Fitch Expects Decline in Housing Sales
According to a latest report of Fitch Ratings, the residential property sales in India are expected to witness at least 20-30 per cent dip in 2017 due to demonetisation impact. In its report “2017 Outlook: Asia-Pacific Corporates”, Fitch changed its outlook on Indian housing sector to negative from stable.
“We changed our sector outlook on Indian homebuilders to negative, from stable, after the authorities took steps in November 2016 to demonetise large-denomination bank notes,” the report said.
One goal of demonetisation is to curtail undeclared wealth, which will take its toll on home demand, said the agency.
“Fitch expects residential property sales of most Indian homebuilders to weaken by at least 20-30 per cent this year,” according to the report. It said Chinese homebuilders had the only positive sector outlook in APAC in 2016.
“We have revised it to neutral in 2017 to reflect policy intervention to clamp down on speculative and investment demand for residential properties,” it added.
For China, Fitch expects housing sales to decline 15 per cent in 2017. Overall, Fitch Ratings has assigned a negative outlook to almost one third of Asia-Pacific (APAC) corporate sectors for 2017.