Six months into his profession, Deep Jagasia, a property broker in Worli area of Mumbai who deals with resale of premium and luxury apartments, says he will have to search for a new job after the ban on high value currency notes. “Enquiries have completely dried up. Don’t know what to do,” he says. Many of colleagues told him to go to native towns, take a break and come back after two years.
“Since cash component is high in luxury apartments, both buyers and sellers are on hold,” he says. After 10 days of government banning high value notes, the resale market of luxury properties, where the cash component is high, has come to a standstill as buyers are stuck with their notes and sellers not in a position to use them. Anything between Rs 5 crore to Rs 10 crore is considered premium and apartments priced above Rs 10 crore are considered luxury in cities such as Mumbai and Delhi NCR.
Mumbai’s Altamount Road, Napean Sea Road, Worli, Prabhadevi, Bandra (W), Juhu, Khar and other areas house luxury properties and home to ultra rich people like diamond merchants, CEOs, movie stars. Suresh Patel, another broker who operate in South Mumbai says buyers are in wait and watch mode. “.. the move (demonetisation) has hit this market badly,” he says, adding that luxury market is already impacted after the move that buyer need to mandatorily quote PAN numbers in high value transactions.
Patel says brokers like him now only will live on rental deals. The brokers take one month rent as commission in such deals or one per cent of agreement value in sale transaction as their commission. Though recent reports said that prices of luxury apartments would fall by 25 to 30 per cent, Vinod Thakur, a prominent broker from BKC area says that prices are unlikely to fall. “The luxury apartments are owned by very wealthy people and they are not in a hurry to sell,” he says. “They will hold on to prices,” he says.
Credits Business Standard