Why Real
Estate down in Pakistan?
Real Estate in Pakistan used to be regarded one of the safest and most
profitable investment opportunities. Investors would earn fast returns;
construction projects were booming. However, in recent years, the situation has
changed dramatically. The Real Estate market has slowed down, and the interest
of investor is decreasing day by day. Here are the key reasons behind this
decline.
Weak
Economic Condition of Pakistan
The foremost reason for the current downfall is
Pakistan’s fragile economic condition. High inflation, rising unemployment
have severely affected people’s purchasing power. The general public no longer
has the financial strength to consider real estate investment.
Taxes
The Government has imposed heavy taxes on the
"Purchase and Sale" of the property which is making it difficult
for investors.
High Interest Rates
The Banks have increased the interest rate due to
which the dealers cut off the Banks from borrowing, not only the buyers
affected also builders.
Uncertainty and Instability
In the past, people living in abroad played a major
role in fueling the real estate sector by investing their savings back home.
However, uncertain Pakistan’s economy, currency and policies Pakistanis are now
hesitant to invest.
Fraudulent
Projects
Another significant reason for the decline is the
rise in fake and fraudulent real estate projects. Many case where people were
scammed out of their savings through false promises and illegal housing
scheme. Such incidents have severely damaged the trust of buyers, making
them caution about investing in new developments.
Although the “Real Estate" sector in Pakistan
is currently facing one of the most challenging phase. However, there is a hope
for better days. If the government introduces meaningful economic reforms, the
bank will reduce the interest rate and provide legal protection to the buyers,
then this sector can be on the path of development.
