Prices of new and resale properties are likely to fall by upto 50% following #CashCrunch in India as realty transactions mostly involve cash payments. Real estate in India will be affected by demonetisation as it remains the den of black marketers and launderers with very little legal banking / financing records. The branded market formed by projects of few well-connected and credible developers may remain somewhat unaffected, who do not need mentions anyway.
With disposable black money to support property buying, demand for housing can fall and so are prices / quantity of new units. Some honest, educated and hard-working people may participate; the sector can become more efficient, productivity increase, supply shifts out, prices fall, and quantity rises to support #HousingForAll #SmartCity – the affect on quality of homes & deteriorating environment is anyone’s guess. Practical excuse: No pain, no gain.
Real Estate Act 2016, the Benami Transactions Act and demonetisation may ensure to clean some taint and move to transparency. Indian real estate sector can only emerge stronger if the real political and land mafia (not guinea pig activists) are also wiped out or quarantined with even greater enthusiasm. Else the chaos and exploitation of the commoners, as well as rise in prices, can only benefit tipped landlord big-shots cum instigator cronies at the expense of the poor spectators in millions.
The urban rural landless are 400 million plus in India. More equitable access to land and resources could lift millions out of extreme poverty, stopped being forced off their land to make way for mining, industrial development, power plants, wildlife sanctuaries and other interests supposed to bring benefits like electricity, improved infrastructure, tourism and jobs. In reality, such promises and stunts are mostly made for vote benefits of existing ruling elite, thereby severely corroding the foundation of world’s most populous emerging democracy.