The cash crunch is likely to bring down the real estate market but its impact will be for short term duration. But when we talk about its future aspect it will surely bring stability.
Real estate sector functions and performance is asymmetrical as when we talk about metro cities, small cities, and towns. Accordingly, the impact of “Demonetization” will also be different.
One of the major scourges in realty sector is the menace of Black Money. Due to this bold step of “Demonetization” taken by the government, it will help in curbing this issue and it will also bring clarity in secondary money, as there is lots of involvement of secondary money during transactions.
This measure taken by the government will completely bring transparency as denominations of Rs. 500 and Rs. 1000 currency notes were mostly used in cash transactions.
Demonetization is largely beneficial for consumer as prices are at their best at this time. It’s a good time to buy properties but not for developers, still it will be impacted for short term. Also, modification in real estate prices will put pressure on the financial position and prospects of real estate developers.
However, this will lead to enter in the new era as like fair competition, more solidity, smart dealing and more predictable business scenario with right-mindedness. There will more new affordable and efficient construction techniques will also evolve.