Nifty Realty Index Surges 4.9% As RBI’s Rate Cut Boosts Housing Demand

Image Source : Business Today

India’s Nifty Realty Index extended its gains, rising 4.9 percent in Friday’s trading session, driven by the Reserve Bank of India’s (RBI) unexpected 50-basis-point repo rate cut. The move has fueled optimism in the real estate sector, with major developers witnessing strong buying interest.

Key Highlights Of Nifty Realty’s Rally

The index has gained over 6 percent in the last two trading sessions, adding ₹30,000 crore in market capitalization
Realty stocks surged following the RBI’s third consecutive rate cut in 2025, bringing the total reduction to 100 basis points this year
DLF led the rally, climbing 6.33 percent, followed by Godrej Properties and Prestige Estates Projects, which gained over 5 percent
The rate cut is expected to lower home loan interest rates, improving affordability for buyers and boosting demand

Impact Of RBI’s Rate Cut On Real Estate Stocks

The RBI’s decision to slash the repo rate to 5.5 percent and reduce the cash reserve ratio (CRR) by 100 basis points has injected fresh liquidity into the banking system. Analysts believe this will ease borrowing costs for developers and homebuyers, driving sustained demand across urban and suburban markets.

Sectoral Performance And Market Sentiment

1. *Residential Real Estate* – Lower interest rates are expected to enhance affordability, leading to increased home sales

2. *Commercial Real Estate* – Leasing activity is likely to pick up as businesses capitalize on improved financing conditions

3. *Luxury Housing* – High-end properties may see renewed interest from investors seeking favorable mortgage rates

Future Outlook And Industry Implications

Analysts anticipate continued momentum in real estate stocks as borrowing costs decline
The RBI’s policy shift is expected to drive new project launches and investment inflows into the sector
Market participants will closely monitor transmission speed by lenders to assess the full impact of the rate cut

Sources: Moneycontrol, CNBC-TV18, Zee Business.