Are you planning to invest in Lahore property market but aren’t sure which area will be the best to buy or rent a property in? Whether you are looking to purchase plots for investment purposes or buy a house to live in, you can’t make this decision on a whim, and should always do your due-diligence into which area is the best for you, lifestyle as well as investment wise.
Since market research is the most important part of investing in a property, Zameen is committed to guide you each step of the way and as the first step we’ve brought you this Lahore property market report for H1 2019, which takes an in-depth look at the buying and rental trends of properties in Lahore. The data in this report analyses how different areas of Lahore have performed in the first six months of 2019 (H1) compared to the last six months of 2018 (H2), whether prices have gone up or down and what the average prices are at the moment.
Here’s a comprehensive analysis of the H1 2019 market report of properties in Lahore.
Most Popular Areas with Plots for Sale in Lahore
Being one of the most meticulously planned neighbourhoods in the city, Defence Housing Authority (DHA) managed to maintain its position as the top searched area to buy plots in Lahore during the first half of 2019.
This didn’t come as a surprise as DHA Lahore is known for offering its residents a quality lifestyle. Thanks to its urban infrastructure, upscale shopping areas, recreational facilities, state-of-the-art hospitals and schools, innovative construction projects and top-notch amenities, DHA Lahore continues to be one of the hottest property markets in the country. These features guarantee a high standard of living in DHA Lahore.
Defence Lahore is considered one of the most secure housing projects across the board. Owing to the strict laws against expansion and encroachment, DHA Lahore offers its residents an aesthetically pleasing environment. This automatically makes it a popular choice among those looking to buy residential plots in Lahore.
While there hasn’t been a significant change in the plot prices of DHA Lahore, the buying trends of 5 marla and 10 marla residential plots saw a minor drop of 2.2% and 4.2% respectively compared to H2 2018 as smaller plots in lesser developed phases with relatively lower prices continued to gain popularity. Meanwhile, the prices of 1 kanal plots in the area increased marginally by 2% showing that this property type is always in demand. These minor changes indicate a largely stable property market.
On average, a 5 marla residential plot in DHA Lahore is priced at around PKR 55.7 lakh, while 10 marla plots can be bought for PKR 92 lakh. On the other hand, a 1 kanal plot in Defence costs about PKR 1.6 crore.
Those looking for investment opportunities in Lahore property market also showed interest in Bahria Town. This trend wasn’t unexpected either as DHA and Bahria Town Lahore have always stood out as two of the top searched for areas for investment according to the buying trends of properties in Lahore.
Launched in the mid-2000s, Bahria Town Lahore is known for offering affordable housing and investment options along with modern infrastructure and amenities ensuring a sophisticated lifestyle. Facilities such as electricity backup, schools of international standards, sports complexes, parks, various tourist attractions, sprawling commercial areas and a secure environment have made this project one of the most reliable and in-demand real estate developments in the city.
The renowned mega real-estate project, which came in second, also saw a small increase in residential plot prices, echoing the overall trend in the Pakistan property market.
Meanwhile, 1 kanal plots in the area are going for PKR 1.3 crore after seeing a price hike of 7.6% in H1 2019. The main reason behind this marginal increase can be attributed to the fact that the older blocks in Bahria Town Lahore are both expensive and have a limited supply of 1 kanal plots available for sale. This has subsequently caused the average price to go up slightly.
Other popular areas to buy plots in Lahore include Bahria Orchard, DHA 11 Rahbar, LDA Avenue, Lake City, Central Park Housing Scheme, Pak Arab Housing Society, Fazaia Housing Scheme and Khayaban-e-Amin.
Overall, the buying trend of residential plots in Lahore didn’t see any dramatic changes.
Most Popular Phases with Plots for Sale in DHA Lahore
DHA Phase 7 took the crown as the most popular locality to buy plots within Defence Lahore.
DHA Phase 7 has been gaining traction among investors looking to buy plots in Lahore due to its many attractive features. This includes underground electrical wiring, wide roads and boulevards, parks, sports complex and well-planned commercial areas. Since some parts of this phase are still being developed, the prices of plots are also not as high as some other areas. You can buy a 5 marla residential plot in this upscale neighbourhood for as low as PKR 64 lakh while a 10 marla plot costs around PKR 56 lakh. The buying price of 1 kanal plots in DHA Phase 7 starts at PKR 75 lakh.
On the other hand, DHA Phase 9 Prism, which is located near Allama Iqbal International Airport, scored the second position on the popularity index. Investors have shown interest in DHA Phase 9 Prism from the very beginning due to its prime location and the promised facilities. It also witnessed an increase in investments following the launch of Lahore Ring Road Southern Loop in H2 2018. In H1 2019, 5 marla plots in this phase continued to perform well. For a long term investment, DHA Phase 9 Prism is an ideal option as it is a developing phase with comparatively lower prices. The price of 5 marla plots in Phase 9 Prism starts at PKR 30 lakh whereas 10 marla residential plots cost about PKR 55 lakh at the very least. Moreover, you can buy 1 kanal plots in the locality for as low as PKR 65 lakh.
DHA Phase 6, DHA Phase 8 and DHA Phase 9 Town are also among the most searched for areas to buy property in Lahore.
Most Popular Areas with Houses for Sale in Lahore
Owing to its prime location and modern infrastructure, DHA has always held a significant position in Lahore real estate market. Once again, it topped the list as the most most popular area for buying houses in Lahore, according to the search results on our popularity index.
As discussed above, living in this area comes with its own perks, especially when it comes to a lavish lifestyle and latest facilities.
The average prices of houses in DHA Lahore didn’t experience any dramatic changes. The price of 5 marla houses in DHA Lahore dropped only by 3% to PKR 1.59 crore while the selling price of 10 marla units increased by 4% to 2.94 crore, owing to the always in-demand nature of this property type for houses in the city.
Meanwhile, the buying trend of 1 kanal houses in Defence Lahore remained almost the same at PR 4.97 crore. Given the current market trends of relative stability, it appears to be an ideal time for buyers to invest in Lahore real estate market.
The gated residential community of Bahria Town was the second most popular area to buy houses in Lahore owing to its wide range of affordable housing options paired with the availability of modern amenities.
While the cost of 5 marla houses in Bahria Town Lahore saw an uptick of 3%, the prices of 10 marla and 1 kanal options remained almost the same with negligible decreases. The average price of 5 marla houses in Bahria Town Lahore is around PKR 1.11 crore whereas buying a 10 marla house in the area will cost about PKR 1.89 crore. However, the average price of 1 kanal units in Bahria Town is somewhere around PKR 4 crore.
Other most searched areas for buying houses in Lahore include Johar Town, State Life Housing Society, Allama Iqbal Town, Wapda Town, Bahria Orchard, DHA 11 Rahbar, Paragon City and Pak Arab Housing Society.
The buying trends for houses in the Lahore property market may not have changed much during the first half of 2019, but a slight increase was observed in the prices of smaller houses. This stands particularly true for 5 and 10 marla units across the board, making them a good option for investment because of their high demand nature.
Most Popular Phases with Houses for Sale in DHA Lahore
DHA Phase 6, which is situated between Bedian Road and Barki Road, was the most searched area to buy houses in Defence Lahore.
When it comes to purchasing constructed houses, DHA Phase 6 is an ideal option. It is one of the top phases in Defence Lahore in regards to development and offers facilities such as water filtration plants, underground electrical wiring, wider roads, shopping areas, restaurants, educational institutes, medical centres and much more. If you are looking for a long-term, reliable return on your investment, properties in DHA Phase 6 have also seen a significant price appreciation.
The price of 5 marla houses in the area starts at PKR 1.3 crore while the cost of 10 marla units can go as low as PKR 2.2 crore. On the other hand, you can buy a 1 kanal unit in DHA Lahore Phase 6 at a starting price of PKR 3.2 crore.
DHA Phase 5 also received a lot of interest from buyers, becoming the second most sought after locality with houses for sale in Defence Lahore. It is perhaps the most developed and comparatively expensive phase owing to its high demand, superior infrastructure, maturity and luxurious housing options.
You can buy a 5 marla house in the area for as low as PKR 1.5 crore whereas the buying trend of 10 marla houses starts from PKR 2.2 crore. If you’re looking for a bigger place, 1 kanal houses in DHA Lahore Phase 5 cost around PKR 3.5 crore at the very least.
DHA Phase 4, DHA Phase 8 and DHA Phase 3 were also some of the top-searched areas to buy houses in Defence Lahore.
Most Popular Areas With Houses for Rent in Lahore
The upscale residential society of DHA has remained the first choice among those looking to rent houses in Lahore as well.
Rents of houses in DHA Lahore didn’t undergo any major changes except a marginal hike in the prices of 10 marla units, which is in line with the overall property trend in Pakistan. The average rent of 5 marla houses in Defence Lahore is around PKR 54,000 while you can rent a 10 marla property for about PKR 95,000 per month. As for 1 kanal houses in the area, the rental trend is averaged at about PKR 1.6 lakh.
Bahria Town followed DHA Lahore as the second most searched area with houses for rent in Lahore, seeking a small price hike across the board. The monthly rent of 5 marla houses costs about 42,000, whereas, for a 10 marla unit in the area, it amounts to around PKR 63,000. The average rent for 1 kanal houses in Bahria Town Lahore has gone up to PKR 1.1 lakh following a 7.1% increase from H2 2018, emphasizing on how popular and in-demand this property type is amongst renters.
Major Developments in Lahore
Earlier this year, the government of Punjab approved the construction of the 8-kilometre long Southern Loop III of the Lahore Ring Road. Once completed, this high-speed corridor will not only significantly reduce travel time in the city but also impact a number of residential and commercial projects. As seen with the openings of the first two interchanges on the Southern Loop, this major development would lead to a more rapid flow of buying.
The third and final loop can also positively impact mega projects such as Bahria Town and Defence Lahore along with Sui Gas Housing Society, State Life Housing Society, Eden Gardens, Khayaban-e-Amin, Lake City and Fazaia Housing Scheme, among a few others, in the future.
Overall, it appears to be a good time to invest in Lahore real estate market. Although there have been slight fluctuations in the average prices of some properties, owing to new developments in the area, the buying and rental trends have remained mostly stable.
DHA and Bahria Town were the top contenders for buying property in Lahore. You can also take a look at the differences and similarities between DHA and Bahria Town to determine which project relates more with your preferences.
Going forward, it will also be interesting to see how the budget for Fiscal Year 2019-20 impacts the real estate market. This stands specifically true for the Federal Board of Revenue’s valuation of properties being raised to 85% of market value.
The reduction in Withholding Tax levied on the purchase of property and the provision allowing non-income tax filers to purchase property worth more than 50 lakh can also affect the current market trend.
Zameen.com CEO Zeeshan Ali Khan said, “In Lahore, we expect to see a boom in the primary segment as the government is set to relax building by-laws that were previously very restrictive, resulting in much greater returns for developers. My advice to them would be to gain as much of a first-mover advantage as they can, by buying now.”
“Also, this change will – in the medium to long term – likely bring housing prices down as less land is utilized to create more units in a vertical development framework. I wouldn’t be surprised if Lahore starts to follow in Karachi’s footsteps in terms of going vertical in the years to come, especially since it has one of the most ideal urban infrastructures in the country to sustain this shift,” he elaborated. “It is the natural way forward, given that Lahore is quickly running out of space to continue building sprawling horizontal developments.”
Khan also added the city’s secondary market would also benefit from the completion of development projects such as the expansion of the airport, the completion of the Southern Loop III of the Lahore Ring Road and the Orange Line Metro.
Moreover, he said 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 utilization 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 utilize the property they are buying by making it livable now, or investing for long-term returns meant for future generations,” Khan explained. “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 continued.
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 Lahore Property Market Report for H1 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 Lahore. These prices are subject to change without notice.