Pakistan Real Estate 2023 – Analysis, Forecast & Investment Options
The real estate industry is one of the major and fastest-growing industries in Pakistan. The country spends over $5 billion in construction work annually. Today, we are going to analyze the Pakistan real estate 2021. We will discuss and predict the performance of the real estate market considering the current situation and possible future events.Despite the fact that the real estate market is growing drastically in Pakistan, the country still lacks basic living facilities, i.e house with necessary living facilities. This fact indicates that there’s still wide room for growth in this sector so that people belonging to every class of income can afford a respectable living for themselves.
Pakistan Real Estate 2021 Investment And Budget 2020-21
The government believed that the budget they present is tax-free and this is a significant achievement amid the worst economic situation of the country. However, the opposition parties criticized the budget on charges that it could not handle the ongoing financial crisis.
The budget was said to be a big economic booster, but the boom will collapse ultimately and the real estate sector will continue to decline.
The freely falling Economy
The budget 2020-21 presented by the PTI government is merely paperwork far away from ground realities. As per IMF, Pakistan’s economy is expected to decline by 1.5 percent in 220-21, while the government’s estimate is up by 2.1 percent. If we consider the government’s inflation target of 6.5, the real GDP decline will be 4.5 percent.
COVID-19 and Locust Attack acted as the final nail in the coffin of Pakistan’s economy. Unstable border conditions are another misery to the economy. The unreliable political and economic situation is further discouraging people from investing in real estate.
The Record High Debt to GDP Ratio
The property market was enjoying a boom in 2003 and 2013. The debt-to-GDP ratio was declining during both boom periods. In 2003, the Debt to GDP ratio was 50 percent, while in 2013, it was 65 percent. However, the debt to GDP ratio is 86 percent at the moment and still rising. So, we don’t have high hopes about the prices of real estate in Pakistan at least in the near future.
Declining buying power; rare end-users in the market
The local Pakistani professionals, businessmen, and expatriates are the potential customers of the real estate market. However, the declining purchasing power of these local Pakistanis is one of the many concerns of the real estate sector. On the other hand, Gulf countries have passed a law asking private companies to reduce the salaries of overseas workers by 40%. By this ratio, the remittances in the year 2020-21 are expected to decrease by around $5 billion, the amount is equivalent to what the government required to build 1 LAC house. In simple words, bad days for our real estate will continue.
Economy & Future Of Real Estate Business In Pakistan
After 75 days of closure due to the COVID-19 lockdown, production throughout the country resumed in June. The country’s largest auto tire maker, General Tyre and Rubber Company posted that net sales increased by 42% in the first quarter of 2020 as compared to the 3.2 billion of last year for the same time. The growth in sales is also partially due to the government’s efforts to curb the illegal imports of tires.
The cement industry also posted significant growth in sales in the current year as monthly sales hit a record high in October 2020. The mills shipped 5.73 tonnes to consumers. The domestic consumption also increased by 15.8 percent to 4.85 million tonnes from 8.19 million tonnes in October 2019. In terms of Export figures, a rise of 11.58 percent from 784,433 tonnes in October 2019 to 875,266 tonnes in October 2020 was observed. Cement sales reached 19.3 million tonnes in the first quarter which is 19.3 percent more than the last year for the same time.
Talking about another major industry of Pakistan’s economy i.e telecommunications, the government has announced the launch of Spectrum Strategy 2020-2023 to assist commercial telecommunications operators in their network planning investments due to a significant rise in demand. Mobile data traffic in Pakistan rose from 165 percent to 69 petabytes in 2017 to 128 petabytes in 2018. Data use increased from 0.34 Gb/user/month in 2016 to 1.75 Gb/user/month in 2018.
Exports rose by 10.5 percent in October 2020 over the last month, with a rise of US$ 196 million to US$ 2.1 billion. On the other hand, imports decreased by 15 percent to US$3.7 billion in October 2020 by US$647 million compared to the previous month.
Real Estate Contribution To Pakistan’s Economy
Pakistan’s real estate sector is one of the major pillars of Pakistan’s economy. As per the World Bank’s Calculation, the size of the country’s real estate assets is between 60 and 70 percent of the country’s total wealth; if we extend this estimation to Pakistan, the average size of our real estate sector is between $300 and $400 billion.
Pakistan’s Real Estate did not perform well due to several financial, economic, and political challenges. But we can hope that things will get better if not immediately then gradually in 2021.
Real estate has slowed since 2017 due to political turmoil and volatility in economic and financial policies. With no incentives for investors and ban imposition on non-filers played a key role in deteriorating the real estate sector.
FBR’s strict regulations on non-filers’ banking transactions further discouraged the investors from investing their into the real estate market in 2018-19. The inability to utilize the development budget led to a contraction in the building sector is another factor to contributed to the real estate sector’s downfall.
One of the few reasons we believe to see the boom of Pakistan’s real estate market in coming years is CPEC. China Pakistan Economic Corridor is the iconic project between the two countries that has the potential to change the dynamics of Pakistan’s economy. The significant economic zones of CPEC are yet to be established, however, the benefits of CPEC can be seen with improved power situation and partial completion of the Lahore-Karachi motorway.
Pakistan’s real estate market is quite unpredictable. Therefore, you should be very vigilant and aware of the latest developments and updates related to Pakistan’s real estate market. Being aware of the current real estate conditions will help you make a rational and lucrative decision regarding real estate.
Property prices in Pakistan usually don’t go up even during inflation and uncertainty. This fact can make the investment much more challenging.
The real estate industry is fully capable of persevering through difficult times and that’s something special about this industry. Fair property values are the need of time to make the property affordable for every citizen which will be the ultimate success of the country’s real estate market.
What 2021 has for Real Estate?
The pandemic and uncertain political situation have affected the real estate market in 2020. We can hope things can get better and the real estate market will start to attract investors in the years to come
CPEC is an important venture. The economic corridor offers a source of overwhelming foreign investment. The web of roads under the megaproject is connecting Pakistan’s Gwadar port to China’s Xinjiang capital. This corridor will not only facilitate the economic activities of both countries but also open new doors of opportunities and growth to Pakistan’s real estate market. As the hub of CPEC activities, the demand for real estate is expected to rise in Gwadar and its outskirts.
2021 And Karachi’s Real Estate
Let’s discuss how Karachi’s real estate market is expected to perform in 2021 and what are our recommendations regarding investment in Karachi’s real estate market.
Karachi, the country’s largest city and the world’s seventh-largest metropolitan, is the major business hub of Pakistan. With ample opportunities for every sector, the Real estate sector still rules the city as the best investment domain.
Area Wise Recommendation For Investment in 2021
1) Gulshan E Maymar
Gulshan e Maymar is Karachi’s one of the most famous areas of Karachi. Maymar, located in the heart of Gadap Town, is a sophisticatedly designed area that has beautiful and well-trimmed parks, greenery, and serenity. Maymar is also known as Mini Islamabad, as the town was planned along similar lines as that of the federal capital. Gulshan-e-Maymar essentially consists of 10 sectors. According to recent research, Gulshan-e-Maymar is one of the most favorite destinations for renters. The peaceful and Calm environment of this vicinity is the key factor behind its rising demand. Let’s explore some of the other factors that attract people to opt out Maymar as their most preferred rental option in Karachi.
Gulshan-e-Maymar saw a significant improvement in terms of prices in 2019. Construction activities in Maymar are also in full swing due to the rising demand for housing on the outskirts of the city. Up to 70% of Maymar has already populated and still, the demand is high. Maymar has also attracted some of the city’s reputable builders such as Saima builder, Ayesha Builder, and Mehran Builder. Interestingly, all the new projects in Maymar are having a price tag of between 9 to 11 million. Therefore, Maymar has a lot to offer in the residential as well as in the commercial sector. We can say that Maymar will continue this potential in 2021 as well.
Latest Prices of Gulshan E Maymar
2) Scheme 33
Scheme 33 is our second recommendation for the year. Prices in Scheme 33 increased significantly in 2020, therefore, whether 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. my key society of scheme 33 is Saadi town, Saadi garden and peer Ahmed zaman for investment purpose. No matter which society you choose, never forget to visit our list of illegal societies to ensure your hard-earned investment will not go in vain.
3) DHA City
DHA city is our third recommendation 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.
The construction of the Malir expressway is another major development complimenting the DHA city. We can predict a lot of potential and significant jumps in prices for DHA city in 2021. We recommend you go for DCK if you’re interested in making a long term investment. DHA city has the potential of returning 100 percent of the investment within the span of three years.
Latest Prices of DHA City
4) Garden City
Garden City is our fourth recommendation for 2021. The project is situated near to Gulshan-e-Maymar and has all the utilities. Due to the significant rise in Maymar’s prices, Garden city experienced a boom in 2020. So, Garden city can offer a good alternative near Maymar.
5) Taiser Town
If you’re short of capital and really want to invest with a very minimal budget, our fifth recommendation for you is Taiser Town.
Property Ranking Analysis Of Pakistan
Pakistan has made significant improvements in the Property Rankings. The country is on the right path to establishing suitable conditions for corporations. As per the study of “Doing Business in 2020”, the World Bank has placed Pakistan at 108th position globally. Which is better than Pakistan’s previous 136th position. The jump of 28 spots indicates the enhancement in the economic environment which will ultimately draw direct foreign investment in the country and create job opportunities.
According to the World Bank, the flow of foreign investment and the widening of the market have a direct link to the valuation of real estate. The better economic factors suggest that the coming year will raise the market for luxury and commercial housing societies.
Our Advice for Pakistan Real Estate Investors in 2021
As a real estate investor, you should explore various asset categories of real estate before making your real estate investment such as residential land, apartments, homes, and commercial units such as offices, multifamily, industrial, and farmlands. You should ensure that you invest in such tangible assets instead of just a piece of contract or paper. We never recommend you invest in misleading products and documents claiming to be real estate but have no physical existence and actual value.
Pakistan’s real estate approach is very solid. The real estate market attracts not only local but also foreign investment. Other than that, several residential and industrial projects across the country are under development that provide lucrative investment opportunities. These properties are legal with investor-friendly repayment plans.
Meanwhile, if you want to read more such exciting lifestyle guides and informative property updates, stay tuned to Feeta Blog — Pakistan’s best real estate blog.
Pakistan Real Estate 2023 – Analysis, Forecast & Investment Options
- Published in Analysis, Bahria Town Karachi, Buying, DHA, DHA City, Gulshan-e-Maymar, Investment Tips, Market Overview, News & Updates, Scheme 33
Gulshan e Maymar – Key People Behind Maymar’s success
It takes decades to build and arrange any neighborhood. The same goes for Gulshan e Maymar of Karachi. In 1964, two engineering architects, Hafiz Sadiq Hussain and Syed Mazhar Ali from Karachi started working together and in 1966 they founded Maymar Consulting Engineers & Architects. Seven years later, they integrated the construction sector into their business and founded the Maymar Housing Services. Ltd. (MHSL) on July 7, 1973.
Between 1973 and 2000, MHSL built 300 bungalows, 1300 apartments in different parts of Karachi, completed 225 cheap apartments of Capital Development Authority Islamabad and 2 950 cheap apartments. He also completed the construction of houses in Mamyar Abad (Surjani Town).
In 1980, MHSL initially laid the Gulshan-e-Maymar foundation on 139 acres. Development work on the Gulshan-e-Maymar project was completed in 1985. Mr. Syed Mazhar Ali was elected senator of Karachi in 1985 and the plan was formally inaugurated in 1986 by the then President of Pakistan, General Muhammad Zia-ul-Haq.
Due to the popularity of this society in the city until 2000, its area was spread over an area of 1,000 acres.
In 1982, Mr. Hafiz Sadiq Hussain suddenly passed away. After his death, his family continued their business with Sir Syed Mazhar Ali. Mr. Syed Mazhar Ali also died in 2004 after a car accident near his home. On 31-08-2007, the two main families of Gulshan-e-Maymar sold all the assets of (MHSL) and completely separated from the project.
Mr. Hafiz Sadiq Hussain son of Muhammad Mazhar Hussain (1929 -1982) died at the age of 53, and Syed Mazhar Ali son of Syed Asghar Ali (1939 – 2004) died at the age of 65, were admirable personalities. Considering the affiliation of both dignitaries with Gulshan-e-Maymar, the bodies of these two gentlemen were buried in the park adjacent to “First Mosque of Gulshan-e-Maymar”, Central Jama Masjid of Sector X-6. From the beginning of the settlement to the end of their life, the two men, however, low the population rate, kept intact all the parks and all the basic amenities.
According to the social aspect, the most beautiful characteristic of the personalities of these gentlemen is, according to the decision of ten sectors and forty-six subsectors, that they did not divide the population into classes. But divided each area so that each section of the population could live their lives happily in a happy environment with full developmental harmony. In this regard, they provided mosques, central Eid Gah, wedding halls, pharmacies, petrol pumps, police stations, civil defense fire stations in various sectors for the availability of religious, cultural, legal orders and civic amenities to the residents. of Gulshan-e-Maymar, Family parks, playgrounds and rest houses were constantly included in the construction plan.
Gulshan-e-Maymar Housing Services Limited (MHSL) has had its central registers and commercial office in urban areas of Karachi since the beginning, but considering the concept of urban community system MHSL has renamed the regional office as “City Hall”. Considering the cultural, social and health aspects of the residents, separate clubs for men and women, indoor games, tennis courts, a swimming pool, a hall for events and a library were set up in the town hall. Later, the new president of MHSL, Mr. Abdul Rasheed (late) revived this closed library and paid tribute to the services of “Mr. Hafiz Sadiq Hussain” in relation to Gulshan-e-Maymar. The library was named “Sadiq Hussain Library”. Similarly, the road between Sector X-2 and X-3 behind the town hall is also named after “Mr. Hafiz Sadiq Hussain”.
The process of degradation in the quality of Gulshan-e-Maymar, begun after the death of Syed Mazhar Ali in 2004, continues with all its intensity.
During Abdul Rashid’s tenure, walls were built around the borders of Gulshan-e-Maymar, making it a walled project. Due to his personal will and efforts, an agreement was reached between Maymar and KESC (now k-electric) declaring Gulshan-e-Maymar as a load shedding free zone. In view of the deteriorating law enforcement situation of the city, he has taken special measure to ensure the safety and security of residents through coordination with Sindh Rangers and other private security companies.
It was the vision of Mr. Abdul Rashid that attracts many famous builders of the city to Gulshan-e-Maymar. Its policies have led Gulshan-e-Maymar to fame at the national and international level. Maymar’s business sector in particular has seen a massive boom due to its policies. He also emphasized the marketing of Gulshan-e-Maymar as a brand. Therefore, the Maymar logo has been changed to the current one.
Senator Syed Mazhar Ali (1939 – 2004)
He was an engineer, businessman, politician, educator and above all a philanthropist. His father, Major Syed Asghar Ali, served in the British Army Department. He obtained his degree in Civil Engineering from Karachi University (1958) in the first class.
He received a scholarship to Leigh University in the United States, from which he completed his MSc in Civil and Structural Engineering (1959-1961).
His construction plans included the construction of the Dhaka Intercontinental Hotel (East Pakistan).
He was also the president of the Association of Builders and Developers (ABAD). He was also the vice president of the National Housing Authority, Government of Pakistan.
He was also the Chairman of the Mobility and Tax Reform Commission of the Senate of Pakistan and introduced the IT system to improve tax collection.
He has also chaired Karachi’s Computer Training and Testing since 1997.
In 1998, he established the Karachi Institute of Information Technology (KIIT) in Gulshan-e-Maymar. He had a charming personality and will be remembered by all who had the honor of working with his warmth, honesty and sincerity.
After his death, when his financial affairs were closed, his family realized the extent of his silence by giving alms and helping the weak and needy.
He is survived by his wife, son and two daughters.
Abdul Rashid (1963 – 2020)
An experienced President with a proven track record of working in the construction industry. List of Negotiation, Business Planning, Internal Review, Analytical Skills and Asset Management. Strong professional development professional business with smart accounting focused on accounting, financing and management of The Smart Accounting Institute of Pakistan
May Allah grant Jannah to all these three personalities.
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Gulshan e Maymar – Key People Behind Maymar’s success
- Published in Gulshan-e-Maymar