In the wake of the COVID-19 pandemic and last year’s locust attack in Pakistan, the economic growth came to a staggering halt in the country. This is because these emergencies required many Pakistanis to sell their assets and keep cash on hand. Almost all economic markets in the country were adversely affected by these surreal events. However, one market still managed to remain undefeated and came out victorious even through these tough times.
Pakistani real estate market has been the country’s highest grossing economic sector for so long. This is because there are several thousands of real estate projects popping up in the country every other day! The economic growth due to this sector alone has been a major contributor to the overall economy of the country.
Here’s what you need to know about why the Pakistani real estate sector is a favorable market to invest in 2021!
Pakistan Real Estate Forecast 2021
Many people stopped investing in the real estate sector during the start of the pandemic. This caused the property prices all over the country to drop. People sold their properties to keep cash at hand in case of emergencies.
However, due to the drop in prices, people quickly resumed real estate investments. It became the perfect time for people to stack on properties because the prices were low and so was the risk. Normally, property investments need a huge sum of capital to be profitable for beginners. However, that was not the case in the Pakistani real estate market during the pandemic. People with fewer capital savings were also able to invest in the property sector, thus, raising property demands all over again.
Real Estate Forecast or Market Condition in Pakistan in 2021
The Pakistan Real Estate Forecast 2021 seems to be going well as many other investment opportunities are being neglected due to their volatile nature. The Pakistan Real Estate Forecast 2021 tells that it is going to be a year of boom for the real estate market due to many reasons. Some of the reasons that make real estate a desirable place to invest are discussed below:
Unstable Prices of Gold:
Many people like to invest in Gold as it serves many purposes. But recently, Gold is facing a very unstable market. Its prices can rise up to $2000 per ounce to start drifting downwards very soon. This trend has chased away many investors as they think it is not the time for a secure and safe investment in gold. Their investment in turn is going into the real estate growth in Pakistan.
If you don’t know much about the stock market, it will eat you up.
The stock market is very volatile and needs decisions in a few seconds whether to sell or buy more shares. This is not a secure and safe investment for many investors who are not willing to take excessive risks. Due to this reason, many people have sold their shares to invest in the real estate market of Pakistan.
Huge Reduction in Property Tax for 2021
The government of Pakistan has lowered the interest rate and announced incentives for the investors and businessmen to mitigate the economic impact of the pandemic. The PTI government has proposed several relief packages for the construction industry with the twofold aim of providing employment to daily wage earners, and spurring economic activity.
The package also includes additional incentives for builders and developers to build low-cost housing for the poor under the Naya Pakistan Housing Program. The tax rate will be fixed for the construction and the withholding tax will be waived off.
Real Estate Market for the Economy of Pakistan:
The real estate market of Pakistan supports the economy of Pakistan to a large extent. Not only Pakistani investors but also foreign Pakistani investors see the potential in this market. The new PTI government has also made it possible for foreign Pakistanis to invest in real estate in Pakistan much more easily than in the past.
One of the many main reasons for the investment of foreign investors in Pakistani real estate is the stability in the social conditions of Pakistan and the safe environment. This was not the case a decade ago as the environment became very dangerous and people feared the unstable and volatile nature of political and economic environments.
Influence of CPEC on Pakistan’s Real Estate Market and Pakistan’s Economy:
From the start of CPEC, the economic conditions of Pakistan have started to become better. CPEC has turned out to be a pioneer of transformational change in Pakistan’s economy. It has transformed the real estate industry too since it has connected Gwadar seaport to Kashgar located in China. This one link will serve as a trade route for both bordering countries.
Owing to the enormous success of CPEC, Pakistan’s real estate market has definitely grasped the attention of investors, keen to look for an investment opportunity from all over the world. Due to this trend, there has been a notable rise in real estate projects and the prices are also increasing.
When the trade route is going to be completely established between Pakistan and China, then the requirement for proper road infrastructure also will arise. Road infrastructure increases the value of places that are around it. This will in turn influence the real estate market because the prices of homes, plots, and even rental apartments will increase.
Most societies are located on the outskirts of the major cities like Bahria Town in Lahore, Bahria Town Karachi, Multan, Islamabad, DHA etc. which can easily be connected to the CPEC. The CPEC has a great hand in raising the prices of properties in these. The plot of 1 Kanal of PKR 1,000,000 can be easily converted into PKR 5,000,000 after being part of these societies.
It is contemplated that within the next twenty years, the population of Gwadar will rise to more than three million. So, in this respect, CPEC will become a necessity to cater to all the wants of the increased population. Gwadar City will be established in a gated community that will provide residential, commercial, entertainment, cultural, and educational environments under one roof. It should be noted that more than 50% of the area is set aside for open spaces.
Owing to the increase in the development in Gwadar, many schools, shopping malls, and hospitals are assumed to be built in the city. More than 1500 homes are going to be built across a locality of 3.5 million sq. ft. Moreover, with many immigrants arriving at Gwadar port, the worth of land will rise. This will, in turn, promote the real estate market.