Property market in Pakistan: What the future holds?
Like most other countries in the world, Pakistan is currently going through a property and real estate boom. The prices are sky high and are going even higher. Prime locations in chief cities like Lahore, Karachi and Islamabad are being chased by property hunters and the prices are already touching millions of US dollars. A one kanal house in areas like Gulberg, Model Town, and Defense are being sold for $200,000, $300000 to $500000 for two kanals and so on and so forth. The prices have risen almost five times of what they were a couple of years back. People have stopped selling in this market and hence it has become a sellers market. The wait for further increase in the price is holding buyers at bay and sellers in the wait. But is it worth it? Are property prices all set to rise further or is the bubble burst just around the corner?
The Buying spree
A lot of people are looking at this as the right time to invest into the market. They are investing and buying housing projects that will still take years to develop. Take the example of the various housing societies that are coming up a few kilometers from the outskirts of these major cities. Most of these societies have homes that are priced in lakhs. But people are not looking to sell at all. When they start selling, the prices will go down and it will instantly bring about a market correction that should change the current scenario. In addition to this a lot of people are taking home loans to buy homes and looking to tap into the lucrative market. But as a result of the steady rise in the interest rates, a lot of people have been defaulting on these loans. This is not helping the market one bit. Is it?
The downturn point
Buyers need to be aware of the downturn point or the ceiling of the current rise. There are very little original buyers who are looking to invest in property with a long term goal in mind. The rest are small term investors who are simply looking to buy small pieces of land and later sell it off for higher rates. Society owners are also buying files in bulk so that later on they can create an artificial deficit for files and sell these files for exorbitant prices. Most experts will suggest to you that the bubble will burst very soon. A lot of people are now getting to dealers so that they can sell off their plots. A lot of rumors are also doing the rounds that big time players have resorted to massive selling in the fear that the real estate bubble will burst very soon.
The future
These rumors, the current rising trend and the market scenarios suggest that a long overdue correction will set in the market very soon indeed. The current overpriced market will see a decline in prices and this will bring much wanted relief to many people looking to venture into this market with a long term perspective.
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