ASSESSING IMPACT OF DEMONETIZATION AND RERA ON REAL ESTATE SECTOR

Abstract

The Real Estate Sector is an aggregate made up of the housing, industrial, office and retail sectors; wherein, housing sector plays the most significant role. At any point in time, this sector may not be at demand-supply equilibrium because of frequent exogenous parameters and several uncertainties present. Sudden announcement of demonetization on 8th November 2016 and implementation of Real Estate Regulation (and Development) Act (RERA), 2016 with effect from 1st May 2017 have severally affected demand-supply equilibrium in Indian Real Estate Sector. Demonetization has adversely affected the Real Estate Sector with cash transactions getting eliminated and wiping out black money from the sector. Further, implementation of RERA aims to create a more transparent environment for property buyers by increasing the accountability of developers and regulating the Real Estate Sector. Therefore, assessment of impact of demonetization and RERA on Real Estate Sector has become inevitable to understand volatility resulting into the sector due to them and perspectives of important stakeholders about them.In this research paper, assessment of impact of demonetization and RERA on Real Estate Sector in the city of Pune has been carried out using analysis of Registrations of Documents, Revenue Collections, Annual Statements Rates and Market Rates of housing properties, and conducting primary survey of experts, developers, and buyers.