In the one year that passed, the sector that contributes 5-6% to India’s GDP and is the largest employer after agriculture, saw tepid sales. The addition of GST and RERA, have only hurted sentiments.

OF SLUGGISH SENTIMENTS

A report from FICCI, NAREDCO, and Knight Frank reveals gaps in consumer spending pattern. The research, published in September 2017 basically indicates future sentiment index tapering to a 39 month low in Western India (Maharashtra, Goa and Gujarat).

After the implementation of GST, sentiments among builders and stakeholders too dipped. Barely 51% suggested that the economy will better in coming 6 months, as against 62% in the previous quarter. 49% stakeholders in September as against 67% in June opined that funding scenario will better.

Shishir Baijal, CMD at Knight & Frank explained that the prevalent mood in the industry reflected that the sector finally had come to terms with short-term adverse impacts of the structural reforms.

Manju Yagnik the Vice-Chairperson from Nahar Group remained critical of the sentiment index, suggesting, "it was negative sentiment that due to demonetisation the property costs will go down and that’s exactly what the people kept waiting for instead of investing."

NEW LAUNCHES

It remains difficult to rubbish off the claims made by Knight Frank. PropEquity, a real estate research firm that conducts quarterly research on real estate inventories and launches too suggested a declining pattern.

An official note from propequity suggests new launches dipped 83% across top 8 cities in the third quarter from 24,900 units to nearly 4,313 units in the September quarter. Year on Year as well as quarter on quarter statistics of new launches dipped in Chennai, Bengaluru, Mumbai, Gurugram, Noida, Hyderabad, Pune, and Mumbai.

Prices in cities like Kolkata and Chennai witnessed a 7% slump. Demonetisation and the confusion of GST impacted the resale market too. Cities such as Thane witnessed a 9% slump, while Chennai, Ahmedabad, Noida, Pune witnessed an over 7% slump in second-hand properties.

Samir Jasuja, the founder at PropEquity was quoted in a note saying that festival period too added to some respite. "Late November, the demonetisation severely impacted the real estate sector across India and that led to low transactions. There is definitely stable demand for read-to-move-in and resale properties," he said.

DIP IN LABOUR

Real estate contributes the highest to the Indian GDP after agriculture according to an IBEF report. The sector was expected to grow 30% to reach $180 billion by 2020. Housing sector alone contributes nearly 5-6% to the GDP. Post demonetisation, construction labourers, who have majorly survived on cash payouts were hit the most.

PHD, a commerce association, found that there was a decline in contractual employees during this period. Although their research does not critically limit itself to a specific sector, it can be assumed that real estate, which is the second largest employer was also impacted.

The PHD report additionally confirms the slip in economy suggesting 65% of firms across major sectors registered a decline in sales post demonetization.

Anil Khaitan, PHD's President suggested that going ahead, it was essential to revive demand to refuel economic growth. Owing to less purchasing power, demand has not yet picked up fully in the economy, he explained.

WHAT ARE DEVELOPERS SAYING

Ashish Purvankara from Bengaluru's Purvankara Realtors maintained that demonetisation impact in the city was limited to the first two quarters. It was a tiny-speed breaker and post the initial jolt, the South real estate sector especially in Bengaluru saw a steady rise.

"With the renewed consumer confidence in the last quarter of FY16-17 (January –March 2017) the Bengaluru market continued to remain stable versus other cities. Being an end-user driven market and backed by white collar job prospects, it promises for better times ahead for the Bengaluru real estate industry," he adds.

Manju Yagnik, Vice-Chairperson at Nahar Group suggests that demonetisation resuited in "standardisation of pricing", besides helping create a "cleaner image for Real Estate".

Niranjan Hirandani, a prominent realtor and NAREDCO’s President too agreed suggesting, "it has led to greater efficiencies and transparency in the real estate sector and we welcome this.”

PRICE-REVIVAL ON CARDS?

While dipping interest rates may prompt one to actually buy a house. The Knight Frank report suggests that future sentiment scores are yet to reach pessimistic zones. "No revival is expected in the near 6 months," Dr. Samantak Das, Chief Economist at Knight & Frank had written in the report published in September 2017.

For property buyers, the report points out that 73% respondents indicating price appreciation to stagnate or worsen in 6 months.

So, if you are among those keen to buy a house, you should think of holding your buy-decision for a few more months. Industry experts also suggest that this could change with the ongoing festival period.

Shubhika Bilkha, a senior representative from The Real Estate Management Institute (REMI), reasons, "With excess residential inventory in the market, a more regularised industry, transactional transparency, lower home loan rates and the CLSS [credit linked subsidy scheme] for mid and affordable home buyers launched by the NHB, it is expected that the sector should see some respite during the festive season."