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Pakistan Real Estate 2020 Forecast & Investment Options for New Year

New Year And Challenges of Pakistan Real Estate

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Pakistan has a special geographical significance on the world map because of a lot of factors involved. With a population of more than 200 million, it is considered one of the highly populous countries in the world. Although many governments have proclaimed developmental projects to shelter the residents of this country, there is a huge number of people that are homeless and are deprived of basic amenities. In this regard, the real estate sector in Pakistan holds a crucial role in not only providing shelter for these homeless citizens but also uplifting the economic growth of Pakistan.

Investment in the properties do not provide shelter for living, however, it is the best resource for saving for a lot of Pakistanis.

It is a common observation that many local and foreign Pakistani investors are now losing their interest in the real estate sector due to the unstable economic conditions and weak investor protection laws in the country.

The ever-increasing population and urbanization call for rapid development in all cities, however, there is little attention paid by the government to address the issue. The budget for the construction is low and is not enough to meet the ever-increasing needs of the population. As a result, private developers have to initiate residential societies and schemes themselves to come over this deficit.

Keeping in consideration the law and order situation and other concerns pertaining to security in view, the private developers opted for a few major cities and areas for building gated projects. When the question of property sector development arises, the progress in real estate remains unanswered without two important projects – Defence Housing Authority and Bahria Town.

Pakistan Real Estate 2020 What to Expect from ?

Ther real estate industry in Pakistan had suffered a lot in 2019 due to many reasons such as political instability, unrealistic policies, and worsening economic conditions. However, the sector is still expected to see a boom of investments in the new year, 2020.

The government’s complex real estate tax policies and amendments are gradually getting clear for buyers and sellers. Moreover, there are various latest developments across the country, particularly in Karachi, Lahore, Peshawar, and Gawadar.

Top areas for investment-purpose in 2020

1) DHA City Karachi

Defense Housing Authority is another massive success in the paradigm of house schemes that are under the administration of the Pakistan Army and mainly takes care of the development of residences for military officers that are in-service and retired. Just like the aforementioned project, DHA has also extended its program to Karachi, Lahore, Islamabad, and other cities. The most recent projects are launched in Multan and Gujranwala.

Therefore, we recommend you DHA as a reliable option for investment in 2020. Particularly, we believe DHA City Karachi would be the best option to invest in the upcoming year.

2) Gulshan e Maymar

Gulshan e Maymar’s commercial area has shown a very impressive performance in 2019. Emphasizing over commercial sectors, investors earned a very healthy return against their investments in commercial areas of Maymar. The prices raised significantly, but still, it’s very much in demand. However, this is not the case if we talk about residential plots. The prices there went down after the first quarter of 2019.

So, we rank Gulshan-e-Maymar as our 2nd recommendation for investment in 2020. Maymar is one of the most popular areas of Karachi which is equipped with all utilities, nurtured parks, and great infrastructure.

3) Scheme 33

Scheme 33 is our third recommendation for the year 2020. Prices at Scheme 33 dropped significantly in 2019, therefore, either you’re a genuine buyer or investor, we suggest you invest in those societies of Scheme 33 where the lease is available along with all basic utilities such as water, electricity, and gas, etc.

4) Bahria Town Karachi

Bahria Town is the biggest real development in the country and has given the new concept of gated residential developments. Bahria Town is the pioneer residential society in the country which is free from power deficit and security issues. Many societies have come into being following the blueprint of this society because of its great facilities. For example, mostly gated societies for residential purposes are free from load shedding and have innovative security measures.

After its success in Lahore, the developer initiated the project in two other major cities – Islamabad and Karachi. Bahria Town Karachi is a massive success because of its elite lifestyle and security being offered to the residents. Moreover, economical options such as Awami Villas is a good option for those belonging to the middle and lower-middle classes.

Bahria Town, DHA, and other posh residential development schemes are playing an important role in the flourishment of the real estate sector in Pakistan. However, for strengthening and reviving the market of real estate, continuous efforts and plans from the government are needed for more stability and growth.

For the investments in the year 2020, unfortunately, Bahria Town Karachi is not in our list of recommendations apart from just phase I. We expect that Bahria Karachi will keep struggling in 2020 in terms of prices because of its land disputes. Secondly, Bahria’s customers haven’t received refund cheques so far. Thirdly, many people are still protesting for the allotment of their plots in the following blocks:

  • 29ABCD
  • 30ABCD
  • 31ABCD
  • 32ABCD
  • 33ABCD
  • Block Valley
  • Sports City
  • Paradise

Overall, we believe there’s very little chance of any progress in terms of prices in Bahria Town. For the long term, we recommend you to invest in phase I, otherwise it’s a big risk to invest anywhere else in Bahria Town Karachi.

Our Advice for Real Estate Investors in 2020

As a real estate investor, you explore several asset categories of real estate to make your investment, such as residential land, homes, apartments, commercial offices, multifamily, industrial and farmlands. All these asset categories are tangible assets unlike just a piece of contract or paper. We advise you to not invest in misleading products and documents claimed to be real estate but has no value in actual.

It’s better to invest in less-popular neighborhood where the price will appreciate only by 10 to 15 percent in the next 4 to 5 years as compared to purchasing a piece of document. The document which will only give you a contract to build a home, or even if it’s a home, the document will only give you a contract to live and have a possession of your property by fulfilling unjust and strict conditions of a master, against whom you can’t take any legal action in case he doesn’t oblige. So, be a real estate investor, not a gambler, and invest in real assets rather than putting your hard-earned investment on the piece of paper.

Happy New Year & Happy Investing 🙂

Wishing you a peaceful and joyful New Year!