CategoriesInformative Real Estate Timelines

Real Estate Models: Pakistan vs. Dubai

As a real estate consultant, it is important to understand the differences between the real estate markets in different regions. In this blog, we will compare the real estate models of Pakistan and Dubai.

Real Estate Model in Pakistan:

The real estate market in Pakistan has been rapidly growing over the years, with the development of new housing societies and commercial projects. The real estate industry is largely unregulated, and the sector is largely driven by private developers. In Pakistan, the most common types of properties are residential properties, including apartments, villas, and houses.

The real estate prices in Pakistan are largely dependent on the location and the development of the area. The most expensive properties in Pakistan are usually found in urban centers, such as Karachi, Lahore, and Islamabad. The real estate market in Pakistan is largely driven by cash transactions, with many people relying on informal channels for buying and selling properties.

Real Estate Model in Dubai:

The real estate market in Dubai is vastly different from Pakistan, with the sector being heavily regulated by the government. The government has a major role in the development of the real estate market, with many of the major projects being developed by the government or government-backed companies. The real estate market in Dubai is dominated by high-end properties, including luxury apartments, villas, and commercial spaces.

The real estate prices in Dubai are largely dependent on the location and the amenities offered by the property. The most expensive properties in Dubai are usually located in prime areas, such as Dubai Marina and Downtown Dubai. The real estate market in Dubai is largely driven by digital transactions, with many people using online platforms for buying and selling properties.

Comparison between the Real Estate Models:

The real estate models in Pakistan and Dubai are vastly different, with each having its own advantages and disadvantages. In Pakistan, the real estate market is largely unregulated, which has led to rapid growth but also a lack of transparency. The real estate prices in Pakistan are relatively low compared to Dubai, which makes it a good option for investors looking for affordable properties.

On the other hand, the real estate market in Dubai is heavily regulated, which has led to a more stable market but also higher prices. The real estate prices in Dubai are relatively high compared to Pakistan, which makes it a good option for investors looking for luxury properties.

In conclusion, the real estate models in Pakistan and Dubai are vastly different, with each having its own advantages and disadvantages. As a real estate consultant, it is important to understand the differences between these models to help clients make informed decisions about their investments.

CategoriesInformative Investment Market Trends Real Estate

Pros & Cons of Open File Trading

Open file trading is a method of real estate trading in which the seller of a property hands over the original documents related to the property to the buyer before the full payment is made. In Pakistan, open file trading is a common practice, especially in the sale of plots in housing societies.

Here are some key statistics related to open file trading in Pakistan:

  • According to a report by Jang Group and Zameen.com, open file trading accounted for approximately 75% of all real estate transactions in Pakistan in 2020.
  • The same report found that open file trading was most common in the sale of plots in housing societies, with over 90% of all such transactions using this method.

Pros of open file trading:

  • Faster transactions: Open file trading allows for faster transactions as the buyer can begin the process of transferring the property ownership without having to wait for the full payment to be made.
  • Convenience: Since the buyer has access to the original documents related to the property, they can begin the process of transferring ownership without having to go through the hassle of requesting documents from the seller.
  • Flexibility: Open file trading allows for more flexibility in terms of payment schedules, as the buyer can make partial payments while the transfer of ownership is being processed.

Cons of open file trading:

  • Risk of fraud: There is a risk of fraud in open file trading, as the buyer may not make the full payment after receiving the original documents. This can leave the seller with no recourse to recover their losses.
  • Lack of legal protection: Open file trading is not legally recognized in Pakistan, which means that buyers and sellers do not have the same level of legal protection as they would in a traditional real estate transaction.
  • Lack of transparency: Open file trading can lack transparency, as buyers may not have access to all the information they need to make an informed decision about the property.

In conclusion, open file trading is a common practice in the Pakistani real estate market, especially in the sale of plots in housing societies. While it offers some benefits in terms of convenience and flexibility, it also carries some risks in terms of fraud and lack of legal protection. It is important for both buyers and sellers to carefully consider the pros and cons of open file trading before engaging in this type of real estate transaction. It is also advisable to seek legal guidance to ensure that the transaction is conducted in a safe and secure manner.

CategoriesInformative Market Trends Real Estate

Off Plan vs. Ready Properties in Pakistan

In Pakistan’s real estate market, there are two primary types of properties available: off-plan and ready properties.

Off-plan properties are those that are sold by developers before they are built or completed. Buyers typically pay a deposit upfront and then make additional payments over time as the development progresses. Once the development is completed, buyers receive ownership of the property.

Ready properties, on the other hand, are those that are already built and available for immediate purchase and occupancy.

In recent years, there has been a growing trend towards off-plan properties in Pakistan, particularly in major cities like Lahore, Karachi, and Islamabad. One reason for this trend is the high cost of ready properties, which can be prohibitively expensive for many buyers. Off-plan properties are often sold at a lower price point, making them more accessible to a wider range of buyers.

According to data from Zameen.com, one of Pakistan’s leading real estate websites, there has been a significant increase in demand for off-plan properties in recent years. In 2019, off-plan properties accounted for 53% of all property searches on the site, up from 44% in 2018. Meanwhile, searches for ready properties decreased from 56% in 2018 to 47% in 2019.

However, it is important to note that off-plan properties can also come with certain risks. Delays in construction or other issues with the development process can result in significant delays in delivery, which can be frustrating for buyers. Additionally, there is a risk that the developer may not complete the project as planned, which can result in buyers losing their investment.

Ultimately, the decision between off-plan and ready properties will depend on a buyer’s individual circumstances, preferences, and risk tolerance. Buyers should carefully weigh the pros and cons of each option and conduct thorough due diligence before making a decision.

CategoriesMarket Trends Real Estate

2023 Real Estate Market Forecast:

It is important to note that real estate markets are influenced by a variety of factors, including economic conditions, political stability, and social trends, among others. With that being said, here is an overview of the current real estate market trends in Pakistan:

Overall growth: Despite the challenges faced by the real estate market in recent years, the sector has shown overall growth in Pakistan. According to a report by JLL Pakistan, the real estate market in Pakistan is expected to grow at a compound annual growth rate of 4.2% from 2020 to 2024.

Increased demand for affordable housing: The demand for affordable housing is expected to increase in Pakistan in the coming years, as more people move from rural to urban areas in search of employment opportunities. This trend is likely to drive growth in the real estate market, particularly in the low- to mid-income segments.

Focus on sustainability: The demand for sustainable and eco-friendly properties is expected to increase in Pakistan, as more people become aware of the environmental impact of traditional construction methods. Developers who prioritize sustainability are likely to see increased demand for their properties in the coming years.

Shift towards digitalization: The COVID-19 pandemic has accelerated the trend towards digitalization in the real estate sector, with more people using online platforms to search for properties and conduct transactions. Real estate companies that invest in digital platforms and marketing strategies are likely to have a competitive advantage in the market.

Impact of government policies: Government policies, such as the construction package introduced in 2020, are likely to have a significant impact on the real estate market in Pakistan. The package aims to boost the construction sector by providing tax incentives and other benefits to developers, which could lead to increased activity in the market.

Overall, the real estate market in Pakistan is expected to show growth in the coming years, driven by factors such as increased demand for affordable housing and sustainable properties, as well as the shift towards digitalization. However, the market is also likely to be influenced by government policies and other external factors, which could impact its trajectory. As always, it is important for real estate professionals to stay up-to-date with the latest trends and market developments in order to make informed decisions.

CategoriesInvestment Market Trends Real Estate

Why buy a house in Islamabad?

Islamabad, the capital city of Pakistan, is known for its beautiful landscapes, modern infrastructure, and high standard of living. It’s a city that is rapidly growing and attracting people from all over Pakistan, as well as from abroad. If you’re considering buying a house in Islamabad, there are several compelling reasons why it’s a wise investment. Let’s explore some of the key reasons and back them up with relevant stats.

Growing Real Estate Market

The real estate market in Islamabad has been consistently growing in recent years, with property prices on the rise. According to Zameen.com, Pakistan’s largest property website, property prices in Islamabad increased by 10.24% in 2021. This indicates that investing in property in Islamabad is a wise decision, as it’s likely to yield a good return on investment in the long term.

High Standard of Living

Islamabad is known for its high standard of living, which makes it an attractive location for people to settle down and buy property. The city has well-developed infrastructure, excellent healthcare facilities, quality education institutions, and a low crime rate, making it a safe and comfortable place to live. According to Numbeo, a website that provides quality of life data, Islamabad ranks as the second-safest city in Pakistan and has a cost of living index lower than Karachi and Lahore.

Investment Opportunities

Apart from the residential sector, there are several investment opportunities in Islamabad that can help you generate a substantial return on investment. According to a report by JLL, a global real estate consultancy firm, the demand for commercial properties in Islamabad is on the rise, which indicates a growing business environment in the city. There are also opportunities to invest in the tourism and hospitality sectors, with the city’s growing popularity as a tourist destination.

Booming Construction Industry

The construction industry in Islamabad is booming, with several new housing societies and commercial projects being developed across the city. According to a report by the National Highway Authority of Pakistan, the construction industry in Islamabad is expected to grow by 8% in 2022. This indicates that there will be an increased demand for property in the city, which makes it a good time to invest in real estate.

Growing Population

The population of Islamabad is rapidly growing, which indicates a higher demand for residential properties. According to the Pakistan Bureau of Statistics, the population of Islamabad is projected to reach 2.5 million by 2025. This means that there will be a growing demand for housing, which makes it a good time to invest in property in the city.

In conclusion, buying a house in Islamabad is a wise investment due to the city’s growing real estate market, high standard of living, investment opportunities, booming construction industry, and growing population. The city offers several benefits to its residents, making it an attractive location to settle down and invest in property. By considering these factors and conducting proper research, you can make a smart investment decision that will yield long-term benefits.

CategoriesInformative Investment Real Estate

Working with a Real Estate Agent.

One of the biggest advantages of working with a real estate agent is that they can provide invaluable guidance and support throughout the home buying process. A good agent will help buyers navigate the market, identify properties that meet their needs, negotiate with sellers, and ensure that all necessary paperwork is completed and filed correctly.

In addition, agents often have access to resources and information that buyers may not be able to access on their own. For example, they may have access to off-market listings or be able to provide insights into local market trends and pricing.

While working with an agent can be expensive – typically 3-6% of the purchase price – many buyers feel that the benefits are worth the cost. In particular, first-time buyers or those who are unfamiliar with the local market may find that working with an agent is a valuable investment.

Negotiating a Rebate

An alternative to working with an agent is to negotiate a rebate from the seller. This typically involves making an offer on a property and requesting that the seller offer a rebate or discount in lieu of paying a commission to an agent.

While this can be a way to save money – rebates can be as high as 2-3% of the purchase price – there are several factors to consider before going this route. For one, not all sellers may be willing to offer a rebate, and even if they are, they may be less willing to negotiate on other terms of the sale.

In addition, negotiating a rebate can be complicated and may require buyers to navigate complex legal and financial issues. Buyers who choose to go this route should be prepared to do their own research, conduct their own negotiations, and take full responsibility for ensuring that all necessary paperwork is completed and filed correctly.

Ultimately, the decision between working with an agent and negotiating a rebate will depend on a variety of factors, including the buyer’s level of experience, comfort with the local market, and willingness to navigate complex legal and financial issues. Buyers should carefully consider their options and do their due diligence before making a decision.

CategoriesInformative Investment Real Estate

Why Discount is a Fraud?

A discount in real estate can seem like a great deal, but it can often turn out to be a fraud. Here are some reasons why:

 

Overpriced property: Some real estate developers will intentionally overprice their properties so that they can later offer a discount. The original price might be significantly higher than the market value, making the discounted price still higher than the actual value. This means that buyers end up paying more for a property than it is actually worth.

Hidden fees: Another way that a discount in real estate can be a fraud is by hiding additional fees. Some developers will advertise a discounted price but then add on fees for things like parking, maintenance, or amenities. This means that the final price ends up being higher than the advertised discount, and buyers end up paying more than they thought they would.

Poor quality: In some cases, a developer may offer a discount on a property that is of poor quality. They might use substandard materials, cut corners in construction, or neglect maintenance to save costs. This means that buyers end up with a property that is not worth the discounted price.

Incomplete development: Some developers will offer a discount on a property that is still under development, with the promise of completing the project soon. However, they may never actually finish the development, leaving buyers with an incomplete property.

Hidden terms and conditions: Finally, a developer may offer a discount with hidden terms and conditions. For example, the discount might only be available if the buyer pays the full amount upfront or agrees to a long-term payment plan with high interest rates. This means that the final price ends up being much higher than the advertised discount.

In conclusion, a discount in real estate can often be a fraud, with developers using a variety of tactics to deceive buyers. To avoid falling victim to these scams, buyers should do their due diligence and thoroughly research a property and the developer before making a purchase. They should also seek the advice of a trusted real estate agent or lawyer to help them navigate the buying process and avoid potential pitfalls.

CategoriesInformative Investment Real Estate

Pros & Cons of Investing in Gwadar Real Estate

Gwadar, a port city located in the southwestern province of Balochistan in Pakistan, has emerged as a hot destination for real estate investment. Here are some pros and cons of investing in real estate in Gwadar:

Pros:

  • Strategic Location: Gwadar is located on the Arabian Sea and is a gateway to the Middle East, Africa, and Central Asia. It is strategically located at the crossroads of international trade routes, making it an ideal location for investment.
  • High Return on Investment: Real estate in Gwadar has shown a high return on investment potential, with many investors reporting a significant increase in the value of their properties.
  • Government Support: The Pakistani government has taken a keen interest in the development of Gwadar and has initiated several development projects to boost the city’s infrastructure and economy. This support from the government is a positive sign for investors.
  • Potential Growth: Gwadar has a lot of potential for growth due to its strategic location and the government’s focus on its development. The city is expected to see a surge in economic activity and demand for real estate in the coming years.

Cons:

  • Lack of Infrastructure: While the government is investing in infrastructure development, the city still lacks basic amenities such as electricity, water supply, and sanitation facilities. This lack of infrastructure can pose challenges for investors.
  • Political Unrest: Balochistan has a history of political unrest and instability, which can impact the investment climate in the region.
  • Land Ownership Issues: Land ownership is a complex issue in Gwadar, and investors need to be aware of the laws and regulations governing land ownership to avoid any legal issues.
  • Limited Market: The real estate market in Gwadar is still in its early stages, and there are limited buyers and sellers in the market. This can make it challenging to sell properties and realize returns on investments.

In conclusion, investing in real estate in Gwadar can be a lucrative opportunity, but investors need to be aware of the potential risks and challenges involved. Conducting thorough research and due diligence is crucial to making an informed investment decision.

CategoriesInformative Investment Market Trends Real Estate

Why Real Estate Projects Failed in Gujar Khan?

 them, to avoid repeating the mistakes of the past.Gujar Khan is a small city located in Punjab, Pakistan. Over the past few years, there have been several real estate projects that have been launched in the city with the promise of providing modern and affordable housing to people. Unfortunately, many of these projects have failed to meet their objectives, leaving investors and homebuyers with significant losses. Here are some reasons why real estate projects in Gujar Khan have failed:

Lack of infrastructure: One of the primary reasons for the failure of real estate projects in Gujar Khan is the lack of infrastructure. The city has a poor road network, limited access to public transportation, and inadequate water and electricity supply. This makes it difficult for people to commute to and from the city and makes it challenging for real estate developers to provide modern amenities to residents.

Insufficient market research: Many real estate developers in Gujar Khan failed to conduct proper market research before launching their projects. As a result, they failed to understand the needs and preferences of the target market and could not offer properties that met the expectations of potential buyers.

Unreliable developers: Some real estate projects in Gujar Khan were launched by developers with a poor track record or reputation. This lack of credibility led to a lack of trust among potential buyers and investors, which made it difficult for developers to raise funds and complete their projects.

Regulatory issues: In some cases, regulatory issues and red tape made it difficult for real estate projects in Gujar Khan to obtain necessary approvals and permits. This further delayed the completion of projects and discouraged potential buyers and investors from investing in the projects.

Lack of marketing and branding: Finally, some real estate developers in Gujar Khan failed to adequately market and brand their projects. This led to a lack of awareness among potential buyers and investors, which made it difficult for them to generate interest and sales.

In conclusion, the real estate projects in Gujar Khan failed due to a combination of factors including lack of infrastructure, insufficient market research, unreliable developers, regulatory issues, and lack of marketing and branding. These factors should serve as a lesson to developers in the region to conduct thorough research and plan their projects carefully before launching

CategoriesInformative Real Estate

Similarities between American & Pakistan Real Estate model that led to Recession

The global financial crisis of 2008 was triggered by a collapse of the US real estate market, which had been experiencing a period of rapid growth and speculation. The market bubble eventually burst, causing a domino effect that resulted in a widespread economic crisis that had a lasting impact on the world economy. There are many similarities between the US real estate market in 2008 and the current state of the real estate market in Pakistan.

One of the key similarities between the two markets is the existence of a housing bubble. In both cases, the rapid growth of the real estate market has led to an artificial increase in property prices, which has made it difficult for many people to afford their own homes. In Pakistan, property prices have increased by an average of 35% in the past five years, making it one of the fastest-growing real estate markets in the world.

Another similarity between the two markets is the role of speculative investment. In both cases, investors have been buying property with the expectation that its value will continue to rise, rather than because of genuine demand for housing. In Pakistan, for example, many investors have been buying up plots of land with the expectation that they will be able to sell them at a profit in the future.

The role of easy credit is also a factor in both markets. In the US, subprime mortgages were a key factor in the growth of the real estate market, as they made it possible for people with low credit scores to buy homes. In Pakistan, banks have been providing easy credit to investors, making it easier for them to buy up large amounts of property.

One of the major differences between the two markets is the role of the government. In the US, the government had a hands-off approach to the real estate market, and did not intervene until the crisis had already begun. In Pakistan, however, the government has actively encouraged the growth of the real estate market, providing tax breaks and subsidies to developers and investors.

While there are certainly some differences between the US real estate crisis of 2008 and the current state of the real estate market in Pakistan, there are also many similarities. The growth of the market has been driven by speculation, easy credit, and an artificial increase in property prices, which are all factors that contributed to the US crisis. It is important that the government takes steps to ensure that the real estate market in Pakistan grows sustainably, to avoid a similar crisis. Investors should also exercise caution and avoid investing in real estate purely for speculative purposes.