How Demonetisation crippled India's real estate sector and the difficult job in front of Budget 2017
India's housing market was among one of the sectors that took a big hit when Prime Minister
While it was known that demonetisation would adversely affect the property market, what we weren't aware is the extent of the damage caused.
According to a
Sales volume dropped by 53 percent to 6,765 units in the fourth quarter of 2016 while new launches fell by a massive 73 percent in Delhi NCR.
Knight Frank which tracks the primary housing markets of eight cities -- Delhi-NCR, Mumbai,
Moreover, the report also stated that new home launches fell by 61 percent to 24,316 units in the fourth quarter compared with the year-ago period.
As it turns out, housing sales had gone up in the first nine months of 2016, but 'the government's decision to scrap the Rs 500 and Rs 1,000 notes in early November pulled down the housing sales in the fourth quarter as well as for the entire last year.' This had a domino effect as it led to developers refraining from announcing any new launches and buyers were extremely cautious before buying anything.
This resulted in the launches and sales of
Additionally, the report also estimated that Demonetisation had contributed to the state government's notional loss on stamp duty at Rs 1,200 crore.
To summarise, the