Centre's move to impact realty business
Mr Singh believes that a lot of investors who have been investing in projects with unaccounted-for money.
The demonistisation exercise being carried out by the government is set to impact the secondary sales market and luxury high-end segments in the residential real estate sector in the coming days as the cash component have traditionally been higher in these areas.
According to property consultant JLL India, the primary market in top cities, which is characterised by first time buyers, are expected to remain more or less unaffected.
“The legal banking/ financing channels have accounted for only a small part of all transactions in this space. The demonetization move 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.
“This means that luxury home buyers will suddenly have a much wider bandwidth of options to choose from,” said Ashwinder Raj Singh, CEO, residential services, JLL India.
With black money suddenly being wiped out of the market, Mr Singh believes that a lot of investors who have been investing in projects with unaccounted-for money — and raising prices to book profits — will get eliminated, thereby aiding a much-needed correction in the prices.