RBI rate cuts lower mortgage costs but Mumbai and NCR still face housing affordability squeeze

The Reserve Bank of India's 125 basis-point repo rate cut during the first half of 2026 has reduced borrowing costs for home buyers, according to a new NBR Group analysis. Yet the benefit is uneven, as Mumbai and the National Capital Region have seen residential prices climb as much as 19% compared with the previous year. In contrast, Delhi-NCR's housing market has expanded rapidly, with new residential launches rising 39%, driven by infrastructure-focused development corridors.

Bengaluru leads the country with more than 25,000 new projects in the same period, concentrated in its southern and eastern growth zones. The report argues that while cheaper loans can stimulate demand, they are insufficient to overcome persistent affordability challenges that differ across cities. It also points to a maturing Indian real-estate sector where local market dynamics now outweigh national trends.