The Future of Real Estate in Pakistan
Pakistan is the 5th largest country in the world with a population of 220 million out of which 60 million people make up our labor force. We have a growing middle class which means that people’s ability to afford things has been increasing consistently over the last few decades.
We have seen rapid growth in the real estate sector mostly due to the migration happening from rural to urban areas. Currently, a total of 36.8% of people reside in the city while 63.62% of people live in rural areas.
This migration has led to an increase in the demand for residential and commercial properties thus also pulling forward the construction industry with it.
Backbone Of the Economy
According to the Pakistan Economic Survey, the construction industry of the country accounts for 2.53% of the total GDP. If you weren’t sure of the impact of the industry before this then this figure should help clear any doubts you might have.
People have turned towards real estate as a reliable source of investment as well. The gold prices have been unstable for a while and the record-breaking inflation that the country is experiencing has made it difficult for a common man to rely on one source of income.
People want to save money but they want a secure form of saving that wouldn’t devalue their money’s worth with the changes in the economy. So far, the real estate industry has proven itself to be exactly what they are looking for.
Riding The Digitization Wave
Real estate used to be an industry that was a little isolated in terms of ease for the new players to enter. Most people didn’t have the right kind of knowledge to make the decisions regarding investments. Having the money to invest or purchase alone wasn’t enough since people needed a lot of guidance and reliable references to go ahead with the transaction.
All that has changed now thanks to technology. Now people have access to more information than before and companies like Graana and Zameen.com have revolutionized the industry by giving people more power to make quick decisions.
There is also more awareness regarding real estate in the market as more and more people are trying to find ways how to increase their wealth while the time is right. There are a dozen of options to choose from whether it’s related to housing projects or commercial projects so technically there is something for everyone.
Increased Support from Government
The role of government has been very active in ensuring a conducive environment for sector growth. Before covid and even during covid the government accepted real estate as an important pillar of the country’s economy and growth.
They have announced multiple policies and tax cuts to encourage further investment. The tax reforms have also provided many incentives to the builders and developers that have had a net positive impact on construction activity.
The biggest development from the government was to give the construction sector the status of an industry for the first time. They also announced an exemption on withholding tax on the purchase of materials while at the same time announcing multiple national and private banking schemes to assist house financing in Pakistan.
The result of these reforms was quick to reflect the pace of growth in the real estate industry. The Naya Pakistan housing scheme helped achieve a historic spike in purchasing and construction of residential property as it became easy for people to afford the activity.
Future Expectations and Trends
Based on the factors discussed above, the growth trajectory is going to stay upward for the coming years. The consistent growth in population and the increase in housing demand will keep the industry profitable and will give rise to many great projects that will help the people of the country enjoy great profits while at the same time a lifestyle that is similar to the international standard of living.
The competition in the industry is giving birth to innovation and higher quality outcomes which is a great thing for anyone associated with the sector. The CPEC project has also given the country a good image and hopefully more foreign investment will follow thus uplifting the sector and the economy of the country.