No doubt investing in real estate is one of the most attractive high-risk and high return strategy in Pakistan.
It usually takes the least amount of work and is very feasible as a side project for those extra revenue streams.
However, the previous trends are not going to be repeated in 2019 and on wards because major developments in the state and citizen mindset are going to happen.
Influence of CPEC on the country
The China Pakistan’s Economic Corridor also known as CPEC has widespread influences all over the country. Basically the Chinese found an alternative route for their trade supplies. This route passes from Pakistan and is shorter and most cost-efficient.
Pakistan also finds it profitable for various sectors as the unemployment problems would be resolved for a massive population It is very beneficial for the real estate sector as well because people from all over the country, as well as the Chinese Immigrants, would be traveling to the CPEC route where the new road is going to lay down in Gwadar.
This will bring demand for housing accommodations in the otherwise less developed area which is expected to turn into a metropolitan city in near future. So real estate industry would thrive in the upcoming time which can be as close as 2020 due to the early completion of the CPEC route.
Pakistan’s Investment Mindset
Pakistan is observed to have a generalized mindset of investing in the real estate. People are willing to acquire the fanciest residential and commercial pieces of land into various locations technically putting so much money into the industry and wait for the continuous uprise of the prices.
People are not selling them at reasonable profit margins but instead, they are expecting the prices to go up and beyond over the passage of time. But it is seen time and again in various studies for business trends, that the prices cannot go continuously up.
They have to eventually peak up and face a downfall some time. If everyone is hoarding property and no one is selling them, a selling phase would occur where everyone would be worried to sell their property at the same time and the prices would go significantly down.
In addition to that, the real estate giants would predict that and they would start to sell properties in bulk decreasing the rate significantly. That is why it is recommended to sell them on reasonable profit margins.
The Invisible Plot Files
Real estate traders are very keen to invest in plot files without knowing their existence in the actual physical location of the residential project.
This leads to the problems where the housing societies issue many plot files to fulfill the demand but actually they do not have the land.
This is a serious threat to the industry because somewhere in the future, people will claim those files and not having the promised land would drop the values of the project.
Investing in Clever locations
The people who know real estate from too close would know which are going to be the projects everyone would invest in. The top-notch projects in high points of the country would be saturated and at some point, their prices would start to decline.
But the ones at developmental phases having the potential to grow into something big would be very feasible opportunities for investment in real estate. For example, the housing societies starting in the new airport area, the housing societies in Gwadar etc.
The real estate industry will be facing many positives and negatives as far as implications go. It will no doubt would be an attractive option for investment opportunities. However, the investors are supposed to be cautious to make a calculated decision before putting their money in any long-term projects.