Lahore, Karachi show mixed picture in February as Islamabad depicts stability

After a largely positive January 2016, the general hope was that February would bring along even more overwhelmingly good news for Pakistan’s real estate sector. While this hope did not materialise across the board, promising price ascents were seen here and there. Luckily, there were no jarring plunges, according to the real estate stats maintained precisely by Zameen.com.

Lahore’s property market experienced an unexpected anomaly – a sharp rise was observed in property values in Bahria Town Lahore even though this locality has been embroiled in controversies lately. Otherwise, the city index followed its usual growth pattern.
The federal capital’s property market posted less-than-ideal numbers during February 2016 and clung on to mere stability. The controlled
rises seen were few and far between.

Karachi, the city that has excited us for many months now, fared rather well this month, too. A sharp rise in Bahria Town Karachi (BTK) is worthy of note, but DHA City Karachi (DCK) failed to impress investors this time around. Overall, the market posted largely positive numbers.

Zameen.com’s popularity index picked up on some changes, too. Lake City knocked LDA Avenue I out of the list of top five localities for plots in Lahore, while Bani Gala could not make it to the list of popular localities for homes in Islamabad, something it had managed to do for a couple of months.

For detailed price and search trends meticulously observed in the three major cities, as well as our insightful final analysis, please peruse this Market Report on Pakistan properties.

Lahore

Lahore’s property market experienced a generally positive February 2015. In an interesting twist, Bahria Town registered a sharp 5.16% rise for 1-kanal plots. This ascent comes completely out of the blue, because the locality is still dealing with the fact that the Lahore Ring Road (LLR)’s southern route may very well cut through it.

DHA Phases I to VI and Wapda Town sailed through the month and posted healthy, controlled growth in 1-kanal category. DHA Phases VII to IX registered a price rise of 1.43% for 10-marla plots.

Conversely, LDA Avenue I could not excite investors too much this month. Stability was the order of the day for 1kanal plots, even though 10-marla plots managed to see a controlled growth of 1.30%.

1 kanal

10 marla

Islamabad

As mentioned in the Overview, the federal capital’s property market languished during February 2016 and registered lessthen-impressive numbers. Prices in all major localities, including DHA Islamabad, Bahria Town and Sector F-11, remained stable. Sector E-11 and DHA Islamabad were the only localities that managed to post controlled growth. However, we are not too worried about this situation as no jolting plunges were observed. Stability can pave the ground for excellent ascents, and we are hopeful that this market will gain some momentum in the months to come.

1 kanal

10 marla

Karachi

For the large part, the city by the sea continued its bellowing ascent during February 2016. As we saw it coming, BTK posted a sharp rise of 5.38% for 500square yard2 plots, while DHA Karachi registered controlled growth of 1.69% and 1.63% for 500square yard2 and 250-square yard2 categories respectively.

An anomaly observed in Karachi’s generally booming property market was DCK, where prices remained stagnant, even though this locality has been performing really well for the past year. Similarly, Gulshan-e-Iqbal also put forth sluggish numbers this time around.

500 square yards

250 square yards

Final Analysis

The obvious highlight of February 2016 was the performance of Bahria Town in Lahore and Karachi. Although the issue of the LRR cutting through Bahria Town Lahore still awaits resolution, investors seem to be adhering to the belief that property prices in unaffected blocks will increase manifold once the LRR project has been completed. This is probably why investors are channeling their money into this locality right now. Bahria Town Karachi, on the other hand, is performing well for another reason: the developer has been carrying out development work at a good pace, which has attracted investor interest once again. Even though this project saw continuous drops over the last few months, it seems to be on the right track now.

Karachi, as expected, largely did well. The improvement in law and order has effectively played its part in bolstering the city’s property sector and regaining investor trust. Needless to say, we expect this ascent in prices to continue in the future as well.
As the numbers show, Islamabad’s property market failed to perform well during the course of February 2016. However, this does not mean
that projects in the federal capital suffered any major drops in investor confidence. At this point in time, investors have perhaps adopted the wait-and-see policy in a bid to make the right decision at the right time.

“Lahore and Karachi are currently cradling plenty of good investment opportunities. A few patches of sluggishness here and there are not necessarily alarming, as they can be indicative of good times ahead,” said Zameen.com Chief Executive Officer Zeeshan Ali Khan.
“We are hopeful that the completion of the New Islamabad International Airport will bring about an increase in sale-purchase activity, which will consequently raise property values in the federal capital. As all major societies in Islamabad have matured, stability in prices should not be a cause for long-lasting concern. The city still has massive investment potential,” he added.

With a generally positive second month, we are truly excited to see how the rest of the year unfolds for Pakistan property. This is undoubtedly a stimulating time to be in the real estate game.