During the year-long reign of Pakistan’s current pro-business PML-N government, property rates in Pakistan have reached new highs. The increase in property rates continued throughout 2013 in the three major cities of Pakistan, however, the gains in prices slowed down a bit during the first quarter of 2014, where the market largely remained stable.
Islamabad property market after PML-N government took charge
Zameen.com’s market report for 2014 showed a mixed picture for the Islamabad property sector, as prices here remained mostly steady in all but a few areas.
F-11 remained one of the most promising areas of the Federal Capital where, during the first four months of 2014, price trends for 1-kanal plots stayed bullish. The overall property market of Islamabad did not experience any sharp price hikes in 2014 but continued to register stable numbers. The property market entered 2014 without making a big show, with the exception of Sector F-11 of course, where the value of 1-kanal plots increased by 10.14% in the first four months of 2014.
For Bahria Town Islamabad, matching the performance of Sector F-11 turned out to be an impossible task; the average sale price of 1 Kanal plots here instead dropped by 18.87% between January and April 2014. For many investors, seeing Bahria Town property rates go down was a rather shocking thing to experience because the locality seldom witnessed such trends in the past. Property rates in E-11 also suffered the blow of the slow real estate activity and rates of price escalation here reduced considerably.
As compared to the performance of residential plots in the capital, the housing sector performed well. Rates of 1 Kanal houses in notable sectors of Islamabad including E-11, G-11 and F-11 went up. Value of 1 Kanal houses in G-11 increased by 43.28% since May 2013, while the price escalation seen in same sized houses of E-11 and F-11 was rather modest at 24.61 and 11.32 respectively. The rental market also registered sound stats in the first four months of 2014.
Karachi property market’s response to the investors’ call
The Karachi real estate sector has not performed any less exceptionally in the last one year than the property markets of Islamabad and Lahore. For the first time in the last few years, the law and order situation in the city failed to batter down the demand for property and the rise in its value. Just like Islamabad and Lahore, the property rates in Karachi registered consistent rises in select localities, while the overall trend remained largely stable.
During the last one year, 1-kanal plots in DHA Karachi remained bullish and average property rates jumped from Rs 21,952,083 in May 2013 to Rs 28,091,641 in April 2014, which is a 27.96% jump. Such exceptional growth in the value of 1-kanal plots in DHA depicts investors’ faith in the future of the city in general and its property sector in particular.
Plots in Gulistan-e-Jauhar and Gulshan-e-Iqbal have also had a great year ever since the new government took charge in May 2013. It is believed that demand, and consequently the increase in value experienced by Gulistan-e-Johar and Gulshan-e-Iqbal, is also because of the limited availability of the land here. The price graph will give you an idea of the sort of growth these localities have experienced since May 2013.
Clifton, being the most promising locality of the city in terms of rental yield, has unsurprisingly registered some very sound stats in the last year. The average rental yield for 1,125 square-foot apartments in the locality during 2014 was calculated to be 5.98%. This figure is the year’s highest for any residential area in Pakistan.
Lahore property sector since May 2013
DHA remains the most popular locality in Lahore. After the General Elections of 2013, property rates here increased sharply and the value of 1-kanal plots jumped from Rs 11,807,331 in May 2013 to Rs 12,271,572 in June 2013. By November 2013, their value had increased another 21.75%. From December 2013 onwards, DHA property went through a correction phase which continued through the first four months of the year.
On the contrary, value of property in Bahria Town continued to increase consistently with little or no effect of the change of government or the budget that followed. The value of 1-kanal plots in Bahria Town increased by 16.50% between May 2013 and April 2014, and saw little ups and downs in the intervening months.
The year 2013 turned out to be an exceptional one for WAPDA Town and LDA Avenue 1, and these societies saw decent price increases with progressive infrastructure development. For LDA Avenue 1, the end of the first quarter of 2014 brought along a noticeable price increase in plots of all sizes, especially smaller ones.
The housing sector in Lahore has a similar story to tell. The Luxury Tax that was likely to bring the demand and value of bigger houses in Category A areas down had an altogether different effect in Lahore. Between May 2013 and April 2014, value of 2-kanal houses in DHA Lahore increased by 19%, while prices for 1-kanal houses went up by 16.36%. The rent for these 1-kanal houses increased by 54.02% in the last year.
The property market in Pakistan is likely to pick up in the second half of 2014 primarily because a lot of overseas Pakistanis will return home for Eid. As seen in the past, these Pakistanis show a great interest in the property sector and thus give property buying and selling a noticeable boom. Real estate analysts and experts, too, foresee a very happening latter half of 2014.
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Dear Samra Zulfiqar,
How do you see the future of RCCI Rawat…?
Regards
Dear Javed Malik,
To discuss future of certain projects, i would recommend you to talk to those working in the field and Zameen.com’s forum is where you can find such experts.
Have a good day Javed sahb.
How do u see DHA lahore Phase 5, 6 and 8 in next 6 months
DHA property sector has its own world, where more than the political situation, property demand determines the fluctuation in rates. Property rates here, when go markedly up, come across a correction phase. So, i believe, next couple of months could see some nice rise in rates followed by a correction towards the end of the year, where property rates are likely to drop only marginally.
Asalamualikum.wat r the expectations in thefuture?becoz i heard in pml-n government property remain cool and is not to much profitable.will we wait for next 4 years or are there any expectations of rise in the profits in property?also give an idea about walayat complex bahria town phase 7 please
Property after 4 years will be a lot more expensive than it is today, which means you need to make purchase now. If you wish to sell, you should know that there are people who believe that Pakistan’s property sector is likely to go through a boom in about five years which will be the greatest in the history of Pakistan, Allah knows best. About discussing the prospects of making an investment in Walayat Complex, Bahrai Town, i would recommend you to consult Zameen.com’s forum.
Great informative post! Although this graph showing the mixed behavior of property sector in Pakistan if we see the overall scenario of trends of property buying and selling it is gradually increasing. Thank you for such great informative post here.