Realty stocks traded flat after RBI’s surprise 50 bps rate cut; here’s why

After a blockbuster rally last week, real estate stocks cooled off on Monday, June 9, as investors booked profits following the Reserve Bank of India’s (RBI) larger-than-expected 50 basis point repo rate cut. While the move is expected to boost housing demand, the Nifty Realty index edged marginally lower to around 1,038 levels, snapping a two-day winning streak.

Investors book gains after sharp rally post policy boost

The Nifty Realty index had surged nearly 4.7 per cent on June 6 to close at 1,039.60 after RBI Governor Sanjay Malhotra-led Monetary Policy Committee announced a 50 bps rate cut, double the consensus estimate of 25 bps. The unexpected easing had lifted sentiment sharply on Friday, pushing realty stocks to new highs.

However, on Monday, the index saw mild pressure as short-term traders opted to cash in on the recent gains. Stocks like Prestige Estates and Brigade Enterprises slipped over 1 per cent, while Oberoi Realty dropped around 0.8 per cent. DLF, Godrej Properties and Macrotech Developers (Lodha) also saw minor losses.

Why the muted reaction despite a rate cut?

While the 50 bps repo rate cut takes the benchmark rate to 5.5 per cent and is seen as a tailwind for housing demand, analysts note that much of the optimism was already priced in last week. Moreover, global market uncertainty and a cautious tone among institutional investors ahead of inflation data have capped aggressive buying.

JM Financial, in its latest real estate sector note, said, “The cumulative 100 bps cut since February 2025 significantly improves housing affordability. For a Rs 1 crore home loan, tenure reduces by nearly 3 years at the same EMI, or eligibility increases by Rs 15 lakh, a game changer for mid-income and affordable housing.”

Market Outlook

Amid the overall subdued tone, Anant Raj shares gained over 2 per cent, while Sobha, Raymond, and Phoenix Mills managed marginal gains. Experts believe select quality names in residential and commercial realty may continue to attract investor interest on every dip.

While Monday saw some cooling off, the medium-term outlook for real estate remains bullish, say analysts, especially if the current rate cycle sustains.