Newspapers are flooded with reports of how there are mile long queues outside banks and the frustration levels of the general public is increasing every day. For any great change to get acceptance, there are always some hiccups. Once the dust settles, people will realise how it’s not that bad. For the real estate sector, this move does not spell doom, as is the popular perception, even though almost 90% of real estate transactions include some amount of black money.
The real estate sector will finally be moving towards transparency in transactions. The secondary market will bear the biggest impact of this war against black money. The market was already in distress with a massive inventory overhang, and sellers are looking at the liquidation of their inventory at the earliest. This will benefit the consumer as the price for secondary or pre-owned properties are bound to spiral down. This will lead to more aggressive negotiations but also greater scope for transparent transactions.
At DoorKeys, we expect this move to encourage organized and professional developers who are favouring cheque payments to grow further. This sector seems to be on the revival mode, especially with the implementation of RERA that is giving a boost to buyers’ confidence. Buyers also had to face many inconsistencies and unfair trade practices – and now they can expect more professionalism in the sector.
What can the common buyer expect to do in such a situation? As the country moves towards cashless payments, the buyers should move online as well. More than 90% of the research to find a dream home is now happening online. Consumers are comparing prices, checking developer credentials, following project updates and even looking at the past project performances and making sense of the multiple layers of data, online.
To reduce the visits to property dealers and realtors, buyers should try and do all of this online. Instead of haggling over prices, they should look at shifting the entire process online. Making an offer and negotiating online has simplified this task and given it some much-needed transparency. The shift of buyer-seller interactions online is giving more power to the buyers and an opportunity for the seller to gain as per their performance.
Online platforms are bridging gaps between the buyers and the sellers along with providing the much-needed guidance to the buyers. The younger and tech-savvy buyers are seeking information and transparency while dealing with developers that are reeling under the effect of project delays and a sagging property market. Having an interactive and receptive customer service and an active presence on the social media platforms, interactive websites with 3D virtual tours can be leveraged upon to share information about a company’s ongoing and future projects. Industry statistics suggest the growing quantum of real estate related queries is climbing at the rate of 35 per cent year-on-year.
The real estate market in the country has seen a rough patch in the last five years with inventory pileups crossing record numbers. This added with a growing mismatch between the pricing expectation of the buyer and the seller, has created a situation of distress in the market that needs to be addressed for its revival. This scenario is also leading to buyers holding off from putting action to their thought and completing their purchases, adding on to record unsold inventories. According to a recent ASSOCHAM survey, NCR region has the highest unsold inventory pressure among all other cities with the NCR residential market having an estimated 1,70,000 units of unsold inventory, mounting to almost 30 per cent of the units under construction. Verified and analyzed property listings stand a chance of garnering better attention from prospective buyers, making online property negotiations a hit with the masses.
Passing of RERA, the Benami Transactions Act and now this demonetization move is going to make the sector more transparent. Developers/sellers will be forced to be transparent and show some integrity.
So buyers, all hell hasn’t broken loose. You can rest assured that chances of being cheated are going to go down significantly. You will be able to buy a property of your choice and that too at a price that is reasonable to you. When our house gets too dirty, a spring cleaning is necessary. Over the long term, the sector will emerge stronger and sustainable. So there’s no need to panic – neither for developers, investors or buyers. It will essentially be business as usual for them.
Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of the publication