Stock market crash that started in china has engulfed entire world. Whether this is temporary or lasting meltdown, only time will tell, but emaar is the biggest hit in dubai with stock prices 8% down. Karachi stock exchange was also badly hit and lost over 1400 points in a single day.
This tsunami is surely going to hit real estate market. So folks, dig deep and get ready for another tidal wave hitting the shores soon.
Bad ... Do u think prices of properties will decrease ? N how much ?
If yes, then What should property owners do ?
Bad stock markets means real estate prices will rise, isn’t it?
Some people are advising to buy USD … How sensible is that ??
Sir as far as i know stock crashes do not have a direct or indirect impact on real estate. If you take out history from 1900 onward you would see that stock crashes had no correlation with real estate except for 2008 but again that was mainly driven by the sub-prime mortgages. Real estate is more dependent upon demand and supply factor and more precisely the spending patterns. China for instance has currently the largest real estate bubble of now with too much of supply and their price to income ratio is the highest even higher than NY. That bubble at one time is going to burst regardless of whether their stock market crashes or not.
Another example is Japan which is soon to see its real estate meltdown. Why? Zero growth, more dyers than young buyers, too much of QE to support the money supply (in terms of their economy their QE to date has been 2.5x that of the US), reduced birth rates for the last 4-5 decades and it has the least immigration as Japanese are more concerned about preserving their identity and culture. So ultimately it will lead to a huge supply with no real demand and kaboom.
However, Japanese stocks have no correlation to this.
These new housing societies go and down like stock market … My parents got a plot in wapda city for 3.7 million … After 18 months it stands at 9 million … But these NEW wanna be societies in Islamabad do no hold their ground… Don’t know why
Let’s wait and see. I bet Munshi Ishaq Dollar is all sleepless tonight.
Experts around the world are terming it as correction rather then a meltdown. This makes sense as all world economies are in green with the exception of China, we don't really know whats happening in china as the economy news is tightly controlled by state.
Putting it practically, Lets say a small investor with a few crores invested in KSE and suffered big losses during the last few days; Now this investor would need to make up for the losses so he can potentially sell property. The good thing is that the investment funds don't invest that much in property, therefore there is no risk of mass selloff. Personally speaking, i don't think there would be any impact of Stock market activity on property market. PK property market is linked with the overall economy of the country, which is in green as of now.
This can of course change if china crashes(Economy! not stock market), this seems very unlikely as of now.
People suggesting to buy USD: I second that, there is another thing happening in world markets- currency devaluation, again started by China, PKR is bound to be devalued as well(intentionally by PK government to keep exports stable). USD would hold strong.
Omar Farooq: analysts do not see dollar remain strong, in fact some predict bubble burst sooner than later:
V: Congrats bro, 240% gain in just 18 months and that too in these slow times is mind boggling. How could I miss this society!
Stock market crash cuts both ways. The 2008 crash in Dubai for instance, busted the real estate bubble. On the other hand, in countries like Pakistan, money keeps swinging between Stocks and Properties depending where performance is better.
I think Mr V wanted to write 18 years, not months
In 18 months?
WOW @V
Big guns of stock markets are going to shift their money into property now. Anyway, this is not as big a crash as 2008 was.
@isloo, There are all kind of articles jumping around the web. It doesn't necessarily mean that it will happen. Thinking about it logically, USD is world currency with almost every company in the world using it to make transactions. It seems highly unlikely that it will crash as there is no basis or factors that indicate as such.This is my opinion.
As if i suggested, the risk of any negativity globally and in Pakistan is dependent now on China, if Chinese economy contracts(highly unlikely), only then will we see the ripple effect across world. Stock Market decline is not a good indicator of economy progress.
Pakistan stock market is getting down just because of international investors otherwise there is no reason for Pakistani stocks to go down, all economic indicators are favorable and positive.
Stock exchange crash will not effect the property in Pakistan, because the property prices in Pakistan already on decline phase.
In my opinion if this crash continue for long time then investors may come back in property and it might help.
Small investors are selling in panic... As they usually do in all business. Stocks, property or dollars... Big players buy and sell at right time and always get benefit...
don't buy dollars just as people are saying... Pakistanis always do this and create a bubble in market which always burst at the end... And destroy many
No sir 18 months .. Or precisely 20 months if I recall .. Got it in 2013 for 3.8 million rupees including transfer and commission to dealer .. Got a call from a some dealer for the offer of 9 million two days back ... Wapda City , Faisalabad
Plot is 1 kanal
And it is expected to touch 1.5 crore by the end of next year because
10 lane express way is being built in front of the society ..
Around 400-500 houses are already there and people are living and around 70-80 structures are under construction .. It is the fastest growing society at present in Faisalabad.
Sorry it is the wrong thread but as some members @isloo and others showed interest so thats why I explained
Omar Farooq: For the time being rupee is loosing against dollar, touched 104 in interbank and crossed 105 in open market in just two days of turbulence. But what I mentioned earlier was dollar's speculative position in international market.
Ahmed Tanoli: That's right bro, the shift
(N.B. Sorry V, I meant 143% gain and not 240%, my poor math!)
Dollar is not bloated and is not going to burst. Dollar has no absolute value any currency does not it is valued relative to other currency. Dollar bubble bursting would mean it is going in hyper-inflation but it is not. One reason to debase the dollar would be QE but not just USA many countries around the world have been doing it and much aggressively than USA.
if there won't be anymore QE dollar would gain massive strength among others