The Central government’s demonetization move has proved to be a severe blow for the already ailing real estate sector in the state.
Not just the realtors and builders but property buyers as well are in a grip of panic after big notes were scrapped. The adverse effect is already being reflected on the income of Telangana Registrations department.
A week after demonetisation, income from property registrations in Telangana has decreased by a shocking 40 per cent.
While on an average income from registrations stands at Rs 15 crore per day in TS, post demonetisation, on an average Rs 8 crore was earned per day. The department has registered a business of only Rs 67 crore till Friday.
Situation, however, was better on Saturday as Registration department announced that old notes would be accepted towards payment of stamp duty and registration fee till Nov 24.
“Even the property registrations today are mostly the ones which were closed earlier.”
“We fear that this might further go down in the future, as everyone is apprehensive,” opined a senior official from the department.
As most of the transactions in realty sector are done through cash and mostly go unaccounted for, realty sector insiders expect a slump in the sector for the next six months.
However, many also opine that the sector may see a correction in prices and get more organised.
“In case of real estate and construction sector, both accounted and unaccounted money co-exist.”
“Along side law abiding and tax paying builders and realtors, also exist fly-by-night operators who use the sector to make quick bucks, mostly in unaccounted way.”
“Though initially there might be a slump, in the long run it is good for sector,” said Gummi Rami Reddy, president Confederation of Real Estate Developers Associations of India (CREDAI), Hyderabad chapter.