Some projects faced hurdles, but did not affect overall real estate market
By Shahram Haq
Published in The Express Tribune, November 1st, 2015.
The real estate market entered the fourth quarter smoothly, banking on the success of several popular property markets.
This followed a continuous rise in prices of real estate in major cities – Lahore, Karachi and Islamabad – in the third (July-September) quarter of 2015.
Even though some projects of prominent developers did face a few impediments, this was not a reason enough to raise major concerns, according to a report released by zameen.com, an online property portal.
According to the report, Karachi’s realty market performed brilliantly. There was just one exception – Bahria Town Karachi – which posted unfavourable numbers as prices of 250 square yard plots fell 5.39%. Similarly, a drop of 3.85% was recorded in 500 square yard plots in the third quarter.
DHA Karachi and DHA City Karachi, on the other hand, did not disappoint and gave investors encouraging returns. DHA Karachi recorded a sharp 8.27% price gain for 500 square yard plots and an even sharper rise of 12.35% for 250 square yard plots.
DHA City Karachi registered increases of 16.60% and 11.65% in prices of the two categories respectively.
DHA Karachi once again emerged as the most expensive locality, where the average sale price of a 500-square-yard house stood at Rs. 60 million and that of a 250-square-yard home was Rs. 41 million.
Lahore market
The property market of Lahore saw a humble upward movement. Although many major localities continued to excite investors by registering good levels of growth, DHA Lahore remained merely stable in the one-kanal category with prices dropping a negligible 0.69%.
However in the 10-marla category, a sharp drop of 6.61% was registered in the third quarter, said the report.
There could be a variety of reasons behind this, including the imposition of withholding tax on banking transactions, a rise in taxes and the income source disclosure notices sent to investors. Most significantly, the take-off of DHA projects in Bahawalpur, Multan and Peshawar may have shifted investor focus.
In contrast, Bahria Town and LDA Avenue-I performed well despite multiple pending litigations. Bahria Town depicted a sharp price rise of 14.57% for one-kanal plots and a 5.32% increase for 10-marla plots. LDA Avenue-I posted a 5.04% rise in the one-kanal category and 7.63% gain in the 10-marla category.
Islamabad market
The real estate market of Islamabad showed a mixed picture. Sector E-11 registered price increases of 3.33% and 1.69% and F-11 recorded rises of 2.22% and 3.73% for one-kanal and 10-marla categories respectively.
Bahria Town experienced a sharp 5.66% rise for one-
Pakistan’s realty market has got matured substantially over the past decade as it has been able to absorb economic jolts, particularly in the past one and a half year and since the Pakistan Tehreek-e-Insaf (PTI) government came to power in August this year.
The current government, according to analysts, has not presented any firm economic policy so far, nor did it manage to secure any bailout package from the International Monetary Fund to avert a balance of payments crisis. Despite these, the realty sector, unlike other segments of the economy, is at a standstill and has not experienced a major dip which could eat up public investment.
Investments from overseas Pakistanis have always played a key role in the real estate market. However, they are waiting for an appropriate time to invest as they see the sector as the easiest way to make money in Pakistan. They are fearful that restrictions may be placed on property purchase by non-filers of tax returns.
“The market has not crashed, genuine buyers and sellers are still present, however, we cannot call this a great phase for the realty sector,” remarked Lahore-based realtor Abdul Ghafoor.
Placing overseas investors under the Federal Board of Revenue’s (FBR) radar coupled with ongoing money laundering probe and other similar government initiatives to investigate foreign property holders had sparked panic, he said. “No one wants the FBR or other law enforcement agencies to investigate their money trail.”
The market is likely to remain on the same track in the near future. Zameen.com, a real estate portal, in its report for October 2018 described the real estate sector as stable. Its data suggests a minor drop or rise in different real estate hubs in six major cities.
Property prices in the Defence Housing Authority in all major cities like Lahore, Karachi, Islamabad, Gujranwala and Multan fluctuated merely 1%. The only exception was DHA Gujranwala where one-kanal and 10-marla plot prices showed a modest growth of 2.12% and 3.25% respectively.
Similarly, ongoing Supreme Court proceedings against Malik Riaz of Bahria Town did not put much pressure on property prices in the Bahria Town in all major cities.
One-kanal plot prices in Bahria Town Lahore, Islamabad and Karachi edged up 0.16%, 0.29% and 0.35% respectively in October.
Experts suggested that the scope of the real estate sector had expanded manifold after investors also focused on Gwadar, Multan, Gujranwala and Faisalabad besides the three main metropolitan cities – Lahore, Karachi and Islamabad.
“Overseas investors are the prime reason why this sector thrives,” said real estate expert Waseem Tariq. “Relatives of many investors have become realtors but the requirement of showing the money trail prior to buying a property has put brakes on such investments.”
Stakes remain high as a majority of Pakistanis are now investing in this sector either directly or indirectly.
“Pakistan’s population has increased manifold and Pakistanis are facing a huge shortfall in housing units,” Tariq pointed out. “The emergence of new housing societies by well-known, new and international developers coupled with prime minister’s 5 million housing units’ program can further steer the wave of investment towards the real estate sector.”
kanal plots whereas prices of 10-marla plots remained stable, with a negligible drop of 0.76%. Activity in DHA Islamabad seemed listless this time around. The one-kanal category saw a 1.57% drop, while 10-marla plots recorded a 4.30% drop.
The status of DHA Valley and the intended development of Dadocha dam on its site remained controversial. Needless to say, investor confidence has taken a hit.
However, DHA Islamabad has recently announced plans to allot alternative plots to those affected by the DHA Valley problems, so things could start to look better soon.
Predictably, Sector F-11 remained one of the most expensive localities, where the average price of a one-kanal house stood around Rs. 69 million and that of a 10-marla house was around Rs. 36 million.
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Real estate market unfazed by economic shocks
Property prices remain static despite balance of payments woes
By Shahram Haq
Published in The Express Tribune, December 8th, 2018
Pakistan’s realty market has got matured substantially over the past decade as it has been able to absorb economic jolts, particularly in the past one and a half year and since the Pakistan Tehreek-e-Insaf (PTI) government came to power in August this year.
The current government, according to analysts, has not presented any firm economic policy so far, nor did it manage to secure any bailout package from the International Monetary Fund to avert a balance of payments crisis. Despite these, the realty sector, unlike other segments of the economy, is at a standstill and has not experienced a major dip which could eat up public investment.
Investments from overseas Pakistanis have always played a key role in the real estate market. However, they are waiting for an appropriate time to invest as they see the sector as the easiest way to make money in Pakistan. They are fearful that restrictions may be placed on property purchase by non-filers of tax returns.
“The market has not crashed, genuine buyers and sellers are still present, however, we cannot call this a great phase for the realty sector,” remarked Lahore-based realtor Abdul Ghafoor.
Placing overseas investors under the Federal Board of Revenue’s (FBR) radar coupled with ongoing money laundering probe and other similar government initiatives to investigate foreign property holders had sparked panic, he said. “No one wants the FBR or other law enforcement agencies to investigate their money trail.”
The market is likely to remain on the same track in the near future. Zameen.com, a real estate portal, in its report for October 2018 described the real estate sector as stable. Its data suggests a minor drop or rise in different real estate hubs in six major cities.
Property prices in the Defence Housing Authority in all major cities like Lahore, Karachi, Islamabad, Gujranwala and Multan fluctuated merely 1%. The only exception was DHA Gujranwala where one-kanal and 10-marla plot prices showed a modest growth of 2.12% and 3.25% respectively.
Similarly, ongoing Supreme Court proceedings against Malik Riaz of Bahria Town did not put much pressure on property prices in the Bahria Town in all major cities.
One-kanal plot prices in Bahria Town Lahore, Islamabad and Karachi edged up 0.16%, 0.29% and 0.35% respectively in October.
Experts suggested that the scope of the real estate sector had expanded manifold after investors also focused on Gwadar, Multan, Gujranwala and Faisalabad besides the three main metropolitan cities – Lahore, Karachi and Islamabad.
“Overseas investors are the prime reason why this sector thrives,” said real estate expert Waseem Tariq. “Relatives of many investors have become realtors but the requirement of showing the money trail prior to buying a property has put brakes on such investments.”
Stakes remain high as a majority of Pakistanis are now investing in this sector either directly or indirectly.
“Pakistan’s population has increased manifold and Pakistanis are facing a huge shortfall in housing units,” Tariq pointed out. “The emergence of new housing societies by well-known, new and international developers coupled with prime minister’s 5 million housing units’ program can further steer the wave of investment towards the real estate sector.”
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Real estate market shows modest growth
All major cities experience moderate changes and stability
By Shahram Haq
Published in The Express Tribune, April 8th, 2018
The real estate market of all major cities of Pakistan showed modest growth in February, with hope that prices would strengthen even as elections approach later this year.
Last year’s bearish trends still affected buying, as growth was moderate, and no society stood out drastically, revealed a report of an online property portal.
“However, the moderate growth and buying trends indicated that investors are returning to the market after last year’s calmness,” stated Zameen.com. All four major cities – Lahore, Islamabad, Karachi, and Gujranwala – experienced moderate changes and stability. Projects by big-name developers performed well in all four cities.
Lahore
According to the data, in Lahore, DHA Phases I-VI showcased stability for 1-kanal plots with a rise of 0.63%, and a moderate growth of 1.79% in 10-marla plots. This can be attributed to the rising number of homes being constructed in Phases V and VI by genuine buyers.
DHA Phases VII-IX showcased similar trends, with 1-kanal plots going up by 0.56%, and 10-marla plots going up by 1.25%. A significant amount of this increase is due to development work being undertaken in Phase IX.
Karachi
DHA Karachi remained stable with rises of 0.67% for 250 square yard plots, and 0.16% for 500 sq yard plots. This was because no major developments were announced there, and genuine buyers ruled the market.
On the other hand, DHA City Karachi experienced moderate growth for both 250 sq yard and 500 sq yard options. The former went up by 3.28%, while the latter increased by 3.09%. In the past few months, rates had been dropping, leading to an ideal situation for investors to come in and generate activity in the locality.
Bahria Town Karachi experienced downward trends, with 250 sq yard plots dropping by a moderate 1.81%, and rates of 500 sq yard plots going down by a stable 0.23%.
Islamabad
Plots in Islamabad’s Sector F-11 showcased moderate growth of 1.60% and 1.53% for both 10-marla and 1-kanal options, respectively. This is due to the fact that it is only 20 minutes away from the Islamabad International Airport, which has generated activity in the area.
DHA Islamabad, on the other hand, remained stable, with 10-marla plots going up by 0.20%, and 1-kanal plots appreciating by 0.23%. Its location away from the airport means that it does not get the attention localities around the airport are receiving.