Why is real estate market still in doldrums?? Many say, it’s because of BJP Government. But is this good or bad?? Let’s find out.
As we all know, property market in India thrives on cash (or unreported income). As long as cash is being pumped into the realty market, it thrives and investors make merry. However, the Narendra Modi government's efforts to uncover black money have reduced the generation of black money in the system. The impact of this change will become more pronounced in the coming months.
"With the new Black Money Bill (which was passed by the Parliament on May 26) and with the Cabinet approving the Benami Transactions Bill in May this year, the crackdown on Black Money will continue further.
All these steps by the Narendra Modi government have impacted the realty market in short term; however, it's a step in right direction (if we look at the long term prospects).
For too many years, people avoided taxes and pumped that cash into realty market. Consequences of such theft (avoidance of tax) meant property prices were shooting (almost doubling in 2 years). People parked their unreported income into real estate. Some bought 8 flats, some bought 15 plots. It was crazy. Real estate became the best asset class to make money in short period of time.
However, working class (or salaried class) was suffering because of high values of real estate. They could not buy their dream home. Their dreams of owning a home was fading, slowly but surely. Congress party did nothing to stop this mad rush to own the real estate.
Even though, Black Money from abroad can take time (years) to come to India. But, we have GOOD news that generation of Black Money within the country may slow down (or stop) and Property prices can become affordable for the working class and their dreams of owning a home can become a reality.
Investors can cry and they will cry, but it’s a step in right direction by Modi government. Few (maybe 1 or 2 %) investors shall not be able to decide the fate of 90% of public.
Amen :)
As we all know, property market in India thrives on cash (or unreported income). As long as cash is being pumped into the realty market, it thrives and investors make merry. However, the Narendra Modi government's efforts to uncover black money have reduced the generation of black money in the system. The impact of this change will become more pronounced in the coming months.
"With the new Black Money Bill (which was passed by the Parliament on May 26) and with the Cabinet approving the Benami Transactions Bill in May this year, the crackdown on Black Money will continue further.
All these steps by the Narendra Modi government have impacted the realty market in short term; however, it's a step in right direction (if we look at the long term prospects).
For too many years, people avoided taxes and pumped that cash into realty market. Consequences of such theft (avoidance of tax) meant property prices were shooting (almost doubling in 2 years). People parked their unreported income into real estate. Some bought 8 flats, some bought 15 plots. It was crazy. Real estate became the best asset class to make money in short period of time.
However, working class (or salaried class) was suffering because of high values of real estate. They could not buy their dream home. Their dreams of owning a home was fading, slowly but surely. Congress party did nothing to stop this mad rush to own the real estate.
Even though, Black Money from abroad can take time (years) to come to India. But, we have GOOD news that generation of Black Money within the country may slow down (or stop) and Property prices can become affordable for the working class and their dreams of owning a home can become a reality.
Investors can cry and they will cry, but it’s a step in right direction by Modi government. Few (maybe 1 or 2 %) investors shall not be able to decide the fate of 90% of public.
Amen :)
Nice looking apartment. thanks for sharing it with us.
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