Demonetization of of Rs. 500 & Rs. 1000 currency notes: Impact on real estate - Our view
Vakkachan George, Managing Director, KCC Homes
On the context of Central Govt. banning the legal tender of currency notes with 500 & 1000 denominations, this letter is intended to address the possible concerns that you may have with regard to our residential projects.
As you might already be aware, this ban was introduced by the Central Government for two major reasons.
1) To end the circulation of unaccounted cash.
2) As a step against forged currency.
As it is understood, the major portion of transactions involved in land deals (not villa or flat) in India is through cash, most of which is unaccounted. In Kerala, which is an NRI dominated economy, almost all transactions happen through banks. On the contrary, cash is usually withdrawn from the banks to avoid high registration charges. So the buyers are tempted to make their money black from white sources.
Unlike other metropolitan cities and states, Kerala possesses comparatively very less unaccounted cash, as this is an NRI based economy. Major builders in Kerala will not see any value depreciation or price correction as margins here are less compared to builders of other states in India.
Especially on the current scenario, I must also gladly admit that KCC Homes is blessed to have a strong network of highly professional clients and we also expect to have such clients in future as well.
We whole-heartedly welcome the Government's move as this is intended to control inflation and make land prices realistic. As it goes without saying, over the last many years, we have been able to build our repute as the least priced builder in Kottayam with highly realistic rates, and we do not think this new move will have any adverse impact on us. Let me reassure you that our projects are rated as few of the finest ones in Kottayam and every effort shall be made to provide transparency in all our dealings and to ensure the delivery of your dream home well in time.