RBI Repo Rate unchanged at 5.25%: How does this impact homebuyers?

The RBI has maintained the repo rate at 5.25% in its February policy review, retaining a neutral policy stance.

February 6, 2026: The Reserve Bank of India has kept the repo rate unchanged at 5.25%, extending the current borrowing-cost environment at a time when housing demand continues to hold up across major cities. The announcement followed the Monetary Policy Committee meeting held from February 4 to February 6, where members voted unanimously to maintain the existing rate. RBI Governor Sanjay Malhotra said the committee chose to stay neutral, citing stable economic growth and inflation that remains under control. In the real estate market, the decision preserves the status quo.

Home loan rates remain unchanged

With the repo rate unchanged, banks are under no immediate pressure to revise home loan rates. Most lenders have already transmitted the rate cut announced in December 2025, and EMIs for existing borrowers are unlikely to change in the near term.

For buyers planning purchases, the decision offers cost certainty. Market participants say predictability in loan outgo often matters more than marginal rate tweaks when buyers commit to long-term investments such as housing.

Developers and brokers add that visibility on borrowing costs helps sustain buyer confidence, particularly in mid-income and premium segments where affordability planning is critical.

Growth outlook remains supportive

The RBI said domestic inflation and growth conditions remain positive, even as global uncertainties have increased since the previous review. The central bank added that earlier policy actions are still working through the system, and maintaining the current RBI repo rate allows time to assess their full impact on economic activity.

The central bank also revised up real GDP growth projections for the first two quarters of FY27, reinforcing confidence around income stability and employment prospects. This matters directly for housing demand, especially in mid-income and premium segments.

Boost for REITs and institutional funding

One policy signal that stands out for property investors is the RBI’s decision to allow banks to lend to REITs, subject to safeguards. This could improve access to funding for income-generating commercial assets over time.

Institutional investors tracking office and warehousing assets are expected to read this as a supportive step, even as global capital flows remain cautious.

Liquidity support adds comfort

System liquidity remains in surplus, with daily levels hovering around ₹75,000 crore, according to RBI data. The central bank said it will maintain liquidity measures to ensure funds are available for productive use across sectors such as housing and infrastructure.

For real estate developers, particularly those running live projects, stable liquidity conditions ease refinancing pressure and allow better control over cash flow planning.

Inflation outlook remains steady

Retail inflation for FY26 is projected at 2.1%, allowing the central bank to remain measured in its further policy moves. The RBI acknowledged external uncertainties but said domestic inflation and growth signals remain favourable.

For homebuyers, low inflation, along with a stable RBI repo rate, helps keep borrowing costs predictable, reducing the risk of sudden EMI changes seen during earlier phases of the recent repo rate cycle.

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