Cash crunch hits flat sales in city

Vijayawada: Demonetisation has badly affected the sales of apartments in and around the city since 50 days.

Due to cash crunch, the buyers are not able to get
new currency from the banks
or ATMs.

The RBI is strictly implementing the cash withdrawing limit to only Rs 24,000 in a week.

The apartment flats rates are between Rs 30 lakh to Rs.1.50 crore depending on the plinth area, amenities provided by the builder and location of the apartment.

If the sales drop further, the builders will incur huge losses in future as bank interests will rise gradually.

Nearly 200 builders are engaged in construction of apartments, group houses and individual houses in and around the city.

After bifurcation of the State, many builders from Coastal districts and Hyderabad have started construction of apartments in and around the city.

After two years of work, most of the apartments are in the finishing stage and will be ready for occupation in another six months.

Unfortunately, the demonetisation of high denomination notes of Rs 500 and Rs1000 had a huge impact on the sale of apartments for more than 50 days.

Buyers who would like to purchase flats on payment of cash may face many problems due to non-availability of cash.

The recent speech made by Prime Minister Narendra Modi to the nation had also not given time frame when the cash crunch would be solved.

The realtors have pumped hundreds of crores of rupees for the construction of apartments in and around the city particularly in Gollapudi, Ajit Singh Nagar, Madhura Nagar, Gollapudi, Bhavanipuram, Madhura Nagar, Bhavanipuram, Vidyadharapuram, Payakapuram and other areas of the city.

The Confederation of Real Estate Developers Association of India Andhra Pradesh president A Siva Reddy has admitted that the sale of apartments fell in the past 50 days due to demonetisation.

He felt the sales will pickup once the cash flows increases from the RBI.

He said there will be less impact on the construction of apartments as money circulation will increase gradually in the coming months.

R Bhaskar, a builder at Ajit Singh Nagar, said the demonetisation was a big blow to the builders who completed more than 90 per cent apartment works.

He said if the sales are getting delayed the interest will be increased and it will lead to rise of flat prices.

He said small and middle level builders are constructing the apartments by taking loans from the banks and other sources.

Meanwhile, buyers, too, are suffering due to demonetisation as cash is not available in the banks or ATMs.