The Real black money of India lies within India locked up in The real estate business dealings in Mumbai, Gurgaon, Bangalore, Delhi, Chennai, Pune. Let the IT authorise and investigate private builders in these cities who still demand 50-40% of the transaction in cash for sale of apartments. IT department is keeping a blind eye on such deals. Where do these builders get funding for holding large numbers of unsold flats and where does this money go to? Swiss banks and other foreign haves will only have a miniscule of the total black money. Property prices are high because most of the black money is invested in real estate. Property prices have gone beyond the roof and purchasing power of the middle class. Look at the inventory levels in big cities — they are extremely high. No one lives in most of these apartments(even still the rates climb). In any other business, prices would have fallen to a level where liquidation of these inventories would have allowed the working capital to recycle in the system. Since the sources of black money are perennial and the owners have no other reasons to cash out the return (where else will they invest this ill gotten money ?), real estate prices keep rising. Such bubbles would have burst in most markets but the real estate bubble in India is made of black money, so it will not burst. It will just make finding housing more difficult for the people. One can have the following reasons for not buying a property: Prices are much higher compared with what one can pay in developed countries; if you can buy there. Even in places such as Qatar/Muscat/Dubai, which has got world Class excellent infrastructure, the cost of real estate is much cheaper than Delhi/Mumbai. If the Present Modi headed Indian government is keen of routing out black money, let them take control of the real estate trade(which is having its own Fleecing set of middlemen/Brokers) and monitor each deal to ensure 100% of sales are through bank payments only.
Posted on: Mon, 27 Oct 2014 13:11:16 +0000
Trending Topics
Recently Viewed Topics
© 2015