The authorities had said that it would be ‘Ache Din’ for the real estate market segment as there would be an extensive fall in the home, land, apartment prices over the next few months. The cost could undertake a correction in the market and secondary, or resale market extremely soon. There would not be greatly price changes happening in the reasonable segment. The land prices are estimated to fall, which will push demand in the marketplace.
Talking to the real estate agent and real estate seller, we found out that they were unwilling to take cash these days after demonetize. Earlier, the hard cash was the main through which real estate purchasing and selling of properties were handled. The real estate market situation had changed after the PM Narendra Modi broadcasted the clamp down on the black wealth. Following the judgment of the government on demonetization of Rs 500 & Rs 1,000, the whole real estate industry was affected, as there was usually connection of black money and the hard cash.
Opportunity in the new property sector
New residential assets will see lower demand due to unhelpful market response & apparent uncertainty Builders will face a money crunch due to an unexpected drop in sales. But they will be willing to bargain on prices with serious buyers across the board & offer extensive value for the similar price. If you are salaried / self employed and looking to purchase your first house, next 6 months is a superb opportunity to save a huge amount.
Opportunity in resale property & land
- Opportunity in resale assets & the land Resale segment will see a direct crash from demonetization since cash module plays a big role in these dealings.
- While there is not going to be much of a crash on the main residential market, where houses are bought in the form of bank loans & mortgage; there is going to be a visible crash in dealings which deal in cash.
- Generally, the residential market might witness drop in prices, correcting to a standard of 10 to 20 percent
Demonetization has sucked out most of the unaccounted money from the system. Rich buyers who could pay cash & purchase are out of the marketplace. Provisionally! This leaves just the end users with enough loan eligibility in the marketplace. Lower demand would mean strain on sellers to reduce cost Sellers with instant need of cash will go for a distress sale & be prepared to sell off at a lesser price. If you get hold of such a contract in the next 6 months, you will reap the loot in the extended term
In previous 4 years, property prices have raised at a lesser speed than inflation which means properties are previously being sold currently at 2012 cost (price adjusted for increase) Most builders have obtain lands at higher costs, input costs of building have gone up in the previous few years Through around the corner, builders will be necessary to comply & cost of fulfillment will squeeze limits further An open price drop will also crash builder’s trustworthiness with past & existing clients & most builders would not run that possibility in its place, builders will be willing to bargain on prices with serious buyers across the table & offer significant giveaway in form of modular kitchen, free car park etc.
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