The existing Pakistani Real Estate Market trend has been bullish since the last two and half year. In some parts of the country, prices have escalated by 25% to 200% in the last couple of months.
Keeping in view the recent political scenario in the country, the forecast for the next fiscal year (July 2013 to June 2014) is as follows:
- The overall economy is expected to improve, in turn boosting the construction business as well. The percentage of newly developed residential and commercial projects is expected to go up by 15 to 20%.
- The availability of new residential homes is likely to increase by 10%. Commercial property expansion will rise by 15 to 20%.
- As a general trend, the increasing property demand augments the construction cost as well which is likely to go up by 20%.
- In view of the positive market growth, investment from foreign companies will increase in the real estate sector by 10 to 15%.
- There will renewed interest in Agriculture land; the demand and value of which will increase by 15 to 30%.
- Development of new industries is expected across various segments hence the demand and value of industrial land will increase by 15 to 30%.
- The buying power will go up by 35% in view of the overall improved economy.
- Purchase prices of houses, apartments and residential plots will increase by 20 to 50%. Rental rates will escalate as well by 10 to 25%.
- Purchase prices of commercial property will increase by 25 to 40%. Rental rates will escalate as well by 10 to 15%.
- The interest rates on home loans will remain stable at 14.3 to 14.8%.
Some of the opportunities for the government to improve the real estate sector include:
- Development of highway properties to establish industrial estates.
- Review of Collector Rates % to match with the existing market value of property.
- Development of large scale affordable home projects.
This article is written by Mr. Muhammad Shafi Jakvani, CEO – Citi Associates. You can get in touch with him at email@example.com. This article was also published in DAWN Real Estate Advertiser.