If you are a real estate market entrant, you may be wondering how to sell property in Pakistan. The task, as has long been the complaint of many a property affiliate in the country, can seem like a difficult one.

Now the good news is that you no longer need to worry about this problem. This blog, which will likely have you coming back for quick check-ups every now & then, details everything you need to know to transfer property in Pakistan.

So how exactly do you go about transferring and selling property in Pakistan?

Well, you start off by knowing what exactly constitutes a transfer of property – as it is understood in the country.

As in ‘what the process entails’.

What does the transfer of property even mean?

Legally speaking, someone owns a property when he (or she) possesses a ‘title’ for it. In Pakistan, a transfer of property basically comprises the transfer of the title of a landholding from one person to another.
This transfer can take place in a number of ways, and doesn’t merely imply a sale. It can also include the concerns of mortgage, gift, lease, and exchange.

Additionally, there can be different kinds of properties involved in the process.
But real estate usually only deals with immovable properties. Though ‘plot files,’ as they work in the system, could be considered a kind of movable property.

 What is an immovable property?

An immovable, in legal parlance, is a type of property that cannot be moved without altering its nature. It is fixed to the earth. This category can include plots, houses, apartments, shops, and all types of built buildings or structures.

Who can transfer property in Pakistan?

Anyone who is competent to contract

Only someone who is able to sign a contract can, legally, transfer property. Under Contract Act 1872, a contract is ‘a binding agreement between two parties’.

The following cannot not be a party to a contract:

• A Minor. In Pakistan, currently, this is anyone under the age of 18.
• Someone who is unable to understand the consequences of his action. This may be due to a permanent or temporary mental disability, or other similar reasons.
• Someone legally barred from signing a contract.

Therefore, it follows that only someone above the age of 18, who is mentally sound, and not legally barred from signing a contract, can transfer property in Pakistan.

The procedure for transferring property in Pakistan

1. Token and Bayana

This is usually the first step involved in the transfer of property. The potential buyer pays a ‘token’ amount to a seller,  in order to indicate willingness to purchase. This is followed by detailed discussion, negotiation, and a series of practical steps for buying property..

Resultantly, the seller temporarily stops negotiating the sale of the same property with other potential buyers. If the sale falls through, the token gets returned, with appropriate deductions.

The token is usually followed up with a bayana. This instrument serves the same purpose as the token. However, unlike the latter, it makes things slightly more official, as it usually comes coupled with a written agreement.

Below, we’ve listed the details of the property sale agreement form format in Pakistan. This is attached with the bayana, and includes:

• The complete details of the property
• The terms of sale of the property
• The total amount of money (in consideration of which the seller agrees to transfer)
• The date on which the buyer is bound to pay the remaining sum (after bayana and token)

2. Required property documents in Pakistan

To follow through with the transfer, you will first need to get all your documentation in order. Consider this checklist:

• Recent photos of the two parties involved (buyer and seller)
• Copies of their National Identity Cards (NIC)
• Original title deed of the seller. The title deed is the document that proves the ownership of the seller.
• The ‘Sale deed’. This is the agreement (contract) signed between the buyer and the seller – largely considered the most important property document in Pakistan.

The transfer process may require some other documents, depending on the concerned property’s location:

• The Fard-e-Malkiat (Record of Rights), also simply known as the ‘fard’. The seller can obtain this form from the property registration office. It is a guarantee (from the said authority) that the property belongs to the seller.
• A Non-demand Certificate (NDC). This document shows that you don’t owe any dues on the property. Depending on the property’s location, you can get it from your local development authority office.
• In case you’re interested in a property located within a private housing society, you normally also require a letter from the society to affect transfers. This basically acts as a replacement for a fard document. You need it before you can execute the sale deed.

Societies generally make for the transfer process a lot easier for sellers and buyers. Normally, they have a detailed system in place to facilitate this end.

Recently, the news that internal transfers in housing schemes will stop made headlines in local real estate circles. According to the reports, a Board of Revenue (BOR) transfer mechanism will cater to all cases of property resettlement. But till date, no concrete steps have been taken by the government to this effect. As per the property experts interviewed for this piece, the matter is still under consideration.

Hassan Basra of Kings Real Estate says that the primary concern of the government, at this point, is taxes. The government is also determined to stopping the operation of illegal housing schemes.

All housing schemes, however, need to maintain a record of transfers. So any implementation on this front will necessarily have to involve their administrative functions.

3. Acquisition of stamp paper and payment of taxes

Finally, you need a stamp paper for drafting the sales deed: the contract for sale. The value of the stamp paper required will differ depending on the value of the property it concerns.  To follow through with this step, you (as a buyer) will also need to pay all due taxes.

Take note of the following tax breakdown:

• 3% Stamp Duty
• 2% Capital Value Tax
• 1% District Council Fee
• Fixed registration – usually PKR 500

Read: Everything You Need to Know About Taxes on Property in Pakistan

4. Writing the sale deed

It is generally recommended to hire a deed writer or a lawyer to write the sale deed. They have experience and they know the things that are absolutely included in any deed. This can generally help avoid any future complications between the parties.

However, it is not compulsory. You can as easily pen down the deed yourself. Property sale agreement formats for Pakistan are conveniently available online. You can find them on the Punjab Land Record Authority’s Registration of Deeds portal. And you can find them below as well:

• Sample sale deed format (general)
• Sample property sale agreement format in Pakistan. (Also usable for plot transfers)

5. Execution of Sale deed

Finally, you need to take the sales deed-inscribed stamp paper, along with all the requisite documents noted above, to the sub-registrar’s office. Here, a magistrate/sub-registrar hears both the parties involved in the trade-off. Once satisfied with the proceedings, the said official approves the transaction, and registers the deed.

The property is now the legal possession of the recipient.

Some helpful Tips

The guide laid out above takes you through the basic process of transferring property through a sales arrangement. A newbie looking to buy or sell property in Pakistan, however, may have some other questions weighing him down:

• How do you go about finding the right kind of property dealer?
• What is the general property dealer commission in Pakistan?
• How do you identify the right property option for investment?
• How do you determine the right price for selling property in Pakistan?
• Is there a set range for reasonable property prices in Pakistan?
• What precautions should one take when buying property?

Property Prices in Pakistan

If you want to know the property rates in your area, please consult the  Zameen property listings page. This resource will allow you to compare property prices in Pakistan, in your city, and even in your neighbourhood. .

Property dealer commission in Pakistan

There are no specific laws that govern the work of real estate dealers and agents in the country. As a result, property dealer commissions in Pakistan are really a matter of custom, and are highly variable.

The usual practice for real estate agents is to demand 1% of the value of property – each from the buyer and the seller – as commission. If both the buyer and seller have different agents, each agent will keep the commission from his own client.

Sometimes, agents’ fare may go as high 2% of the value of property. Or they may be happy with a much lower (fixed) amount; regardless of the property price.

Finding the right property

If you are a buyer, and are looking to buy property, know that your research may make all the difference. It can help you find the right kind of property at the right location, and with the amenities you need.  The listings page is a good place to start off on this venture.

Check out the property listings for different areas, projects or housing schemes, and compare the prices given. Read the descriptions, and go through any photos and videos provided. You can also call or email the agents/owners who listed their properties to discuss your options.

Once you have narrowed down a few good choices, it is highly recommended that you go and visit their sites in person. This step will help you determine how good the location is, and discover all the amenities nearby. Also Consider meeting up with the agents, society representatives, owner and/or neighbours there while you’re at it.

Finally, confirm that there are no issues with the property in question.

As a further recommendation from our end, read these blogs:

How to choose the right real estate agent for help with investment

FBR’s guidelines on how to secure your real estate investment

LDA’s checklist for buying property in private housing schemes

Guidelines for buying open land in Gwadar!

Do you have any other questions refarding the sale or transfer of property? You can share them with us in the comments section below. Alternatively, you can also head on over to the Zameen Forum for a detailed conversation  on the topic.