As inflation is soaring high with each passing day, the real estate investors are wondering what this pattern means for their assets and business. As a matter of fact, Pakistan real estate market has been largely presume as the best performing asset class due to its endless profits and quick gains. Experts believe that this hike in prices comes on the back of inflationary rise in construction input costs post pandemic.
The real estate analysts opine that Pakistan’s economy is seeing a radical upsurge in the prices of property owing to the growth of development in the country. A number of modern housing schemes are being introduced such as, Capital Smart City, Smart City Lahore which has shaped a sense of competition in the real estate market.
Not only private residential schemes but government projects including CPEC has also majorly influenced the value of the properties across the country. Once, these developmental projects are complete, the real estate market will surely be a rising tide lifting all boats.
Interestingly, Pakistan Real Estate Forecast 2022 appears to thrive more than many other investment opportunities in the market. The forecast has referred 2022 as a year of success for the real estate agencies in Pakistan and realtors’ market due to many reasons as unsteady gold prices, increased inflation and unstable stock market.
In the real estate economy, there are a lot more factors that affect the property prices. The economy has lost its balance since the government has now required everyone to be a filer and furnish the source of income while buying a property. Therefore, readjustment has distressed the economy at large.
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Moreover, constant devaluation of Pakistani currency against mighty dollar further added the insult to the injury. The uncertain economic decline has adversely affected the purchasing power of the masses which gives the perception of increase in property prices in Pakistan.
Another major reason for the increase in property prices in Pakistan could be the change in Interest rate which is inversely proportional to property prices. Consequently, the decrease in interest rate surges the property prices and vice versa.
This is because when interest rate increases, banks offer more profits on fixed deposits. So people are entice to sell their properties and deposit money in banks in order to earn high profits.
However, when the interest rate decreases, people find it lucrative to buy properties which in turns increases the demand and prices are inevitably hike.
To conclude, several cost-effective real estate projects that have successfully attracted investors, have surfaced, after the government actively took important steps to uplift the sector and combat the massive blow to the country’s economy faced due to the covid-19 pandemic. In this regard, the tax rates were lower after revision, and significant incentives were announce to bring investors in the loop.