Wednesday, 30 November 2016

Black is Back! After demonetization the color of money in Real Estate is still BLACK


Magicbricks NOW, a part of the TIMES NETWORKconducted a shocking investigation called ‘Black In Demand’. Aimed at examining the ground reality of black money  in the real estate sector post the government’s move of  demonetisation. The channel's team of reporters visited a number of projects, posing as home buyers and met with several builders from the industry. The findings of this investigation were startling and posed a lot of questions on the impact of demonetisation  in the Real Estate sector that was still accepting cash payments, both new and old notes. Developers across the city were more than willing to accept the defunct old notes at a premium if the payment was made in the next few days. The old 500 and 1000 notes are being accepted at a daily spot trading rate that decides the premium on these notes. These revelations were aired live on the channel from 5pm onwards on November 28th,2016.

Commenting on this sting operation, Faye Dsouza, Editor, Magicbricks NOW said, “The demonetization decision which was aimed at cleaning up the real estate sector has led to the creation of a parallel black market for black money.  Our investigation reveals that while some developers are conducting business completely in white, several builders who were under financial stress before demonetisation are using this economic change as an opportunity to offload inventory to the community that suddenly finds itself stuck with cash.”

Aarti Sathe, Spokesperson BJP, said, “We'll take strict action against such builders who are accepting defunct notes. As a part of the government we would leave the entire matter to investigative agencies to carry forward their process as per the framework of law. ”

Kishori Pednekar, Shiv Sena’s  Senior Corporatorsaid,Demonetization has not brought any substantial change in the country. We are shocked to see these developments in the real estate sector and I would like to urge the government to impose 100% penalty on the culprits.”

Abha Singh, Lawyer & Activist, said, The common man who is standing in the line, is dying. It is very debatable whether demonetization has helped or not. The whole scheme has come out as a huge failure.”

Avadhut WaghSpokesperson Maharashtra BJPsaid, Real Estate has collapsed by 30%. The war against corruption & #BlackMoney is not a one-day match or T20 match. It's a 5 day test cricket match! The results of this match can only be seen at the end of March 31st ,2017. For this demonetization drive to be successful all phases need to be in place.”

Ramesh Nair, COO & International Director - JLL India, Board Member, said, Like every market, real estate market has it's good apples and bad apples. India saves around $ 160 billion every year in real estate compared to 5 bn in stocks & mutual funds. Clean-up in not going to happen in 2 months’ time.”

Sanjay Jha, National Spokesperson, INC Party, said, “Demonetization has been a monumental disaster. The real estate sector is galloping with #BlackMoneyMost of the people don't have bank accounts in the country even today. Big builders are selling the property at inflated prices & taking the money in cash. The fact is if you're targeting only 6% of#BlackMoney, it’s like looking for a needle in a haystack. All the politicians should come under RTI and disclose the source of funds”

BJP leader Sudesh Verma, said, “Investigation will take place. The legal proceedings will take place.”

Congress leader Anand Sharma, said “ There is a huge market of money laundering which has been created. It is corrupting the country, forcing the people to resort to illegal means.”


Could this  loophole that is being exploited by builders be curbed or closed ? Where would this revelation leave the demonetization drive? Only time will tell the future of the sector.

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