India's Housing Market Heads Into Festive Season With One Big Question: Will RBI Hike?
India enters its busiest property-buying window just as the Reserve Bank of India prepares for its October 5-7 policy meeting, with the decision due October 7. The repo rate is 5.25%, retail inflation is 4.82%, and the rupee has weakened.
The market they are walking into
- Sales: 100,220 units in Q3 across the top seven cities, up 3% year on year (Anarock)
- Launches: about 114,320 units, up 18%
- Prices: up 7% year on year to about Rs 9,714 per sq ft; NCR led at 12% and Bengaluru followed at 8%
- Unsold stock: about 6.3 lakh units
- Weak spots: Chennai sales fell 10% and Kolkata fell 4%
Premium buyers are driving demand
Anarock data shows homes priced above Rs 1.5 crore accounted for 27% of demand in H1 2026, up from 13% in H1 2021. Knight Frank India's Vivek Rathi expects country-level festive sales to beat last year, though growth is likely to moderate. Anarock's Anuj Puri has said buyers are becoming more selective as prices rise.
Why the RBI matters now
Analysts say price-sensitive buyers are the most likely to pause if borrowing costs rise. On a Rs 50 lakh, 20-year loan at an assumed 8.5%, a 25 bps hike would add roughly Rs 790 a month to the EMI (our illustrative calculation). Economists are not unanimous on a hike, and the result is unknown until October 7.
What buyers should do
Check whether your loan is repo-linked, compare festive offers carefully, and avoid stretching your EMI budget before the RBI speaks.