The festive season is the time when most Indians prefer to buy the property. The festive season begins from Navaratras and lasts till January and most potential buyers prefer to jump into the real estate sector during this auspicious time. 
 
To make the festive season sweeter, the RBI has reduced the repo rates to 5.15 percent which will further reduce the home loan rates. The RBI reduced their repo rate by 25 basis points on October 4th, bringing smiles and cheers to the potential buyers. 
For the buyers who have been on the fence whether to invest in the property or not, it is the right time to take advantage of the lower interest rates and buy the house of your dreams. The real estate sector of the country ash been suffering from slow sales across the country. To revive the sector, the government has been making efforts to boost sales and revive the sector. 
 
Though the four consecutive cuts already this year, the basic points of the repo rates have been reduced by 110 points. This the fifth consecutive reduction in the repo rate and the reduction of 25 bps has contributed to the reduction of repo rate basis points by 1335 overall in just one year. 
 
What does it mean for the home buyer?
Previously, even after the consecutive reductions, the banks were not passing the benefits to the loan lenders. As the RBI’s repo rate changes every 2 months, the reductions in the repo rates were not ending up with the buyers. The RBI has directed the banks to link their home loan rates to the repo rate, so the loan borrowers can enjoy the benefit of reduced loan rates without having to wait for months for the banks to rework on their interest rates. 
 
The SBI took the initiative and launched the repo linked interest rate which will mean that the interest rate in this is directly connected to the repo rate. Every time the RBI changes its repo rate, the interest rate will change as well. Other private banks such as ICICI Bank, HDFC Bank, Punjab National Bank, Central bank of India followed the suit and launched the repo rate link interest rate. 
 
The home buyer can fulfil their dream of buying their dream house with reduced home loan interest rates. The move from the RBI ahs brought cheers in this festive time to the potential homebuyer across the country. 
 
However, it is important to remember that the repo rate linked interest rate is a floating rate of interest. That means the rate of interest will change every time the RBI changes, increases or decreases, their repo rate. 
 
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