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Impact of demonetization on the real estate sector: Can you buy an apartment in Delhi?

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The impact of the current developments, in terms of the Modi government’s demonetization move and Trump’s victory, on the real estate sector, cannot be determined at such an early stage, however, based on a few general assumptions and expected reactions, it can somewhat be ascertained.
demonetizationB.Kaur

With the ₹500 and ₹1000 notes being reduced to ashes, the real estate sector has infact experienced a huge blow overnight. The real estate sector was considered as one of the key saviors of undeclared and black money, acting as a safe harbor to keep one’s cash intact. With such a tumultuous situation gaining ground, wherein lies the feasibility of buying and owning an apartment in Delhi? Here’s a better insight into the situation and the overall impact that lies ahead.

The residential real estate segment will see a limited impact on business, especially in the metro cities, like Delhi, while it might not be the same for the tier II and tier III cities where the impact of the blow may turn out to be the most as cash plays a major involvement in the business conducted there. While the primary residential market will remain as is, the resale market may have to bear the brunt. In short, the demonetization has spelt good news for home buyers and reputed developers. It will bring in the kind of transparency which is critically required by the sector in order to restore confidence in the home-buyers. Reputed developers would not be troubled at all as they generally resort to bank transactions and cheques. Buying an apartment in Delhi during such times may see lesser costs involved and the movement towards reasonable pricing.

However, it’s not the same case if you plan on buying a luxury or ultra-luxury property. Luxury properties may bear unimaginable price tags in Delhi and its surrounding regions. Only the budget and affordable homes which bear a price of 50 lakhs and below will be able to survive the trauma as the demand for these continues to augment thereby, attracting more buyers. Not many developers will be ready to sell properties at exorbitant or extravagant prices even in the most posh and affluent of all areas in Delhi as demonetization will have the best of them through bringing down the prices that they are willing to offer for the affordable property in question.

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