Real estate has its huge share of illegitimate capital. The sale-purchase of plots, flats, and commercial property involves a mixture of cash and cheques. The cash portion is often the black money that is paid as the balance amount of the actual deal value. Such deals are 20-30% more than the marked rates in the real estate circle. With the ban of Rs 1,000 and Rs 500 notes, realty prices will be corrected and will lead to the complete removal of black money. India’s tier- II and tier-III towns’ properties will have reduced prices, which in turn, will boost the demand. Real estate as a whole will be institutionalized because of this measure.
The banking sector has welcomed this resolve of the government, as it will destroy the coextensive black economy. Experts have marked this deviation from cash-dependence as a sign of a rapidly growing economy. There are 16.5 billion 500-rupee notes and 6.7 billion 1,000-rupee notes in circulation. Demonetization will repeal 80% of the total currency.
And that’s a real good move for a cleaner economy of India!