Jolt to the real estate sector -currency ban impact

There is a lot of discussion about the real estate business and the ban of currency in the country. Experts are of the opinion that the realty sector will go into sleep mode for some time and then will be on the recovery path. For some period the , property sales will freeze. Then the dust will settle. Be it land, primary apartments or secondary sales. The psychological blow is a big one. The realtors said that while there will be a change in dealings within the real estate sector, the move will not necessarily end cash-based transactions.

“The real estate is already facing a crisis, in Hyderabad , RR district and some other places , this move will definitely jolt the sector,” .As of now the buyers and the sellers want to wait and watch.

However, some of them stated that this move will not affect black market transactions in the sector. “It won’t be stopped; it will be just replaced with the new currency notes. The withdrawal limit is temporary. Eventually there will be no limit.

Whatever liquid cash can be changed will be used again for illegal dealings. I don’t see how this move can curb black money in the real estate sector,” said a realtor from Hyderabad.

The real estate brokers said that “While cash transactions will continue, the move will give a hard time to brokers and real estate agents.”

Sellers waiting on the side lines will now see the writing on the wall. With black money sucked out, there is very little hope of prices climbing up soon. So desperation will creep in and with it, prices will drop.

Prepare for the largest blow to be felt in luxury and ultra-luxury properties. In cities like Hyderabad and Pune, this could mean a price tag of a crore, in Gurgaon, 2-crore plus and 3-crore plus for Mumbai.

Cities like Lucknow, Jaipur, Surat, Rajkot and Madurai will melt. There’s no way out.

And if anyone will brave the tsunami, it’s the budget and affordable homes priced at 50 lakhs and below. There is enough pent up demand for these. Every correction will bring in new buyers.

The good news is that once the shakeout happens and black money is drawn out of the system, right-priced homes will be built for those who want to live in them.

But there are sellers who would like to take double the price in the form of banned currency and sell the property.