OVERVIEW

Pakistan’s realty sector exhibited mixed trends during May 2016. Zameen.com’s meticulously analysed data revealed that Lahore and Karachi performed well during the month, while Islamabad failed to register impressive growth.

In Lahore’s property market, Bahria Town (proper) could not post more-than-modest numbers, while Bahria Orchard performed outstandingly. Defence Housing Authority (DHA) Lahore’s Phases VII to IX revealed lucrative trends and LDA Avenue I continued to register positive gains over the course of the month.

On the other hand, the realty estate sector of Islamabad could not perform well. Property values in the usually rampant DHA Islamabad remained stable. Bahria Town experienced a further decline in property values and Sector B-17 also remained unable to impress investors. Even Sectors F-11 and E-11 showed mediocre performance.

Nevertheless, the metropolis of Karachi showed a commendable performance as it registered significant growth in most localities with only the exception of Gulshan-e-Iqbal, which failed to impress investors during the month. Other localities such as DHA City Karachi (DCK), DHA Karachi, and Bahria Town Karachi (BTK) showed remarkable growth.

DHA’s projects clutched top spots in Zameen.com’s charts of top five localities for plots and homes across the country. However, DHA Karachi’s home category was an exception in this regard. Surprisingly, Eden’s housing projects also gained popularity and appeared on the list of top five localities for homes in Lahore, which is an unexpected development.

The holy month of Ramadan is already upon us and the real estate sector of Pakistan is likely to experience stability in terms of activity and property prices during the month.

Lahore

Investors apparently paid much attention to DHA Lahore’s Phases VII to IX in May, as the prices of 1-kanal plots in these phases increased 4.90%. The first six phases of DHA Lahore did not post equally impressive numbers, but their performance was not disappointing at all. Stability was the order of the day in Bahria Town (proper), however, Bahria Orchard impressed investors with a sharp ascent of 6.39% in the prices of 1-kanal plots.

Just like other localities situated on Raiwind Road, LDA Avenue I performed well during the month and the prices of 10-marla plots in the locality saw an increase of 7.57%. Wapda Town, on the other hand, clung on to mere stability. This trend is not surprising, as Wapda Town is fully developed and does not witness sizeable investment activity.

Islamabad

Islamabad’s realty sector dismayed investors in May. DHA Islamabad, which has been showing continuous growth for the last few months, ended on a stable note registering only 0.67% increase in prices of 1-kanal plots.

Bahria Town also performed sluggishly as prices dropped by 1.82% in the 1-kanal category. Investors are perhaps more interested in other Bahria Town projects across the country and are probably testing the waters in case of Bahria Town Islamabad/Rawalpindi.

Sectors E-11 and F-11 were no different and prices in the localities increased 0.16% and 0.96% respectively during the month. This can be attributed to the fact that these sectors majorly cater to genuine buyers and sellers as they only have a few plots left.

Karachi

Karachi’s lucrative realty sphere thrilled investors with a highly commendable performance and price increases. Property values in DHA Karachi have been increasing continuously for the last few months. In May 2016, the locality experienced a controlled rise of 1.07% in the value of 500-yard² plots. It still has potential for further growth in the future.

BTK also remained in the race with enthusiastic investment activity and 2.86% rise in the prices of 500-yard² plots in May.

Gulshan-e-Iqbal could not perform equally well. Being a fully developed society, it did not experience impressive investment activity and ended the month with a mere 0.24% rise in the value of 500-yard² plots.

Final Analysis

Possession is expected in DHA Lahore’s Phase VIII (proper) and selective blocks of Phase VII soon, which is why investors are particularly interested in these localities. Development work has begun in Prism 9 and it is anticipated that the project will not disappoint investors in the future. Accordingly, it is suggested that Phases VII to IX be considered for investment in Lahore.

The city’s Bahria Town (proper) has already seen multiple price ascents which is why investors are now paying attention to Bahria Orchard to bag lucrative returns. It is expected that LDA Avenue I will witness a significant increase as soon as real estate builders jump into the locality. On the other hand, Wapda Town has more or less reached its maximum potential which makes it undesirable for investment purposes but still feasible for living.

Investors putting their money into the federal capital’s property market must make informed and careful decisions as the city’s realty market seems to be slightly patchy in the present time. Decrease in prices in Bahria Town Islamabad/Rawalpindi can be attributed to the fact that investors are currently exploring other Bahria Town projects in the country. Sector B-17 is likely to experience better investment activity upon the resolution of land-related issues in Block D.

DHA Islamabad did experience a few price increases recently yet this trend slowed down to depict a pattern of stability in the locality. This shouldn’t fret investors, as the locality still has potential for growth. DHA Valley, on the other hand, will definitely experience price ascents once development work has been completed.

The property sector of Karachi has certainly been performing well for the past few months and trends suggest that DCK is currently the best locality for investment. BTK can also be considered although investors should bear in mind that the locality may experience price fluctuations in the future.

“Ups and downs are an important part of the real estate game, so investors should not worry too much about the recent price drops in Islamabad. I see a lot of investment potential in Lahore’s property market and believe that property prices in the localities situated along Lahore Ring Road’s southern loop will see some major ascents in the time to come. As for Karachi, I hope this port city continues to excite investors in the future just as it is doing right now,” said Zameen.com Chief Executive Officer Zeeshan Ali Khan.

“We anticipate sale-purchase activity to slow down during the holy month of Ramadan, but it will normalise soon after. After all, it is a time for peace, reflection, and correction even for the property market.” he added.