With the Reserve Bank of India (RBI) improving liquidity in the market, interest rates on home loans are expected to stay low for the next one year and provide the best opportunity for homebuyers to buy homes, a top executive of HDFC Ltd said.

The best rate for a home loan is now at a record low of 6.75%.

"The lower-interest-rate regime will continue for another six to twelve months, which will give the best opportunity to the homebuyer," said HDFC Ltd vice chairman and CEO Keki Mistry at the ongoing virtual NAREDCO's Real Estate and Infrastructure Investors' Summit (REIIS).

"Home loan rates have been the lowest in the last four decades. For the next six to twelve months, the benign interest rates environment will continue. The growth in the economy and the real estate has been sharp. Factors like the RBI infusing much-needed liquidity into the sector, various concessions given by the government and the developers such as stamp duty relaxations have extended the best buying opportunity to the homebuyer," he added.

He added that the RBI may face some pressure owing to the higher inflation, which will reduce its ability to cut the rates further. Banks are now distinguishing between strong and weak developers for lending, which is why improving the quality of balance sheets, avoiding over-leveraging, and staying well-capitalised will help the developers float well in the market. Mistry expects investments in creating co-working spaces to rise as more consolidation happens at the project level.

Mistry also said that all real estate developers may not be able to avail the benefit of RBI's one-time restructuring scheme as they might not meet the required financial ratios and have the necessary credit rating.

The RBI had, in August, allowed one-time restructuring for personal loans and for non-MSME corporate borrowers having aggregate exposure of greater than Rs 25 crore and who were affected by Covid-related stress.

Diwali this year has witnessed a major turnaround for the residential real estate segment by registering a growth of 83% in the number of residential units, and sales value went up by 72% over the last year.

"Residential sales in the July-September quarter is 67% of the Q1 sales of Jan-March 2020, which is a clear indication that the affordable housing segment is back in action," said Anarock Property Consultants founder and chairman Anuj Puri.

"The start of the pandemic saw a few months of zero sales, but soon people realised the value of owning a home, which saw a severe turnaround. The volume will increase in the coming months and we expect the momentum to continue," said K Raheja Corp president Neel Raheja.

"On the commercial front, the new leasing market has been slow due to the uncertainty caused by the pandemic. We are seeing a trend of offices shifting from Nariman Point to BKC; few of the companies are also preferring to move to far-off areas like Navi Mumbai and Thane. Also, 75-80% of the demand for offices is coming from global companies. People cannot continue to work from home for a longer period of time, and we expect the commercial market to be back once things start to move slowly," Raheja added.

"The global interest rates have been low, and global fund managers are bullish on countries like India. Domestic individuals have founded a great investment class, which has created large investment opportunities as a saving instrument," observed Blackstone managing director Vikram Garg.