Pakistan’s real estate market has been through some ups and downs over the years, but it has shown steady growth in recent times. The country has a population of around 220 million people, and with a growing middle class, there is a high demand for affordable housing. In this blog, we will discuss the current trends, stats, and figures of the real estate market in Pakistan.
Property Prices:
Property prices have increased significantly in the last decade, making it difficult for many people to buy a home. According to the State Bank of Pakistan, property prices have risen by over 120% in the last 10 years. However, with the government’s initiatives to promote affordable housing, the property market is expected to stabilize in the coming years.
Rental Yield:
The rental yield in Pakistan varies between 3% to 5%, depending on the location and type of property. Lahore and Islamabad are the cities with the highest rental yields in Pakistan. The rental yield in Lahore is around 4.5%, whereas in Islamabad, it is around 4%. This indicates that investing in rental properties in these cities can provide a good return on investment.
Real Estate Investment Trusts (REITs):
Real Estate Investment Trusts (REITs) were introduced in Pakistan in 2016, and since then, they have become popular among investors. The aim of REITs is to provide small investors with an opportunity to invest in real estate without actually owning the property. According to a report by JCR-VIS Credit Rating Company, the net assets of REITs in Pakistan increased by 30% in 2020, indicating their growing popularity.
Government Initiatives:
The Pakistani government has introduced several initiatives to promote affordable housing and boost the real estate market. The Naya Pakistan Housing Program is a flagship initiative launched by the government to provide affordable housing to low-income families. The government is also offering tax incentives to real estate developers to encourage them to invest in affordable housing projects.
Impact of COVID-19:
The COVID-19 pandemic had a significant impact on the real estate market in Pakistan, with property sales and rental yields declining. However, the market has shown signs of recovery, with an increase in property sales and rental yields in recent months. The pandemic has also led to a shift in preferences, with people preferring homes with outdoor spaces and home offices.
In conclusion, the real estate market in Pakistan has shown steady growth in recent times, with the government’s initiatives to promote affordable housing and the introduction of REITs. However, property prices remain high, making it difficult for many people to buy a home. Nonetheless, the market has a lot of potential, and with the right investments, it can provide good returns for investors.