Pakistan’s Real Estate Trends 2013


Pakistan's Real Estate Trends 2013

Pakistan’s Real Estate Market trend has been bullish for last 3 years, which started in the last quarter of 2010 and continues till today in almost all the major cities Pakistan. Prices have escalated by 50% to 300% in different sectors/areas of Real Estate. Particularly, this year prices jumped to almost double in different segments and in three quarters of 2013 (Jan to Sep) prices escalated 25% to 75%.

Though the last quarter seems looks dull, and prices may drop down to 5% to 15 % in particularly open plots and those undeveloped area where only the plot has been traded for the investment purpose only. This price fall has not yet effected the developed area and constructed property like bungalows or apartments.

Here are some of the trends that the Pakistani real estate market witnessed in 2013:

  • Foreign investment in real estate increased by 10 to 15%.
  • Construction costs increased by 20% and are expected to remain the same until the end of the year.
  • Prices of built-up commercial and residential properties increased by 25 to 75%.
  • Prices of vacant plots that showed a bullish trend till September 2013 have now started to decrease by five to 15%.
  • Rental rates of residential and commercial property increased by 10 to 25% and are expected to increase by a further 15% within the next two months.
  • The availability of newly built houses increased by 10% and is likely to increase by five percent by the end of the year.
  • The establishment of gated communities increased by five to 15%, and many more are in the pipeline.
  • Interest rates on home loans remained the same as last year and range between 14.3 and 14.8%
  • The demand for, and value of, agricultural land increased by 15 to 20%.

Investment options that investors should consider include:

  • Industrial estates located along the highways.
  • Gated communities in Islamabad, Karachi and Lahore.
  • Vacant plots (residential, commercial and agricultural) located at the outskirts of the major cities; these are ideal for long term investment.

This article is written by Mr. Muhammad Shafi Jakvani, CEO – Citi Associates. You can get in touch with him at jakvani@gmail.com. This article was also published in DAWN Real Estate Advertiser.

Citi Associates – Real Estate Consultancy, Brokerage and Investment Services

Comments (5)

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  1. abdul aziz khan says:

    Valuable information

  2. Nice Analysis by muhammad Shafi Jakvani Sahib

  3. Aisha Choudhary says:

    Very informative

  4. Hassan Shah says:

    Salam,
    Sir any sugeastion on short term investment in DHA islamabad or Gulberg Greens, in the range of 8 to 9 million.
    Regards.

  5. Neha says:

    Property prices in Islamabad had a bit of a dry spell in the first quarter of 2014. Most
    of the
    Capital Development Authority (CDA) sectors, which were very popular in 2013, did not
    manage to
    register impressive appreciation.
    In fact, some of the most notable areas registered a fall in prices.
    E-11 exhibited a downward trend with a 4.85% fall in the prices of 1-kanal plots.
    Interestingly, however, prices of same-sized plots
    in F-11 told a different story, registering an increase of 14.10% and providing further
    evidence that there was some upward activity
    in selective pockets of the Federal Capital despite a relatively sluggish market. Homes,
    on the other hand, have had a much better
    2014 across the board so far. shelters.com.pk’s
    statistics showed
    that 1-kanal homes in F-11,
    G-11 and E-11 saw price increases of 15.36%, 10.44% and 5.56% respectively.
    From among the three most popular CDA sectors, E-11, G-11 and F-11, the first emerged as
    the most economical place to rent a 1-kanal home, with an average rental price of
    Rs 167,475 in Q1 of 2014 and an estimated rental yield of 3.46%. Rents for residential
    units of the same size hovered around the Rs 185,000 mark in F-11 during the first three
    months of 2014, and with increasing prices and steady rents, shelters.com.pk’s data showed a gradual drop in the sector’s rental yield.
    1-kanal homes in G-11 fared slightly better in terms of rent thanks to steady, albeit minute,
    increases. The sector boasted an average monthly rent of Rs 191800 in the 1st quarter and a
    steady 3.61% of rent yield

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