Demonetisation to help revive affordable housing segment

Demonetisation will help revive the latent demand in the housing sector as people now hope to buy houses in transparent deals, said Sriram Kalyanaraman, managing director & CEO, National Housing Bank. In an exclusive chat with ET’s Saikat Das, Kalyanaraman said some segments of the housing sector will especially benefit from it as prices may correct 15-20% with adequate supplies. Edited excerpts…
Will demonetisation drive demand in the housing sector in direct foreign investment in India?
Housing finance is a long term requirement, and the demonetisation exercise will have a long term impact as it will benefit both consumers and the industry. Most of the housing finance players have put in place systems for e-payments and e-receipts in chartered accountant firms in mumbai. Demonetisation will further improve the use of e-transactions and reduce cash dealings. It will result in greater transparency in property contracts, which will also bring in greater professionalism in the industry. As a result, the latent demand, particularly in the affordable segment is expected to revive, thereby increasing sales.
But will home prices come down?
We expect housing prices to correct by 15-20% in some segments. But we do not think it is a gloom and doom scenario. On the contrary, with a dip in prices and higher transparency in dealings, demand will pick up in the medium to long term.

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