New Delhi, Dec 7 : The continuous rate hikes may lead to short-term impact in the overall housing demand when buyers are optimistic of making a home purchase decision and this may add to buyers' overall acquisition cost. The real estate sector had started seeing gradual recovery across key property markets, driven primarily by end-users, however, the repeated rate hikes may impact the interest rate-sensitive sector. Industry experts claimed that low interest rates have been one of the major factors in the resurgence of real estate demand in the last few years and hence the rate hike would mean a hurdle in affordability. "There is a positive sentiment, as affordability and disposable incomes of new-age homebuyers are much better than in the past. Despite the odds, we're still hopeful as there is significant pent-up demand from a very large population base and first-time home buyers. Real estate is definitely among the best instruments to invest in and looking ahead, we do believe that markets will see sustained growth over the next few years, said ARamani Sastri - Chairman & MD, Sterling Developers. Anuj Puri, Chairman - ANAROCK Group said that the 35 BPS rate hike by the RBI - the fifth consecutive rate hike this year - comes as no surprise. With repo rates now at 6.25 per cent, there may be some repercussions on housing uptake. "This hike will undoubtedly push up home loan interest rates, which had already crept up after four consecutive rate hikes this year. However, as long as interest rates remain in single digits (mainly within 9.5 per cent) the impact on housing will at best be moderate. If they breach this point, we will see some real pressure on residential sales volumes in the months to come - especially in the affordable and lower mid-range housing segments," he added. That said, it bears noting that the Indian housing market remains largely end-user driven. Unlike investors, end-users do not look for the lowest entry point but for the inherent value and benefits of homeownership. As long as end-users continue to significantly outnumber investors, interest rate-driven impacts on housing sales will not be very pronounced, Puri added. "A change in lifestyle is driving demand for premium properties. We don't see a significant impact on the luxury housing segments due to the current increase in repo rate hike as the demand of home buyers in this segment is beyond these considerations. While there has been a moderate hike in loan rates, the affordability of the home loan is still very good. We believe the positive sentiment will continue in the luxury segment driven by changes in buying patterns post the pandemic. However, a reduction in the key rates going forward would be widely celebrated as low interest rates have been a crucial factor in the revival of overall real estate demand and improvement in the liquidity situation which is vital for the sector," said Lincoln Bennet Rodrigues, Chairman & Founder, the Bennet and Bernard Company, known for luxury themed homes in Goa. /IANS