Repo rate unchanged: Why unchanged EMIs are not bad news for homebuyers

The Reserve Bank of India has kept the repo rate unchanged at 5.25%. This means home loan interest rates are unlikely to move in the near term, and monthly EMIs for borrowers will remain the same.

While many homebuyers were hoping for a rate cut, the RBI decision to keep rates steady at 5.25% is not bad news, especially for those who value stability and clear planning.

For existing borrowers, the biggest relief is that there will be no sudden increase in EMIs. Households that are already managing tight monthly budgets can continue with their current repayment plans without worry.

WHY RBI HOLDING REPO RATE IS A WIN FOR HOMEBUYERS

For new buyers, unchanged rates bring predictability. They know what their loan outgo will look like over the next few months, which helps in making long-term decisions such as buying a first home or upgrading to a larger one.

According to Anuj Puri, Chairman of ANAROCK Group, the status quo offers comfort but limited support to demand.

“RBI's decision to keep the repo rate at 5.25% means that home loan EMIs will not change either. This will keep buyers engaged,” he said.
However, he added that it does little to push demand higher or make homes more affordable.

“The upside is that current home loan borrowers will not experience any EMI shocks for now, and new borrowers can plan their housing purchases with the benefit of predictability.”

Puri pointed out that demand for affordable and mid-segment homes is still holding up, but higher home prices are making affordability a challenge.

“A rate cut would have potentially brought at least some fence-sitters back to the market,” he said.

Data from ANAROCK Research shows that affordable housing has been under pressure for some time. In 2025, the affordable segment made up only around 18% of total home sales across major cities.

In 2024, when about 4.60 lakh homes were sold in the top seven cities, affordable housing accounted for 20%. This share was much higher in 2019, when 38% of the roughly 2.61 lakh homes sold were in the affordable category.

Puri also flagged the lack of policy support for this segment.

“The Union Budget 2026-27 failed to deliver any notable relief to affordable housing buyers,” he said.

He added that the segment needs strong steps such as tax breaks for both developers and buyers to improve affordability and encourage more supply in this category.

From the developer and industry side, the RBI’s steady stance is being seen as a positive signal.

Manju Yagnik, Vice Chairperson of Nahar Group and Senior Vice President of NAREDCO Maharashtra, said the unchanged repo rate has brought much-needed clarity.

“With the RBI maintaining a status quo on the repo rate at 5.25%, policy continuity has brought stability for home loan borrowers,” she said.

“An unchanged rate has ensured that EMIs on floating-rate loans remain steady, offering predictability at a time when housing demand continues to stay resilient across major urban markets.”

She noted that this stability is especially helpful for first-time buyers, who are often sensitive to changes in borrowing costs.

“This clarity on borrowing costs has supported affordability and enabled homebuyers to plan long-term purchases with greater confidence,” Yagnik said.

From a real estate business point of view, she said a neutral rate environment also helps developers.
“It allows developers to plan financing and project execution more efficiently, without the pressure of fluctuating interest costs,” she said.

Yagnik added that with inflation under control and economic conditions stable, a consistent policy approach helps maintain confidence among buyers and investors.

“This has supported steady momentum in the housing market and should help the sector in the coming quarters,” she said.

For homebuyers, the key takeaway from this RBI decision is stability. EMIs are not coming down, but they are also not going up. In a market where home prices have risen and household expenses remain high, certainty itself carries value.

For many buyers, especially those planning purchases over the next year, unchanged rates may not be exciting news, but they offer breathing space and time to plan carefully.