> I'll have to pay everything from my bank account, which will get tracked eventually to the seller I purchase my house from.
Sorry dude. You are disconnected from reality. Workaround always exist. People still prefer to pay, as much as possible in cash, to save on that huge registration fees.
This demonitization was just a smoke in people's eyes. Those big thugs are still scaming the banks and fleeing the country with billions of Rupees.
Of course. Every system has workarounds.
> People still prefer to pay, as much as possible in cash, to save on that huge registration fees.
For large real-estate companies, like Aparna Constructions in Hyderabad, most of the transaction is with fully accounted money. About 10% of the transaction is with un-accounted for cash.
Cash transactions are happening with smaller builders, but even they are finding it difficult to find buyers with a lot of liquid cash.
Now most of the money is being moved through faceless anonymous companies, and those are a step above unaccounted cash, when it comes to tracking and monitoring cash flow in the economy.
> This demonitization was just a smoke in people's eyes.
Perhaps, but along with the introduction of GST, I now find even traditional traders who usually prefer not to give a bill with a sale (for construction items, cement, steel, electrical wires, equipment, etc) are insisting on a GST bill. It was a really big surprise to me.
Also, this is a political masterstroke. Most of the country is below middle class and hardly every see a 2000 Rs. note. Most of them don't have much liquid cash. Most of them are happy that the rich are finally 'getting it' as in, finally there is someone in power who is not afraid to walk the talk.
Whether this is just smoke and mirrors is a different debate. But for most of the country, most of the poor people in the country, it's a eye-brow raising move, a very big talking point for worker level party operatives.
My personal opinion is that these sorts of actions are required to take the populace from cash to digital transactions. Waiting for natural course of movement to digital transactions will take an un-accptably long time.
With demonitization, many farmers, people in remote villages, even street vendors are using digital transactions. Credit-card use has increased, digital payments from mobile phones has increased.
Most importantly, the concept of digital transactions, virtual cash, in some very remote places, even the concept of bank accounts has entered into the greater public consciousness.
> Those big thugs are still scaming the banks and fleeing the country with billions of Rupees.
This happens in even the most developed countries. Even in the US, Europe, UK etc. The only difference is there the money is transferred to accounts in the Cayman islands, here in India, perhaps some other route.
Its impossible to register a property in Karnataka, without a PAN card/number. So in short for high value transaction its already possible to have tax accountability. Same with jewelry. The question is that of enforcement. You don't need to demonetize anything for these things.
>>Perhaps, but along with the introduction of GST, I now find even traditional traders who usually prefer not to give a bill with a sale (for construction items, cement, steel, electrical wires, equipment, etc) are insisting on a GST bill. It was a really big surprise to me.
What is going to be a bigger surprise to you is discovering a few years down the lane that a full scale parallel unregulated economy is in motion.
In fact that is already the case with a lot of small time things now.
>>Also, this is a political masterstroke.
Lol
>>Most of the country is below middle class and hardly every see a 2000 Rs. note.
Middle class these days is like people who make a good 30-40K a month. These people see a lot of high value notes.
>>Most of them are happy that the rich are finally 'getting it'
What do you think the year is? 1985?
The rich don't exactly keep their money beneath their mattress these days.
>>My personal opinion is that these sorts of actions are required to take the populace from cash to digital transactions.
>>With demonitization, many farmers, people in remote villages, even street vendors are using digital transactions
Before you implement all these pie in the sky electronic transaction ideas. Please ensure people get electricity. In Bangalore in weekdays there are half a day power cuts.
How should public do electronic transactions without electricity?.
How do you explain the actual change that has occured in the real estate market then?
> What is going to be a bigger surprise to you is discovering a few years down the lane that a full scale parallel unregulated economy is in motion.
Of course. Nobody says that this will kill all illegal activity for all time in this country of 1.25 billion people. But there was a big positive effect due to demonetisation. Even if it dents the black economy for 5 years, that's good enough. We'll take more such actions when needed.
> Middle class these days is like people who make a good 30-40K a month. These people see a lot of high value notes.
https://www.livemint.com/Opinion/TvcFydQcN6KEFkvdW7BprM/Indi...
From the article: vast majority of middle class in india earns less than $4 per day. A ₹2000 note is 10 days wages. Yeah, I don't think those guys will ever save that much while still surviving.
> The rich don't exactly keep their money beneath their mattress these days.
Yup, they were forced to move it from there in 2016. Some moved it to bitcoin, as described in TFA.
> Before you implement all these pie in the sky electronic transaction ideas. Please ensure people get electricity.
Bullshit. Electrification and economic reforms can happen simultaneously in the world's seventh largest economy. For example, 2018 was the first year when all villages satisfied the criteria for being electrified. Long way from 24x7 electricity, but hey, it's a start.
What change has happened in the Real estate market? The big builders are continuing to sell their inventories as they were doing before with cheques and RTGS transactions.
People still continue pay bribes to registration offices.
In fact plots around vicinity of Bangalore are still going like hot cakes.
If you are fed up about property rates, then there is going to be no relief there. People are coming to cities for jobs through flood gates, and demand is far higher than supply. Every year one crore babies are born in India, and all of them need homes to stay 20 years from now, this is year after year, every single year.
When the demand is this high, how do you expect prices to not go up?
>>Even if it dents the black economy for 5 years
It didn't anything even for 5 minutes.
Only thing it achieved is slowed economic growth.
>>We'll take more such actions when needed.
Again, who is this 'we'.
>>vast majority of middle class in india earns less than $4 per day.
That's the poor, and they were worse effected. The unorganized sector where these people are largely employed suffered and many jobs were lost.
>>Yup, they were forced to move it from there in 2016. Some moved it to bitcoin, as described in TFA.
Not even fools keep their money in cash, even in the past. People invest money.
Indian economy didn't exactly come magically into existence in 2016. So please...
>>Bullshit. Electrification and economic reforms can happen simultaneously in the world's seventh largest economy.
You call these 'economic reforms' :)
Great, carry on.
I can only talk from my experience. Me and my father searched for an apartment about 6 months before the demonetisation. And I'm searching one for me now. There is a clear difference.
Keep note that any builder where software engineers buy, the big builder types, do not take cash money. In fact the payment schedule and mechanism is all in cheque or RTGS transactions. So that is barely a problem with or without any government action. Even in the worst case you still have to submit your PAN, so the government can easily audit your case even in case of cash transactions.
If you are complaining about the bribe you have to pay during property registration. Make note you will be made to pay that even you do not do undervalue registration and pay the full amount. They charge you bribe even if all your papers are right.
That sort of corruption can already be dealt with. But no one really tries hard enough because you have to burn down the whole system to do that. Every table in the registration office takes a cut to pass a paper to the next table.
If your whole system is corrupt top down, you have little hope to fight these things apart from long term social reforms.