The global economy is massively hit by the ongoing pandemic, Covid-19. Surprisingly, this pandemic has turned out to be a blessing for Pakistan’s real estate industry. The real estate and construction industry has been in the limelight after the government showed these industries as its major focus to revive the economy. In the current situation, it has become essential to identify suitable projects for lucrative investment. The government is also allowing to invest undeclared money in the real estate or construction sector through the recently announced construction relief package. The conditions to avail this opportunity are as follows:
- The registration at the FBR IRIS web portal is mandatory for all those interested to invest under this scheme.
- The construction work must start before 31st December and the owner is bound to complete it fully before Sep 2022, if undeclared money was used to buy this plot in possession.
- For investments in a high rise in installments. If invested undeclared money, you’ve to invest before the 31st of Dec 2020. You are also entitled to complete the grey structure by Sep 2022.
- If you’re looking to invest in plots on installments, you’ve to make an investment before 31st Dec 2020. Moreover, the construction of road infrastructure and half construction work should’ve completed before Sep 2022.
- All transactions must be done through banking channels, using Pay orders or Cheques.
- Under this scheme, you can also start your own project or acquire an existing project on the partnership, etc.
- Just being able to invest undeclared money is not enough, you’ve to be efficient enough to understand where to invest to make a profit out of it.
Should you take advantage of this scheme?
We highly recommend you all to take advantage of this scheme. By investing in this scheme. You will not only be exempted from taxes but you will eventually make a profit against your investment. It’s a win-win situation without any doubt. The real estate prices in the country have been falling for the last 4 years and are already mature for investment purposes. We believe this is the right time to invest in real estate as experts are predicting an overall increase in prices of real estate between 2020 and 2025.
Covid-19 followed by the construction relief package by the Govt is going to act as the catalyst and marks the end of the real estate downward cycle in Pakistan.
Adding more to these steps, the government has also decreased the transfer costs of real estate and kept DV values minimal. KIBOR is also decreased by 8% and we believe it will decrease further to 6%.
The scenario is not only favorable for those who have undeclared money. Even if you don’t undeclared money, you can still take advantage of this progressive trend through amnesty and enjoy healthy returns against your investments.
Where should you invest in real estate?
The answer to this question entirely lies in your personal preference and market situation. The real estate industry in general is going to see a boom in for the next years at least. However, we cannot reject the possibility of some areas outperforming others in terms of better and early returns.
Here are the general guidelines that help you understand the best options available as per the current market situation.
DHA CITY KARACHI
In January 2020, we’ had discussed that DHA city is one of the most preferable options to get good returns on investment. DHA City has shown remarkable improvement in the beginning. There was a jump in the prices for around 4 to 5 lacs. Initially, there were active buyers in the market and sellers were comparatively less. After COVID 19, when the market becomes stable, the prices didn’t decrease as expected. The reason is there were limited sellers as well as limited buyers. After the lockdown ends, the DHA City market again showed very significant progress. The prices saw the jump of around 5 to 10 lacs. There were ample buyers in the market as well and the reason behind this active presence is the announcement of the construction package by the federal government. Later on, the market saw a slight downward trend and prices reduced to 3 to 4 lacs.
Overall, DHA city is still an ideal project for investment. It’s safe, reliable, and legal. Some of the attractive dimensions and sectors for investment are as follows:
- 500 sq yd in the yellow zone
- 300 sq yd in sector 14 and 4
- 200 sq yd in sector 6D,9D, and 13
- 125 sq yd in sector 14B
These options can give you good returns as early as 6 months to 1 year. However, they will definitely give you healthy returns on long-term investments as well.
As per our prediction at the beginning of 2020, the commercial market of Gulshan-e-Maymar has performed great. Even during the pandemic and lockdown situation, the commercial sector of Maymar saw good increment and investors get healthy returns against their investments. We also reported that residential prices were down so it was the best time to invest back then at the beginning of 2020.
The prices in Maymar has improved as compared to 2019. There is a difference of around 10% due to COVID 19 in a residential area but still, we highly recommend Maymar for short and long term investments. Secondly, Maymar has plots ready for possession belonging to both residential and commercial sectors. You can also take advantage of the PM relief package to invest in Maymar. Maymar has recently seen development in terms of roads, parks, street lights, and security.
Overall, In Maymar, the residential area is highly recommended at the moment if you wish to earn handsome returns of Investment. After residential, the commercial sector is also a very good option as a number of well-known builders are going to launch their projects. Other major projects started in Maymar is Maymar pride, Saima, and Lakhani.
The best options as per measurements are as follows:
- For 120 sq yd, sector Q
- For 240/200 sq yd, Sector R and T
- For 400 sq yd, Sector S, W, T
- For 600 sq yd, Sector S, W
For commercial, you will get handsome returns regardless of the plot size you opt for.
In mid of 2020, Garden city saw an excellent improvement. There were active buyers and sellers. Garden City is basically located on the backside of Sector Q of Gulshan e Maymar. The project has plots ready for possession and all utilities such as electricity, gas, water is available there. There are a number of families residing In Garden City Block A. Moreover, further construction is also in progress in this sector.
So overall, we can say that Garden City is a safe investment in 2020 in terms of land title and documentation.
Taiser Town was started as a residential and commercial housing project by Karachi Development Authority (KDA) back in 1986. After ten years of its launch, the project was handed over to Malir Development Authority (MDA) in 1996. MDA launched this project once again in 2005.
Taiser town is basically located in the northeastern part of the city near Dreamworld resort and Gulshan-e-Maymar. The project covers an area of around 21,000 acres and expected to house almost 2.5 million people after it’s fully developed.
Taiser Town is a well-planned scheme. The project has been designed by well known Engineering Consultants International Limited (ECIL) and includes a variety of facilities and amenities. The project has reserved area of around 9,500 acres for parks and other recreational avenues for families. The project also incorporates a commercial avenue alongside Karachi Northern Bypass. This bypass passes through the society due to which an easy commute is available for residents and there are ample business opportunities for investors in the commercial sector.
Taiser Town has been initiated to provide a low-cost housing scheme for mostly middle-class community and for the people who can’t afford a plot in other developed and expensive areas of the city.
If you’ve less investment of around 2 to 5 lacs, and you wish to invest it safely and securely, Taiser Town is the best option for you. Let’s say if you purchase 4 files with an investment of around 20 lacs. Each file can easily earn you a profit of around 10k to 15k, which means you can get an instant profit of 40k to 60k by trading. In fact, if you’re looking for long-term investment, still Taiser Town is not a bad choice to invest in. Every broker in Karachi is working for Taiser Town these days therefore due to high demand, it’s convenient to sell files in no time.
We’ve recommended Scheme 33 at the beginning of 2020. Scheme 33 is still a hot cake in Karachi’s real estate. But again reiterate, if you opt for Scheme 33, please verify the society with complete information before making any investment and only invest in authorized societies. Some of the authentic societies in our top recommendation from an investment point of view are as follows:
- Gulshan-E-Kaneez Fatima
- Karachi University Housing Society
- Pir Ahmed Zameen
- Pir Gul Hassan
- Saadi Town
- Saadi Garden
- Karachi Bar Cooperative Housing Society
- Gwalior Cooperative Housing Society
- Punjabi Saudagar Society (Phase 1 , 2 & 3)
- Pak Air Crew Society
- Pilibhit Society CHS
- Pak Scientist CHS
All the above-mentioned societies are authentic and you can invest in their residential sectors. They have the potential to give you good returns against your long-term and short-term investments. As all of these societies offer possession, you can also take advantage of the construction relief package in Scheme 33.
Scheme 33 will best in short term 6 months to 1 year and long term 3 to 5 years. The midterm perspective may not be that lucrative but chances of speculative trading are still high.
BAHRIA TOWN KARACHI:
We are not confident about Bahria either for short term or long term investment except phase I. Overall, we believe there’s a very slight chance of any improvement in the prices of Bahria. For the long term only, we recommend you to invest in phase I, else it’s up to you.
What should be your pick?
In general, we believe real estate is going to boom. However, to get maximum out of the situation, we recommend you to invest in the vicinities which are covered by the construction relief package.
Tax filers with white money
- If you’re a tax filer with white money, there’s nothing to trouble you. You can easily invest anywhere you wish. You do not need to build plazas or construct houses to settle your money. You can simply purchase a plot and enjoy its appreciation over the passage of time.
- If you are interested in short term trading, we recommend you to go for possession plots and high-end apartment projects.
- If you’re interested in 2 to 3 years trading period. Still, we recommend possession plots in Gulshan-e-maymar, garden city, scheme 33 and DHA city sector 3
- In case you are looking to invest for a 3 to 5 years period than investing in non-possession areas such as DHA City is suitable.
- Our recommendation for long term investments beyond 5 years are Gulshan e Maymar, DHA City and any high-end apartment projects
2.Investors with undeclared money
- This is the best time for you to build a house or commercial for yourself. Take advantage of the situation. Search a suitable possession plot and initiate construction before 31st Dec 2020.
- If you’re solely interested in investment, then commercial plaza is more suitable for you. A commercial plaza will give you a stable rental income but also appreciate if you keep it for a longer period.
- We recommend you go for a construction project and plots on installments instead of possession plots for solely investment purposes to build houses. This option will give chance to invest over the next 4 to 5 years and if you’re in business, you can even have amnesty over the money you invest in the future. Remarkably, you must make a deal before Dec 2020.
- You should opt for under-construction projects which are halfway complete rather than new ones.
- We recommend you to avoid Non-possession plots files.
For any further real estate investment guide, please feel free to contact us at
- Address: Office # 1 , Building # 113-C , Near Tooba Masjid , Phase 1 , DHA , Karachi
- Mobile: +92-321-2222990
- Email: email@example.com