Builders see No Rush As Cash At Play Is a Small Amount Now
However, it is unlikely that sales momentum will be significantly affected solely due to this change, as many developers are already inclined to avoid transactions involving substantial cash components. The Reserve Bank of India’s decision to phase out the Rs 2,000 currency bill could potentially have a moderate impact on high-value property transactions, say experts. However, it is unlikely that sales momentum will be significantly affected solely due to this change, as many developers are already inclined to avoid transactions involving substantial cash components. Land transactions, especially in small towns and peripheral areas of large cities, may witness some uptick, as suggested by a marginal rise in inquiries for the same so far, the experts said. The liquidity scenario for real estate developers has improved a lot owing to a sharp recovery in sales momentum post-Covid-19 pandemic. Many of them are not showing any keenness towards deals involving large cash, especially after the last demonetization, fearing action from authorities,” said a property broker operating in central Mumbai. Following the demonetization in 2016, the cash component in real estate deals has come down across key property markets, and several developers have intimated to their channel partners not to encourage transactions involving large cash dealings.
One of the Biggest Deterrents Has Been The Gap Between The Tates,
which has been narrowing further in many micro-markets, allowing less room to accommodate cash in property deals,” said a Pune-based realtor. The high-denomination currency in circulation is around 10% this time, as compared to the 2016 demonetization when Rs 500 and Rs 1,000 notes, which were banned overnight, formed over 85% of the currency in circulation. The cash circulation is significantly lower and may not see a rush like in 2016. There have been queries for residential assets and land-related transactions, but builders are also cautious, as most have had ED and IT raids said the CEO of a Bengaluru-based broking firm. “In a bid to get rid of cash, some developers themselves are offering to pay in cash to brokers to settle duesThe real estate markets have been thriving for the past two years. While the new residential sales are not seeing a major impact, many clients with pending payments are insisting on paying in cash, said industry insiders. In Gurgaon, Noida, and Delhi, people are trying to use Rs 2,000 currency notes in secondary transactions, as the builder is not accepting too much cash.
Those who had pending payments are trying to pay in advance to get rid of the notes. Before this directive, developers were ready to take cash, but now they are not accepting more than 30% of the balance or pending amount of Rs 2,000 notes,” said a Noida-based realtor.