Pakistan’s real estate industry is booming once again thanks to the improved law and order situation in the country. Real estate market over the years has attracted investments from overseas Pakistanis with major investments coming in towards trustworthy housing schemes. However, now the trend of investment is shifting towards residential apartments in big cities.
Investments from overseas Pakistanis have increased by a huge proportion, considering the political changes being unfolded all over the world. The arrival of Donald Trump as US President and Brexit has also played a key role in changing people’s mind with regards to making investments in real estate in Pakistan. Job security concerns of Pakistani’s living in the Middle East, specifically Saudi Arabia, has also increased as thousands of people have lost their jobs in the last few years.
One of the reasons for this change of preference on the part of investors is a sharp increase in the land prices in the last few years. A 25% increase has been witnessed on year-over-year basis, making it a lucrative opportunity for the overseas residents.
Before 2014, only 5%-7% overseas Pakistanis opted to buy apartments in Karachi, but now these numbers have increased to more than 25% and in some cases go as high as 30%, according to Mohsin Sheikhani, Chairman Association of Builders and Development of Pakistan (ABAD).
Apartments are also an easy option for overseas Pakistani as they don’t have to go through the construction process when they return to the country, as oppose to something they have to do when they purchase land. Karachi is leading the race of attracting most investment in apartments sale with more than 300 projects in the pipeline while Lahore and Islamabad have about 150 under construction projects.
While apartments are becoming more and more popular, there are certain problems that are hindering the growth of high-rise buildings in Karachi. Shortage of water is the main issue and because of that Supreme Court of Pakistan has banned high-rise buildings making it difficult for builders to continue with the on-going constructions.