The real estate sector in Ludhiana seems to be going through a bad phase, as a recent report released by the National Housing Bank (NHB) suggests a fall in prices of residential units in the January-March 2017 quarter. According to NHB, out of the 50 cities which were monitored, 27 witnessed an improvement in prices in the quarter ending March 2017, as against that of December 2016. But 19 out of the 50 cities witnessed a fall in the index of property prices.
Among the cities which witnessed a fall in property prices, Ludhiana had a fall of 7.8% as compared to prices in December last year. In Delhi, property prices fell by 4.3%, Gandhinagar by 12%, Surat 8.9%, and Kolkata by 7.2%. Real estate experts say there were multiple factors for the fall in property prices, the main being demonetization.
"After demonetization, people didn't have cash to buy property, as their money was locked up in banks. Also, traders were concerned about GST for many months, as they were more worried about running their business than buying property, which resulted in a fall in property prices," said real estate consultant Ashwani Verma. He added that the main factor for the fall in prices, however, was the negative sentiment in the market, which was prevailing because of complexity in documentation for builders.
A builder said it was very difficult to get 'No Objection Certificates' (NOCs) and other related documents, which prevented them from coming up with new housing colonies. He added that with a new government in place in the state, they expect things to be simplified for the real estate industry.
Buyers confirm that demonetization and GST created an atmosphere which prevented them from buying property. "I was planning to buy land, but after demonetization, I had to park my money in a bank. Also, since business was not doing well, I had decided to postpone my plans," said Hardeep Singh, a trader in Civil Lines.
