KOZHIKODE: The demonetisation of the high-value notes seems to have had a direct fallout on the realty business in Kozhikode: A sharp slump in registration of properties.
According to sources in different sub-registrar offices, the total number of registrations per day was even below 20 per cent of the normal rate. While some sub-registrar offices did not clock any registration at all, an officer with the Kakkodi sub-registrar office said that there were three registrations in their office after the note ban came into effect.
“We normally register transactions of 10 to 15 properties a day. Since people are bereft of high-denomination notes to buy stamp paper and pay registration fees, registrations seems to have been hit,” the officer said. “Some of the parties have given the new `2,000 notes while paying the registration fee,” she added.
Demand for alternative modes of payment
While the dip is expected to continue in the coming days, real estate developers have come out demanding alternative modes of payment for remitting registration fee. “As of now, fee towards registration is only accepted by means of cash, which makes it difficult for the parties involved.
The government should allow the parties to pay registration fee through other modes, including demand draft,” said Confederation of Real Estate Developers’ Associations of India (CREDAI) state governing council member M A Mehaboob.
According to real estate developers and consultants, the demonetisation move would have a negative impact on the unorganised builders and secondary (resale) property market.
“Big builders and organised players will largely remain insulated as they are already channeling via banks. The impact will be felt in the secondary market and the unorganised developers community, who largely rely on cash dealings,” Mehaboob said. “There could also be downward pressure on land prices, which will boost demand in the sector,” he added.