not 'behind the curve' in hiking rate, says Ashima Goyal on tackling rising inflation. Details here
Noting India is 'especially vulnerable' to the combination of food and crude oil inflation unleashed by the Russia-Ukraine war, Ashima…
One subscription that gives you access to news from hundreds of sites
How central banks in India, US and other economies are fighting inflation
NEW DELHI: Global inflationary pressures are being faced by all economies alike. The surge in prices of key commodities has…
Retail inflation jumps to 8-year high of 7.79% in April
NEW DELHI: Retail inflation based on consumer price index (CPI) jumped to 8-year high of 7.79 per cent in April,…
Get all your news in one place