Note ban didn’t have much impact on real estate: Govt

NEW DELHI : Prices of under-construction residential properties in Delhi, its next-door neighbour Faridabad, Patna, Nashik and Chandigarh have witnessed the maximum fall in the first quarter of 2017 over the previous quarter, data released on Monday by the National Housing Bank’s (NHB) Residex revealed.

However, contrary to perception, the government’s demonetisation drive in November last year does not seem to have much of an impact on India’s fastgrowing real estate sector.

In 24 of the 47 cities surveyed, there was an upward movement in prices of residential proper ending December 2016.

The maximum increase was observed in 7 cities -- Jaipur (8.7%) followed by Chennai (6.5%), Lucknow (5.7%), Guwahati (5.2%), Howrah (5.0%), Hyderabad (4.4%) and Bidhannagar (4.1%).

“The price indices for the last quarter of last financial year i.e 2016-17 proved wrong the critics of demonetisation who said that economy will take a hit,” Union housing and Urban affairs minister M Venkaiah Naidu said while releasing the Residex, which tracks home prices.

Minister Naidu said that National Housing Bank also collected data on land prices, which showed that a correction in land prices is taking place which in transactions of unaccounted money. A subsidiary of the Reserve Bank of India, the NHB regulates housing finance companies such as HDFC and LIC Housing Finance.

Of the 47 cities that were surveyed, market prices of underconstruction properties in another 14 cities have also shown a decline over the previous quarter.

The housing sector grew at a compounded rate of 18% to 19% after the government scrapped two high-value banknotes, which accounted for 86% of the cash in circulation.

Cash deals in real estate crimped after the government capped the transaction limit at `2 lakh making it difficult to buy