Housing prices across the country are to be increased by 5-10% in the next 3-6 months. This is because of the rise in key policy rates by 25 basis points by the Reserve Bank of India (RBI). It is for the tenth time since March 2010 that the Reserve Bank increased the repo rates by 25 basis points to 7.5 percent. The reverse repo rates also are increased by a similar margin to 6.5 percent. The builders will be facing the increased interest rates because of the hike in repo and reverse repo rates. This is ultimately going to hit the consumers.
With increase in cost of money, the production and construction costs are even expected to go up leading to inflation.
Source: Economic times