After trying for four months to sell his apartment in a western suburb of Mumbai, Meher Verma decided to cut the price by 10 percent. With property demand plummeting in the wake of November’s sudden ban on high-denomination notes, he’s not sure the reduction will do the trick.“I was hoping to sell my house soon,” said Verma, who put his two-bedroom property in Andheri on the market for $400,000 in September. “Now it looks like I might have to cut my price or wait much longer for the market to improve.” Real estate has long been a place where Indians have parked cash, often using money on which taxes haven’t been paid. Now, with Prime Minister Narendra Modi’s crackdown on so-called black money and the underground economy , real estate is taking a hit.The rate of home sales has fallen by about half since the government acted in early November, according to an estimate from Khushru Jijina, managing director of Piramal Fund Management Pvt. in Mumbai, who cited discussions with developers. Home prices may decline 20 percent and land prices could plummet as much as 25 percent, according to analysts’ projections.“Those who were looking to buy property as an investment vanished overnight from the market after the cash ban,” said Aubrey Carvallo, a Mumbai broker who has never seen demand in Mumbai so low in his two decades of working in the industry. He’s been unsuccessfully seeking buyers for eight apartments with prices starting at 15 million rupees ($220,000). “They are thinking of moving to stock markets and other financial assets, as real estate prices are set to correct in the coming years with the government crackdown on unaccounted money expected to continue."India’s largest developers, including DLF Ltd . and Lodha Developers Ltd., say they’re taking a hit on sales. Even an association with the U.S. president-elect hasn’t helped stoke sales at Lodha, which is building a Donald Trump-branded apartment tower in Mumbai’s Worli district. The 75-floor Trump Tower Mumbai, which includes a 24-hour resident manager and a fractional membership to a private jet service, has so far sold about 60 percent of the units since launching the project in 2014, according to Lodha.Lodha said in an e-mailed response to Bloomberg News that while it has notched sales of more 3 billion rupees for all its properties since November’s demonetization, sales would have been higher without the policy change.“No doubt that sentiment for real estate will be subdued over the next three to six months,” said Jijina at Piramal, citing the most pressure on luxury projects India-wide and in secondary cities such as Ahmedabad , Indore and Jaipur . Markets such as the region around the New Delhi area “where some developers took only cash will be in severe trouble,” he said.India’s S&P BSE India Realty Index, comprising 10 property stocks , has dropped 8 percent since the cash ban on Nov. 8, compared with a 2.5 percent decline in the broader S&P BSE Sensex Index.India withdrew 86 percent of the country’s banknotes in the nation’s biggest crackdown against corruption in almost four decades. Unaccounted-for money makes up as much as one-fifth of the Indian economy, according to Ambit Capital Pvt.Demonetization of high-value currency notes may especially hurt luxury market and land transactions because the cash component ranges from 30 percent to 50 percent of the value of such deals, said Mumbai-based Pankaj Kapoor, founder of Liases Foras Real Estate Rating & Research Pvt.“Land prices could drop as much as 25 percent once corruption is reduced and black money is out of the equation,” Kapoor said in an interview.CLSA Asia-Pacific Markets said in a note to clients that property and gold will see the biggest negative impacts due to their reliance on cash purchases. It put predictions for property price decreases at between 10 percent and 20 percent, and even more for land. The rate of home sales over the past year is down 13 percent from its 2013 peak, while property launches have dropped 45 percent from the peak in the same period, CLSA said.Demonetization has taken a toll on sales of under-construction properties, as “buyers have postponed purchase decisions given widespread talk about a price correction,” Citigroup Inc. said in a note to clients on Dec. 8.Developers holding large land banks will be affected and their projects will suffer as "prices will go crashing,” said Abhay Aima, group head for private banking at Mumbai-based HDFC Bank Ltd. , the country’s largest private-sector lender by value.In December, Prestige Estates Projects Ltd. , a Bangalore-based developer, said its pre-sales slid by half to about 1 billion rupees compared with previous months. Still, given the muted profitability in the residential business , developers are unlikely to cut prices sharply, the firm said. Once the anticipation of price declines eases, volumes should recover, the company said in a conference call with investors.India’s largest developers had just been starting to see the first signs of a recovery in demand for homes when the policy change came. Residential sales in Mumbai had climbed to the highest in seven years in the quarter ending in September, Liases Foras data show. Sales measured by area across eight major Indian cities rose 15 percent from 2015 levels, the best rate in five years, according to the data.DLF said that its residential sales of mostly high-end homes in Gurgaon , near New Delhi, had been looking up until demonetization. Inquiries remain high, but buying decisions are being deferred, the developer said on a conference call after it announced earnings in December. Markets should return to normal over the next two to three quarters, it said.Abhishek Lodha, managing director at Lodha Group, said he wouldn’t cut prices further, as construction costs have risen with demonetization and might still rise with a goods and services tax due to come into effect this year.“We do see a short-term impact on November sales volumes, with some spillover in December, too," Lodha said in the e-mailed response. "Beyond that, we don’t see much impact.”Developers and real estate analysts agree that over the long term, the combined effects of the demonetization and a new real estate law that will become effective this year will result in a consolidation of the industry, with stronger developers gaining strength while weaker ones get weeded out. Established firms will benefit from having more transparent purchases dominate the market going forward, and their buyer base will grow, according to JP Morgan Chase & Co.New regulations enacted last year, which stipulate more disclosure from developers and penalize them for failing to do so or changing the terms of agreed contracts, will help improve consumer confidence and push unprofessional companies from the sector, Lodha said. Demonetization as well as the goods and services tax will help India’s economy develop, he said.“We are hopeful that over the next decade, real estate will be seen in the same positive light that it is seen in the developed world,” Lodha said.