Affordable housing demand to remain low as home loan rates rise: Experts

Some believe the impact of the interest rate hike has been limited and would not dampen homebuyers' spirit much, as demand remains high

With the hike in repo rates, the affordable housing segment, which was already reeling under inflationary pressure, is set to face another challenge as interest on home loans will rise and homebuyers might face affordability issues, say industry experts.

The Central bank hiked the repo rate for the sixth time in a row, by 25 bps to 6.5 per cent on Wednesday. This hike will translate into higher equated monthly instalments (EMIs) on new home loans. With the cost of funding rising continuously, most banks and housing finance companies are expected to increase home loan rates.

For existing borrowers, the