Demonetisation Stalls Property Investments: Report

  Author: Jai Prakash

The most prominent developments things that happened in the aftermath of government’s demonetization of Rs 500 and Rs 1,000 notes in November, 2016 were long queues at bank branches and ATMs. But everyone knew that apart from the immediate pains there was one area where there would be a major impact—real estate. Now, that expectation has got borne out by facts from a report real estate consulting firm, Knight Frank.

For the period of July-December 2016, for residential and office properties, the impact of demonetisation has been quite severe, especially on the residential real estate market. The third quarter of 2016 began on a positive note with sales of 68,734 sold. This was more than that of the average in the last 10 quarters. But in the last quarter, thanks to demonetisation, sales across all cities came down to 40,936, a fall of 40%. The number of new launches also came down to 24,316, compared to 44, 385 in the third quarter, a fall of 45%.