DHA City Karachi (DCK) has been envisioned as ‘The First Sustainable City of Pakistan’, which will serve as a model for the future independent cities in the country and abroad. The aim has been to plan and build a city, which provides its citizens a safe, comfortable, efficient and beautiful lifestyle.
After almost five years of its launching (2009 to 2014) and particularly after the marketing campaign by DHA Karachi, now DCK is a very well known project of DHA Karachi. This kind of housing project already created successful examples in other part of the world, but in Karachi it is first time ever in the history that almost 40 kilometers from the city center a huge city is going to developed.
In the year 2009 when the project was launched and first time ever in the history of DHA Karachi, they also provided opportunity to civilians to participate in balloting and offered large quantity of plots to the civilians. Though there was difference in the price and payment schedule for Armed Forces and Civilians. DHA also catered its staff persons and give them plots in different benefit structures.
In DCK there are many categories of plot with different payment plans and for the price calculation we have to follow the payment plans. Ongoing market price is also calculated on the basis of the principle price of the plot. As in DCK plot are traded as “ON Money”. As my personal opinion this word is not correct and many people write this word as Own Money. Actually it is Price Premium on the actual price.
Because of ON Money, it is very difficult to understand the total price of the plot in different categories for a common man, and specially for new comers who want to invest in DCK for the very first time.
For the understanding of all this we have already written a complete article about How to Buy a Plot in DHA City Karachi (DCK). Still it is very confusing to understand in different categories. Because of all this I already recommended this thing just after the balloting in April 2013 that we should consider the price of plot as whole (Principle plus ON Money) and made the transaction as a whole, minus the remaining payable amount to DCK at the time of full payment.
Now we have almost reached July 2014, almost 50% payment has been made in Civilian and Army Retired Officer’s category plots, and 25 % in Army Serving Category plots. It is recommended that we all should consider the price as whole principle plus the price premium.
Currently we assume that 500 square yards plot ON Money is around PKR 18 Lacs to 38 Lacs for Civilian Category. Now we calculate the total price by adding the principle price which is fixed PKR 19.15 Lacs for 500 yards plot.
Now we have to calculate paid amount and remaining amount. As of June 2014, the paid installment in this category is 18 Installments plus down payment i.e. total of Rs. 9.5 Lacs. Buyer will pay the remaining amount to DHA.
For Army Category, we assume 500 yards plot ON Money is around PKR 24 Lacs to 45 Lacs, plus adding principle price of 10.15 Lacs. At the time of payment buyer has to pay the ON Money and the paid amount which is PKR 2.45 Lacs and PKR 4.5 Lacs in serving and retired categories respectively.
Now we recommend that we should consider the full price of 500 yards plot from PKR 36 Lacs to 55 Lacs. In this case price variation is based on sectors only. And buyer has to pay full price besides the remaining installment.
Old Price Calculation Formula (Based on ON Money):
New Price Calculation Formula (Based on Full Amount):
This new price calculation formula will be workable for all sizes and categories of plots. We will quote the full price and buyer has to pay full amount besides the remaining installment of DHA and surcharge will be deduct from the full price as well.
In this case the maximum price will be for the Red Zone sectors and minimum price for Green Zone sectors irrespective of the categories. By not using this terminology of ON Money, will create positive impact on the market and buyer feels more comfortable to buy DCK plots.
In many people mind this ON Money word creates confusion and people are not ready to pay this ON Money. In DHA Karachi (Phase I to Phase VIII) plots have been allotted to Armed Forces people at very low price, and many of them already sold these plots to civilians.
In the market all of us consider full price, and nobody use the word ‘Profit’ on that plot. Though there is a difference of full cash and installment plan. But at this stage when almost 50% payment has been made to DHA City Karachi we should consider the full price for DHA City plot as well.
In this regard, it is requested to all that please share your precious feedback that should we go for this or follow the same old price method. Do share your feedback via comments below.
This post is written by Mr. Muhammad Shafi Jakvani, CEO – Citi Associates.