Good News for Developers / builder - Impact of Currency Change of Real Estate

Good News for Developers / builder - Impact of Currency Change of Real Estate

Good News For Developers / Builders & End Users

Primary Market Real Estate Vs Secondary Real Estate Market (Resale)

Primary Market (New Property)

  • ·Primary Real Estate Market will have Positive Impact and likely to grow by 15-20% in coming year 2017 due to low in interest rates of home loans. The end user who wanted to buy new property directly from builder and can only pay considration money in white either from self-funding or through bank loan will get benefited as currently market touching on its low points. Real estate market is already undervalued and giving opportunity of buying as it exist 90% of end user who are looking to buy for their own stay or end use of the property. It is right time to buy property rather then sell. As there is no cash transaction is happening in real estate and no seller is accepting cash or white. 

Under this scenario Builders/ Developer selling less than 1cr properties getting huge benefit due to the client shift from resale market to primary market. The sales number are more or stable in primary market and expected to grow month on month.

Secondary Market ( Resale Properties)

·         Secondary Real Estate Market also known as resale market where the huge cash is involved. Normally people use to buy property on prevailing circle rate decided by the govt. time to time which is usually low as compare to market selling rates. Due to demonetisation and currency change of Rs.500 and Rs. 1000 Notes, sellers either not able to take cash while selling their properties nor able to take 100% through bank loan or white. If they take 100% property value in white then they have to pay capital gain tax which is close to 25% on the profit / premium. 

This impacted badly in secondary / resale market. No Transaction is happening in resale market. Under this senario developers / builders having clean track record getting benifit as end users are moving from secondary market to Primary market for buying, which leads to boost on primary market. 

Conclusion:  Primary Market is expected to Grow by 15-20% . Source : CREDAI & Zee News



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