Real Estate Market Unscathed after Recent Economic Dips
In the last decade, Pakistan’s realty market has undergone considerable maturity. At present, their housing economy has developed the ability to withstand serious economic hits. Especially when one considers the last one a half years after the Pakistan Tehreek-e-Insaf regime rose to prominence.
Analysts believe that the government of the day has not formulated solid economic policies or consulted with the International Monetary Fund for some much-needed bailout package.
Despite the numerous challenges facing the realty sector, the industry remains transfixed. Those in the know have lauded the state of the real estate business since it’s performed quite well. On the other hand, numerous other sectors of the economy have nosedived and eaten into public investment.
Historically, investments made by Pakistanis living abroad have contributed greatly to the real estate market. The current slowdown in the market is attributable to the fact that most of them are currently waiting for the right time to invest heavily in the sector.
For many, real estate investment is the most sure-fire way to make money. Even with the optimism in the market, there are still fears by some that the restrictions may be placed on property purchase by those unwilling to file tax returns.
According to Abdul Ghafoor, a realtor based at Lahore, the current phase is not great for the realty sector. He opined that the market has not crashed, rather, it’s simply a slowdown with genuine buyers and sellers still lurking in the horizon.
Ghafoor cited that part of the reason why the fears exist is that overseas investors are now under the Federal Board of Revenue’s (FBR) radar. There ongoing money laundering probe plus various other government projects focused on investigating property holders who are based abroad has ignited panic in the markets. He shared that there’s a great fear among investors because nobody wants to have their money trail investigated.
In Zameen’s October 2018 report, they lay claim to their belief that the market was sufficiently stable. Data collected by them shows that they expect some up and downs across various real estate locations spread in 6 cities.
The property prices in a couple of major cities like Islamabad, Lahore, Karachi, Multan, and Gujranwala have fluctuated by an incredible 1%. The exception to the rule is DHA Gujranwala. In the city, the plot prices have risen slightly by 2.12%-3.25%. More specifically, the price variation was most evident on 10 marla and one-kanal plots.
At the same time, the proceedings at the Supreme court have influenced property prices. The case against Bahria Town resident, Malik Riaz, has been instrumental in shaping the property price landscape not just in Bahria Town, but also across all major towns.
In October, one-kanal plot prices in Karachi, Bahria Town Lahore, and Islamabad have increased by 0.35 percent, 0.16 percent, and 0.29 percent respectively.
Analysts who are well briefed on the situation believe that the extent of the real estate sector has rapidly increased following the entry of investors in Gujranwala, Multan, Faisalabad, and Gwadar. Their involvement in these towns has overshadowed the action in the 3 primary metropolitan cities o Islamabad, Karachi and Lahore.
Waseem Tariq, a real estate expert, has revealed that the reason behind the massive success of the real estate sector are investors based abroad. He further added that friends and family members of most investors have joined the real estate game as a result. However, the major impediment that now exists is the requirement to show a money trail before properties get purchased.
Regardless of this, many Pakistanis are actively involved in the sector as investors in one way or another. As Tariq pointed out during the briefing, there’s been a considerable bump in the Pakistani population in recent years. More than ever, Pakistanis are faced with a shortage in housing units.
The recent emergence of housing societies has been met with welcomed by many people. Most of the new housing units are funded by famous and respected members of society. Prominent people like international developers are actively involved in the new setup.
Tariq pointed out that the prime minister’s new 5 million housing units’ development is likely going to further boost the real estate economy in the country.
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