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Repo rate cut boosts home savings in Kolkata

RBI’s Repo Rate Cut Brings Huge Savings on Home Purchases in Kolkata

Homebuyers especially in Kolkata have great news, thanks to the RBI repo rate cut. The Reserve Bank of India’s Monetary Policy Committee (MPC) increased the repo rate cut by 25 basis points, which brought the repo rate all the way down to 6.25%. This move comes after nearly five years and is sure to relieve the financial burden on potential homebuyers, as paying off home loans is now more manageable.

The lending firms have already begun slashing their interest rates, with State Bank of India (SBI) spearheading the movement. More banks are anticipated to join the bandwagon as well. Together with the Union Budget impact on housing, which came with tax cuts for the meagerly paid, the demand for Real Estate in Kolkata is on the rise, particularly in the low-cost housing market.

Why the RBI Repo Rate Cut Matters for Homebuyers?

The repo rate, also known as the repurchase option, is the rate of interest charged on a repo transaction, which is the amount of money the Reserve Bank of India dispenses to commercial banks. This amount is charged for lending home loans, which, following the repo rate decrease, can subsequently be fetched at reduced premiums and EMIs (Equated Monthly Installments). For home buyers across Kolkata, this means an amazing opportunity for real estate investment from a financial standpoint.

How Does the Repo Rate Cut Impact Your EMI?

Reduce in interest charges typically translates to reduced EMIs, translating into substantial savings over the loan tenure.

Let’s break this down with an example:

  • Suppose you take a home loan of ₹50 lakh for a period of 30 years with an interest rate of 8.5%.
  • Your EMI would be approximately ₹38,500 per month.
  • If the RBI repo rate cut leads to a 0.5% reduction in the home loan interest rate, bringing it down to 8%, your EMI would drop to ₹36,700 per month.
  • Over 30 years, this single adjustment is bound to help you save nearly ₹4.2 lakh.

Instead of squandering that cash elsewhere, it can be put towards other financial investments, helping pay the home loan back faster and reducing the duration for which the loan was borrowed.

The Union Budget Impact on Housing

The latest Union Budget impact on housing has added additional benefits for various classes in terms of housing. One of the key takeaways is the zero income tax for individuals earning up to ₹12 lakh annually. Therefore, purchasing a house is considerably easier for middle-income earners now, as they have more disposable income at hand.

Moreover, the government’s continued focus towards affordable housing through subsidies and incentives is likely to stimulate investment in real estate further. With the combination of tax relief and reduced home loan rates, prospective investors in the real estate industry in Kolkata will be pleased to learn that now is the perfect moment to buy.

Actionable Tips to Maximize Your Savings

With the RBI repo rate cut and the Union Budget impact on housing, this is an opportune moment for homebuyers. Here’s how you can make the most of this scenario:

1. Consider Refinancing Your Existing Home Loan

If you are currently paying off a home loan that comes with a high rate of interest, it might be best to refinance said loan. With many banks actively competing for new customers, changing to one that has a lower rate is likely to increase your savings.

2. Choose Between Lower EMIs or Shorter Loan Tenure

When home loan interest rates drop, you have two choices:

  • Lower your EMI and keep the same tenure. This increases your monthly savings.
  • Keep the EMI constant but reduce the loan tenure. This helps you repay your home loan faster and save on interest costs.

3. Compare Home Loan Offers from Different Banks

Not all banks reduce their interest rates at the same pace. Compare offers from different lenders to get the best deal on your home loan.

4. Increase Your Home Loan Prepayments

With the reduced EMI burden, consider making extra payments towards your principal. Even one or two extra payments per year can help you clear your loan much faster.

5. Invest in Affordable Housing

With multiple government incentives and lower interest rates, now is the best time to buy a home in the affordable housing segment. Developers in Kolkata are offering lucrative deals, making it an attractive market for buyers.

Know more: The Role of RERA in Secure Flat Purchases in Kolkata

Where to Buy a Home in Kolkata?

Kolkata’s real estate market is witnessing a surge in interest due to the repo rate cut and budget benefits. Some of the best locations to consider for home buying include:

Check this out: How to Spot a High-Growth Area for Real Estate Investment

Looking for a Reliable Developer? Choose Sugam Homes

If you want to bolster your business in Kolkata, one of the most important factors to consider is choosing a trustworthy real estate developer. One such name is Sugam Homes, the best real estate company in Kolkata with:

  • More than 3.5 decades of experience
  • More than 25 projects completed successfully
  • Over 7000 satisfied clients
  • 30+ prestigious awards

With a vision to promote a sustainable environment, we are focused on building modern living spaces complete with eco-friendly features. Their projects aim at perfecting the balance between luxury and affordability in an urban setting.

Suhel Saraf on the RBI Repo Rate Cut’s Impact on Homebuyers

Suhel Saraf, Managing Director of Sugam Homes, remarked, “For buyers of homes, the cut in the RBI’s repo rate is a breath of fresh air. There is greater accessibility towards home buying, especially for first-time buyers. Affordability is at its peak, and it is a perfect time to purchase fine-quality homes in Kolkata.”

Final Thoughts

The RBI repo rate cut has paved the way for affordable home loans and significant savings, making it an excellent time to invest in real estate in Kolkata. Combined with the Union Budget impact on housing, homebuyers now have multiple financial advantages at their disposal.

Whether you are a first-time homebuyer or looking to refinance an existing loan, taking advantage of the current market conditions can help you secure substantial financial benefits in the long run. Connect with reputed developers like Sugam Homes to make an informed and rewarding home-buying decision.

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