There has been unwarranted fear mongering in the country post the announcement of demonetisation. However, if we take a long term view on issues, demonetization will help bring a positive change in the real estate sector. While the industry will stand to gain from the shift towards a more transparent and organised environment, there are plenty of reasons for the home buyer to rejoice. This move has placed the consumer in a remarkable position with various factors working in his favour.
Top reasons why property seekers should invest in a property today:
Lower home loans
Demonetisation has increased the flow of money into banks from the unorganised and the small scale industrial sector by compelling these sectors to deposit their savings in banks. It has opened a window of opportunity for everyone to avail home loans at significantly lower rates allowing them to fulfill their dream of owning a home.
The deflationary effect on the economy due to better liquidity will lead to price stabilisation making it a buyer’s market. The Reserve Bank of India will also have ample leg room to bring down the repo rates. Liquidity with the banks will help them translate the repo rate into lower borrowings for home loans. The rupee is also expected to strengthen in the consecutive months thereby increasing the purchasing power of consumers.
Restoring the stalled projects
Projects that were being delayed because of cash crunch, will now pick up speed. The cash flow with banks will also mean that industry can avail loans from banks at better lending rates than what was being offered in the past. This will be a major relief to consumers.
Investment in infrastructural development
Demonetisation will increase the percentage of money being accounted for and will therefore result in a rise in the collection of taxes. The government will have more resources at their exposure to invest in infrastructural development of the country. Providing connectivity to the consumers who have invested in affordable housing projects in town peripheries will gain from the development.
Transparent home buying process
Demonetisation has ushered in a shift to cashless economy. Card transactions are not only beneficial for customers in terms of ease of use and time saving but are also transparent in nature.
While demonetisation has made us all cautious of our spending, it is important that home buyers make the most of this opportunity. Home buyers looking to invest in homes financed by loans should be rest assured that this is the perfect time with all the above reasons placing them at an advantage.
The writer is MD & CEO, Tata Housing Development Company.
Updated Date: Nov 28, 2016 17:28 PM