Is now the right time to invest in DHA Gujranwala? Find out here!

The rising rates of plot files in Defence Housing Authority (DHA) Gujranwala has left many investors intrigued about investing in this project. A lot of people on the Zameen.com Blog have also asked me if investing in these files would be a wise decision to make. Please consider this blog an analysis on why the prices in this project went up at such stark rates and what’s happening right now.

First, let have a look at some of the factors that triggered price appreciation in DHA Gujranwala.

The DHA-Multan impact

The DHA Gujranwala is yet to an official launch. In fact, in many DHA projects that were conceived several years after this, the plots have been balloted with development work already initiated. So naturally, the market price of 1-kanal residential plot files in DHA Gujranwala continued to fare at a justified rate of PKR 2,900,000 for a very long time.

The situation, however, changed when strong rumours of DHA Multan’s official launch heated up the market. With rates seeing incredible climbs of PKR 1 million and more within months in DHA Multan, some of these investors monitoring DHA projects were bound to compare it with DHA Gujanwala. The comparison lead them to believe that DHA Gujranwala holds good future potential, causing a hike in demand for the DHA Gujranwala plot files.

Observing the price trends in DHA Gujranwala, I noticed that rates of these files started to ascend just before balloting took place in DHA Multan. With the price appreciation phenomenon taking a breather after the DHA Multan ballot took place, the rates started to, gradually and subtly, decline in DHA Gujranwala.

Land acquisition at higher rates

Landowners whose property fall within the area developers intend to buy for their upcoming projects have lately become more demanding in terms of asking price. Their demand increases if they see investment activity getting strengthened. In the case of DHA Gujranwala, issues with land acquisition among the DHA and landowners already existed.

With limited number of sellers willing to surrender their land for DHA Gujranwala and that too at higher rates, the cost of plot files was bound to increase. In addition to that, the DHA also reduced the number of plot files it issued against per acre of land its registered agents acquire. In such circumstances, the landowners or the investors, who exchange their land for files had no choice but to tag the plot files with higher rates.

The timeline coincided perfectly with the existing demand, and the market rate of DHA Gujranwala plot files went up.

The selling pressure

The dropped activity in DHA Multan brought along similar trends in DHA Gujranwala. For the investors who had gained decent premium on these files, it was time to bail out. This flooded the market with sellers and in such market conditions, property rates almost always decline. Even today, DHA Gujranwala has more sellers than buyers.

What’s happening right now?

The upward trend noticed in property rates in a particular project is itself a reason big enough to convince investors but if it isn’t backed by solid reasons, the phenomenon is likely to be only temporary. This happened with DHA Gujranwala, too.

As soon as the DHA Multan market started to cool off after the ballot held in May this year, the demand for and consequently the rate of DHA Gujranwala plot files also started to decline. After touching the PKR 5.2 million mark in May this year, the downward trend in rates of 1-kanal plot files started. At the moment, the market rate of a 1-kanal DHA Gujranwala plot file is PKR 4.7 million and decreasing. Similar decline is seen in the rates of 10-marla plot files; the market rate has dropped from PKR 3.1 million in May to PKR 2.95 million right now.

What to expect now?

Surely, market rates of DHA Gujranwala plot files is going down. Such volatile market conditions make it the worst time to invest because assessing the decline rate and duration is hard to predict. But one thing is sure, the rate will not drop to old price from where it started to inch up. The rates may or may not stop declining after they touches PKR 4.5 million mark for 1-kanal plot files.

According to the experts, the downward trend will not last for long. So if you are looking to invest in DHA Gujranwala, you should prepare for for that.

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