All hell broke loose when PM Narendra Modi addressed the nation and announced that Government has decided to scrap Rs 500 & Rs 1,000, country-wide, effective from mid-night, November 8th. There was chaos all around with people frantically queuing up in-front of the ATMs to withdraw and deposit cash before the currency notes of Rs. 500 & Rs. 1000 turn into worthless pieces of papers. Long queues were noticed at the petrol pumps as well where people tried to make use of their 500 & 1000 rupees notes, for one last time! A ‘decisive war against the menace of corruption, black money and terrorism’ was set…
Unorganized builders and secondary realty market are expected to be impacted harder as compared to organized real estate businesses following Modi’s historic decision of scrapping Rs 500 & Rs 1,000 notes, yesterday evening - Bankers and Economists believe.
Unorganized real estate sector would surely feel the heat as it is one of the most preferred investment options favored by individuals to salt away their black money. A large number of real estate transactions are not reported on account of high property transaction taxes.
The real estate sector in India contributes about 11 percent of the gross domestic product (GDP) and a considerably large percentage of India’s black money transactions are believed to be in real estate industry.
However, the larger sentiment in the organized real estate sector is not dim and in sync with the positive surge of reactions from the tax-payers and common men across the country. Modi’s masterstroke to curb black money, corruption and terrorism has been welcomed with all heart by the section of real estate players who already have moved towards authorized transactions using bank channels and for this section it’s a positive move towards a matured economy.
This move is expected to affect property price and may push it down as investors will now fail to park their cash in property investments, which may cause a dip in the price. Real estate market is expected to experience substantial price correction on account of reduced land price as well.
It will not be wrong to say that be it’s a hearty and progressive step towards a better India and will neither affect a clean developer nor an honest buyer, the move will only benefit them.
Cheers to a brighter and transparent real estate world!