N Ramaswamy, Inspector General of Controller of Stamp and Registration, recently said that about 5,300 documents used to come for registration on a daily basis. This had come down to around 3,500 after the announcement, a decline of 35 per cent in Mumbai alone. Registration of property, land and leave and licence agreements are also heading south even though most real estate transactions have moved online.
According to a PropEquity report in the aftermath of demonetisation impact on the real estate sector, market value of residential property of ₹8 lakh crore is expected to be wiped off in the next 6-12 months. PropEquity research said residential real estate valuation in the top 42 cities in India, sold and unsold, will take a tumble and fall up to 30 per cent from ₹39,55,044 crore by approximately ₹8,02,874 crore to ₹31,52,170 crore.
“We expect lot of secondary market transactions (resales) coming down in volume. For every five buyers out there, there is only one buyer willing to pay all-cheque. And usually, people want to take at least 20-30 per cent of the amount in cash, but this will now go away for the time being. There will be almost a complete stop in resales in the coming weeks as this move will take sometime for real estate sector to absorb,” said Samir Jasuja, CEO, PropEquity.
Ashwinder Raj Singh, CEO – Residential Services, JLL India, said: “Demonetisation is likely to result in luxury property prices dipping by as much as 25-30 per cent as sellers struggle to offload properties to generate liquidity.”
Real estate body CREDAI expects the mop-up of black money will also lead to higher tax collection and a lower rate of personal and corporate income tax from the next financial year onwards.
Interestingly, CREDAI has sets up community kitchen nationally to feed construction workers on-site to battle demonetisation impact. Developers are also providing price protection assurance and also schemes to boost sales. Players such as Lodha, Tata and Runwal Group have undertaken such schemes to boost sales.
Credits The Hindu Business Line