Demonetisation impact on real estate sector: PM Narendra Modi’s move of demonetisation has affected the economy in a major way and its repercussions are widespread and are being witnessed in all aspects. The real estate sector has also been affected by demonetisation.
Demonetisation impact on real estate sector – Residential property sector suffer backlash after the scrapping of Rs 500 and Rs 1000 notes
It is believed that the residential property transactions will suffer owing to the financial crunch in the economy. As has already been observed, the business has slowed down to a great extent in this sector after the coming of demonetisation.
The resale of the property will also suffer a backlash. However, some gains are also sought to be availed by the intended buyers of residential property since the interest rates on home loans have reduced and is further expected to reduce.
The leasing out of land will not be affected much and also the joint venture purchases will be only marginally affected. The unorganised sector is deemed to suffer greater backlash than the organised sector since the transaction is predominantly done through cash in the former.
However, it is expected that the situation will bounce back to normal soon after the effects of demonetisation will fade in the first half of next year or else the sellers of land will have to lower the rates of property in order to sustain.