The real estate sector in Pakistan has a dynamic and significant role in the economy of the country. The real estate market is influenced by various factors. The real estate market is potentially influenced by interest rates for its performance and growth. The real estate market in Pakistan during 2024 navigated with challenges due to the economic landscape, fluctuating interest rates and pressures of inflation.
Real Estate Market in Pakistan October 2024
As we know political instability led Pakistan to economic instability and inflation. Due to economic instability Pakistani currency became devalued and the rate of the dollar rose. The inflation rate was about 32 % in 2023. Due to an increase in the inflation rate interest rate became high about 22 %. In all these situations, the banking sector was growing fast. Many investors were investing in the banking sector instead of the real estate sector. Because an investor was getting 20 lacs per annum profit on 1 crore without any hassle.
Now this new government has taken steps for the stability of the economy. It is the latest news that the IMF is providing a $7 billion bailout package for Pakistan. Although this grant comes with strict conditions. IMF predicts that the economy of Pakistan (GDP) will be 3.2% for the FY25 which was 2.4% last year.
The impact of high interest rates was felt across the entire property market, causing a drop in demand for residential properties, slower project developments, and reduced investment activity. The SBP made the strategic decision to lower interest rates by 200 basis points to 17.5 %, a third straight reduction since June.it is expected that the interest rate will be low to the one digit. It is hoping to revive the economy and stimulate growth in key sectors, including real estate. Due to the low interest rate now, investors will bring out investment in the economy and investment will circulate in different industries linked with real estate.
Interest Rate Reduction Benefits in the Real Estate Market
The reduction in interest rates is expected to have several immediate and long-term effects on the real estate market in Pakistan.
Increased Affordability for investors
The lower interest rates mean that mortgages become more affordable. Many middle-class families were priced out of the housing market due to high monthly payments on loans. Families can now consider purchasing homes with lower borrowing costs, which is expected to increase the demand for residential properties. Developers are hoping for a rise in inquiries and sales as potential buyers take advantage of more favorable lending terms.
Revival of Developer Activity
The interest rate cut is a welcome development for developers. The high cost of financing projects during the period of elevated interest rates caused many developers to delay new construction or scale back ongoing developments. Now, developers can feel more confident in taking on new projects with lower interest in the residential and commercial sectors. It will also have a positive effect on the broader economy by generating jobs and increasing demand for construction materials like cement and steel.
Increase in Investor Confidence
Real estate investors who are engaged in buying and selling of property, often rely on bank loans to finance their purchases. With lower interest rates real estate investments are more attractive again. Investors will re-enter the market, like urban centers and commercial zones.
Increased investor activity will also help improve liquidity in the market. The properties that had been sitting unsold during the period of high interest rates are more likely to be purchased. This could help stabilize and increase property prices.
Commercial Real Estate Market
The commercial real estate sector including office spaces, retail shops, and industrial plots, was also affected by high interest rates. Businesses that rely on bank loans to finance the purchase or expansion of commercial properties have been holding off due to the high interest rates. Due to the reduction in interest rates, more businesses may now be able to afford to expand their work leading to increased demand for commercial properties.
Considering these factors, it can be an investment that delivers unmatched dividends and is a golden opportunity. Pakistan Property Services has a huge inventory of this project.
The reduction in interest rates in October 2024 marks a positive turn for Pakistan’s real estate market. Lower interest rates can improve affordability for homebuyers, stimulate developer activity, and boost investors.
Take advantage of this golden chance and book affordable plots at reasonable prices and a flexible payment plan with Pakistan Property Services.
You can contact Pakistan Property Services to book a residential property. We provide better consultations for your real estate matters as the authorized dealers of Bahria Town and Etihad Town projects. For further information, you can call +92 321 111 2508 or visit our YouTube channel Pakistan Property Services, where we regularly update you to learn about the new trends in the real estate market of Pakistan.
Projects We Deal in:
- Bahria Town Lahore
- Bahria Orchard Lahore
- Bahria Nasheman Lahore
- Bahria EMC (Bahria Education and Medical City)
- Bahria Town Karachi
- DHA’s in all cities of Pakistan
Many residential and commercial societies in Pakistan are evaluated carefully to help our clients make the better decision. Pakistan Property Services helps the clients invest in projects with good prospects that depend upon the parent company, developers, location, payment plan, amenities they can have in the desired project.
Lahore:
Lahore is the cultural and economic hub as well as the provincial capital of Punjab. The city is well known for its huge economic opportunities in different sectors. People come from different areas to grab these opportunities and have a residence here. Below the list of some of the top Projects in Lahore:
- Bahria Town Lahore – Your Luxury Lifestyle Destination!
- Bahria Town Lahore Sector A
- Bahria Town Lahore Sector B
- Bahria Town Lahore Sector C
- Bahria Town Lahore Sector D
- Bahria Town Lahore Sector E
- Bahria Town Lahore Sector F
- Bahria Orchard Lahore – Your Luxury Lifestyle Destination!
- Bahria Orchard Phase 1
- Bahria Orchard Phase 2
- Bahria Orchard Phase 3
- Bahria Orchard Phase 4
- Bahria Nasheman Lahore – Your Luxury Lifestyle Destination!
- Bahria EMC Lahore (Bahria Education and Medical City)
Karachi:
Bahria Town Karachi is a benchmark within the landscape of Karachi with its world-class excellent-planned society. This society is sketched with an area concept to supply outstanding lifestyle facilities to its residents and can introduce new benchmarks of community development in Karachi. Below the list of some of the top Projects in Karachi:
Islamabad:
Islamabad is nestled against the backdrop of the Margalla Hills. It is a modern, planned city with wide tree lined streets, large houses, elegant public buildings and well-organized bazaars. It is however; always under construction to improve transportation or develop new housing areas for its growing population. The walkways are shaded, safe, and separated from the traffic by rows of flame trees, jacaranda and hibiscus. Roses, jasmine and bougainvillea fill the parks, and scenic viewpoints show the city to its advantage. Below the list of some of the top Projects in Islamabad:
- Gulberg Greens Islamabad
- Al Hafiz Grand Shopping Mall Gulberg Islamabad
- Naval Anchorage Islamabad
- Nexus Mall Islamabad
- Mall of Arabia Islamabad
- Discovery Gardens Islamabad – All You Need to Know
- Nexus Mall Islamabad – Bahria Town Islamabad
- Park View City Islamabad
- Verify Land Status from Property Verification Centre in Islamabad
Rawalpindi:
Rawalpindi is an important administrative, commercial, and industrial centre. Its industries include locomotive works, gasworks, an oil refinery, sawmills, an iron foundry, a brewery, and cotton, hosiery, and textile mills; it also produces shoes, leather goods, pottery, newsprint, and tents. Below the list of some of the top Projects in Rawalpindi:
- Blue World City Rawalpindi
- Citi Housing Rawalpindi
- Faisal Town Rawalpindi
Faisalabad:
Faisalabad, formerly known as Lyallpur named after the founder of the city is the third-most-populous city in Pakistan after Karachi and Lahore respectively, and the second-largest in the eastern province of Punjab. Below the list of some of the top Projects in Faisalabad:
- DHA Faisalabad
Gujranwala:
Gujranwala is a city and capital of Gujranwala Division located in Punjab, Pakistan. It is also known as “City of Wrestlers” and is quite famous for its food. The city is Pakistan’s 5th most-populous metropolitan area, as well as 5th most populous city proper. Below the list of some of the top Projects in Gujranwala:
- DHA Gujranwala
- ARY Laguna DHA Gujranwala
Multan:
Multan is city of Saints, it is best place to live if you belong to either middle class family, rich family or a poor family. The city is now develop city of Pakistan you can get every life facility here easily at low cast. Multan’s foods are very delicious especially mangoes of Multan are world famous. Below the list of some of the top Projects in Multan:
- DHA Multan
Bahawalpur:
Bahawalpur lies in the heart of South Punjab and is filled with stories that surround the legacies of Kings, Nawabs and their extravagant lifestyles. Below the list of some of the top Projects in Bahawalpur:
- DHA Bahawalpur
Peshawar:
Peshawar is the capital of the Khyber Pakhtunkhwa province of Pakistan. It is the biggest city of Khyber Pakhtunkhwa and is a relatively prosperous city. It is also a cultural and economic hub of Khyber Pakhtunkhwa. The city is famous for its food and tourism as it is one of the oldest cities of Pakistan with a recorded history that dates back to 539 BC. Below the list of some of the top Projects in Peshawar:
- Bahria Town Peshawar
- Citi Housing Peshawar
Gwadar:
Gwadar, town and seaport, southwestern Balochistan province, southwestern Pakistan. Located on the sandy Nuh headland that juts southward into the Arabian Sea, the town is an important fishing (sardines and sharks) and trade centre. Below the list of some of the top Projects in Gwadar:
- Naval Anchorage Gwadar
- Canadian City Gwadar
- Gwadar Golf City
Suggestions:
We can see that the Pakistan Real Estate Forecast suggests investing more in this market as it promises a huge profit in the coming future. The investors should purchase the properties at a low rate so that they can earn more by selling it once the rates are good enough.
Leave a Reply