Hard to believe but the first six months of 2019 have already passed, which means it’s time to make sense of the data available at Zameen and present a detailed overview of how Karachi’s property market fared during the first half (H1) of 2019, as compared to the second half (H2) of 2018.
We’ll be looking at the data for buying and renting houses, flats, and residential plots in Pakistan’s biggest metropolis. To get an unparalleled insight into what makes Karachi’s property market so popular, we have gathered data from our extensive price index to help you find the best avenues that deserve your investment during the second half of the year.
Most Popular Areas with Residential Plots for Sale in Karachi
Based on the total number of searches conducted on Zameen.com focused on Karachi’s property market, Bahria Town emerged as the most searched area for residential plots for sale in Karachi. Almost all its plot sizes surged in prices over the past six months, especially after the historic land acquisition verdict by the Supreme Court of Pakistan. Residential plots of 120 square yards in Bahria Town exchanged hands for an average price of PKR 46.78 lakh, while plots of 240 square yards saw a slight decline of 4.07% in price, with the average price being PKR 53.72 lakh.
Currently, larger plots of 500 and 1,000 square yards in Bahria Town have a price tag of around PKR 86.05 lakh and PKR 1.56 crore, recording positive upticks of 18.93% and 34.79% respectively, owing to the fact that most of the larger plots are located in Precinct 7 and Precinct 17 of Bahria Town and since both precincts are fully developed and have families settled in, they saw an increase in demand. Other localities where 500 and 1,000 square yards plots offer excellent investment potential are Bahria Golf City, Bahria Hills, and Bahria Sports City, all of which are being developed rapidly.
DHA’s housing communities have always been bankable choices for investing or buying property in Karachi, and our trends for buying plots in Karachi confirm the same. It doesn’t come as a surprise that DHA’s project, DHA City, also known as DHA Phase 9, is the second most searched area for residential plots for sale in the city. Backed by DHA’s stellar reputation, DHA City saw a rise in demand, which led to a hike in prices as well. The average price of a 500 square yards plot in DHA City hovered around PKR 85.37 lakh, witnessing a small dip of 5.74%, while plots of 1,000 square yards saw a price increase of 10.27%, touching a high of PKR 1.36 crore.
Other popular localities with residential plots for sale in Karachi include DHA, Scheme 33, Malir, Cantt, Gadap Town, Gulistan-e-Jauhar, Bin Qasim Town, and Naya Nazimabad. Prices saw a general uptick across the board, but there were a few surprising dips that are worth discussing further. One of these was the drop seen in average prices for 1,000 square yards plots in Scheme 33, which was due to the development of new housing schemes offering the same sized plots at comparatively lower prices.
Most Popular Areas with Residential Plots for Sale in Bahria Town
Bahria Town offers a range of amenities and entertainment options to Karachites, including a theme park, zoo, cricket stadium, and more. As the development progresses, so does the demand for its property.
Bahria Town, Precinct 12 is the most popular sub-area in the town, getting the highest number of searches on Zameen.com. As of now, residential plots of 120 square yards in this precinct are on sale for as low as PKR 30 lakh, while 240 square yards plots are available at a starting price of PKR 50 lakh. Bahria Town, Precinct 15 follows as the next best locality to invest in a residential plot in Bahria Town, with 120 square yards plots being sold for PKR 17.25 lakh.
Other popular districts to buy a residential plot in Bahria Town Karachi are Bahria Town, Precinct 27, Bahria Sports City, and Bahria Town, Precinct 8.
Most Popular Areas with Houses for Sale in Karachi
A more-than-significant portion of Karachi’s population comprises of lower and middle-income families, with only certain areas being favoured by the elite. This is why affordability is a key parameter, especially when someone is looking for a house in Karachi’s property market, and North Karachi caters to this need of property seekers quite well. The area features houses at affordable rates while being close to major commercial sectors and thoroughfares, enabling people to travel through the city for work or pleasure in a rather convenient manner.
For H1 2019, North Karachi led the pack when it came to houses for sale in Karachi with prices recording moderate increments across the board. North Karachi also encompasses a number of sub-sectors, affording people the opportunity to choose a house that best suits their budget and space requirements.
The average price of an 80 square yards house in North Karachi was PKR 71.95 lakh, witnessing a rise of 3.20%, while a house of 120 square yards could be bought for PKR 1.53 crore, an increase of 5.09%. Moreover, a house built over 240 square yards saw an uptick of 1.24%, averaging at PKR 2.68 crore, while a 500 square yards property saw no change with a price of PKR 6.5 crore.
The next most popular area to buy a house in Karachi was DHA, where a 120 square yards house costs around PKR 4.24 crore on average, reporting a minute decline of 0.20%. Moreover, houses built over 240 square yards had an average price of PKR 5.41 crore with a price hike of 30.68%. This hike can be attributed to the fact that quite a few new phases in DHA recently got completed or are nearing completion, which attracted the attention of buyers and investors. Furthermore, larger houses of 500 square yards saw a rise of 1.88%, with prices of PKR 10.46 crore.
Other searched areas for houses for sale in Karachi were Gadap Town, Scheme 33, Gulistan-e-Jauhar, Federal B Area, Malir, Gulshan-e-Iqbal Town, North Nazimabad, and Cantt. As per our data trends, many of these are also among the top localities for buying a house in Karachi.
Most Popular Areas with Houses for Sale in North Karachi
Buffer Zone emerged as the most popular sub-area with houses for sale in North Karachi. A 120 square yards property in Buffer Zone is available for sale at PKR 1.1 crore, while a house of the same size in North Karachi, Sector 11B can go for PKR 1.3 crore. Moreover, a 240 square yards home in North Karachi, Sector 11B had the average price of PKR 2.1 crore.
Other popular sectors for real estate transactions in North Karachi include Sector 11-C/3, Sector 10, Sector 11A.
Most Popular Areas with Flats for Sale in Karachi
Karachi, while expanding horizontally, is still more of a vertical city. As such, the area that received the most number of searches for flats for sale in Karachi’s property market during H1 2019 was Defence View Society. However, apartment buildings here mostly feature 2-bed units, the price of which increased by 3.61% over the past six months. The average price of a 2-bedroom apartment for sale in Defence View Society is PKR 71.17 lakh, while the average price of a 3-bedroom flat is around PKR 1.10 crore.
Gulistan-e-Jauhar followed as the second-best locality to buy a flat in Karachi, which should come as no surprise to the residents of the city with so many new housing projects being underway in the area. It is also one of the most popular localities for buying a flat in Karachi, as seen in our monthly buying trends. The price of a 2-bedroom flat here is around PKR 62.63 lakh, which shows an increase of 18.13%, while 3-bedroom options have average prices of PKR 96.68 lakh, an increase of 7.64%.
The remaining most popular areas with flats for sale in Karachi are Scheme 33, Gadap Town, North Nazimabad, Malir, Shahrah-e-Faisal, Nazimabad, Gulshan-e-Iqbal Town, and Federal B Area.
Most Popular Areas with Flats for Sale in Defence View Society
Defence View Society is ideally located between Baloch Colony and Korangi, with easy access to Shahrah-e-Faisal and Shaheed-e-Millat Road. Iqra University’s main campus and Imtiaz Super Market’s Korangi branch are the most popular landmarks here.
Most Popular Areas with Houses for Rent in Karachi
After an analysis of the data collected by Zameen.com, DHA was discovered as the top area with houses for rent in Karachi, followed by Cantt. With regards to houses for rent in DHA, the average rent of a 120 square yards house is around PKR 1.2 lakh, a negligible increase of 0.05% over the past six months, while a 240 square yards home saw no change in its monthly rent of PKR 1.5 lakh. Larger properties of 500 square yards, however, have an average monthly rent of PKR 2.74 lakh, meaning a hike of 3.26%.
A 120 square yards house in Cantt, on the other hand, has an average monthly rent of PKR 43,000, with a noticeable increment of 13.46%. Meanwhile, the monthly rent goes up to PKR 61,000 for a house of 240 square yards. Moreover, a 500 square yards house can be rented for PKR 1.13 lakh, which is an increase of 6.22%.
Other popular areas with houses for rent in Karachi are North Karachi, Malir, Gulshan-e-Iqbal Town, Gulistan-e-Jauhar, Clifton, Federal B Area, Gadap Town, and Scheme 33.
Most Popular Areas with Flats for Rent in Karachi
Moving on to flats for rent in Karachi, DHA once again led with Gulshan-e-Iqbal Town closely following at the second spot. A 2-bedroom apartment in DHA Karachi has an average monthly rent of PKR 39,000, which is an increment of 2.40%. Meanwhile, a 3-bedroom alternative in DHA can be rented for PKR 76,000 with a positive change of 6.33%.
On the other hand, the average monthly rent for a 2-bed flat in Gulshan-e-Iqbal Town is PKR 28,000, with the subtle hike of 0.55%. Renting an apartment with 3 bedrooms in the area, however, costs PKR 45,000 on average, which means an increase of 6.80% in the monthly rent.
Other popular localities with flats for rent in Karachi are Bahria Town Karachi, Gulistan-e-Jauhar, Clifton, Defence View Society, North Nazimabad, Cantt, Sea View Apartments, and Federal B Area.
This wraps up our analysis of Karachi’s property market trends for H1 2019. As indicated by the data and numbers, property prices in Karachi have seen a rise in prices overall. However, the recent Fiscal Budget 2019-20 announced in June has introduced several taxation policies for real estate, the effect of which will become evident during the coming months. Property prices in Karachi will also see a change once the proposed Green Line BRT is initiated, as commuting to work, primarily to I. I. Chundrigar Road, will become easier for those living in distant parts of the city.
With regards to the Green Line BRT, the first phase of the construction of the corridor has been completed, connecting the city from Surjani Town up to Gurumandir. However, with Red Line and Yellow Line BRTs also being proposed in the recent budget by the provincial government, a Common Corridor is being set up at Numaish so that all the BRTs intersecting at M. A. Jinnah Road will have a shared transfer point.
Road works at Shaheed-e-Millat Road are also underway, with two underpasses being built at the intersections of Hill Park and Tariq Road, which will reduce travel time and make the commute from one part of the city to another more efficient. The revival of the Circular Railway is also one of the projects that have been proposed to ensure easier commute for the residents of Karachi.
All of these projects will have a positive impact on Karachi’s property market, with the market heading in the right direction for the remainder of the year.
This opinion is also shared by Zameen.com CEO, Zeeshan Ali Khan, who quoted, “Karachi underwent a rough few years with court-ordered development bans and stalled activity in Bahria Town because of legal issues, but since both of these problems have now been resolved, the city’s market is surging forward. We can expect more projects in the primary market, and development projects such as the revival of the Circular Railway, among others, will most definitely have a positive impact on the secondary segment.”
Commenting on the overall condition of the real estate market of Pakistan, Khan stated that over the last few years, especially since the introduction of revised taxation regimes, Pakistan’s real estate sector had become a market largely dominated by genuine buyers and investors whose primary interest was not to make a quick buck, but long-term utilisation of property.
“What we’ve seen since the end of speculative trading is the emergence of a class of buyers and investors whose aim is to either utilise the property they are buying by making it livable now, or investing for long-term returns meant for future generations,” said Khan. “There is next to no trading or flipping going on because that is no longer as lucrative a prospect as it once was, given the drastic changes to the taxation mechanism over the last few years.”
“With the announcement of the latest budget and yet another revision in the tax regime, we expect to see stable price trends in the coming months before the market reacts to these changes. This makes for an ideal buyers’ market, and that too in a sector where stability is virtually guaranteed because of the cash-based nature of the investment and the near-absence of mortgages. Risks are low, rewards are potentially very high in the long term; that is an ideal investment scenario,” he added.
Khan also said the major realty markets in the country such as Karachi, Lahore and Islamabad had distinct challenges and their own sets of opportunities for investors to make the most of.
Disclaimer: The H1 Karachi Property Market Report for 2019 is based on prices advertised by real estate agencies on behalf of their clients on Zameen.com, and do not represent actual real estate transactions conducted in Karachi. All prices quoted above are subject to change without notice.