Sallam all,
I would like to ask respected members about the prospects of buying plot in bahria phase 8 and selling it or building a house and selling it?
I was recommended abubakar block for 7 marla construction and selling it in six months or so.
Is it a viable option considering the headache and run around? Or simply buying plots in f and e blocks or safari valley and then selling it after a few months is better option?
Many thanks
Kashif
Well, their is not doubt that if you purchase a plot and start construction in Phase 8 soon after eid, you will be able to complete it in 7-8 months (Quality work time), or may be in 6 months, and it is the best time to start construction, no holidays, so you will be able to complete it in summers, and in summers, demand of houses in Bahria Town increases as their is no Load shedding, and you will earn good profit InshAllah, other than that, if you buy 3 plots in Safari Valley and keep them for 1 year you will be able to earn more profit that you will earn in building and selling a house (Stress/ work load / hassle) will be there, so i would recommend you to buy plots and keep them for at least sometime, plus i will never recommend you to buy files, buy developed plots. Regards,
Thank you Mr. Nasir and Rana for a considerable suggestion.
I urge some other seniors to also contribute.
Regards
The better option would be where you will make the most profit. Without knowing the cost price and selling price it is difficult to say which is a better option. You need to work on how much each option would cost and what you will be able to sell it for and only after doing that you can decide, With building you also have to spend a lot of your time and also there is a danger of cost overrun, so the return needs to be slightly higher in order to compensate.
AOA,
Here is my experience. Bought 3 plots 10 lac 12 and 13 in safari valley 30x55 each on 6th december 2012.. Construction completed on the first plot (while the plot price went up to 25 lacs) around june sold it in july for 80 lacs..... Construction cost was 30 to 35 lacs + 10 lacs for land extra 5 lacs my own expense. Now the second is only few weeks away from completion and should go for 85...... My choice is start construction and profit will be worth it....its very hard but the reward is very very good.In the current market plot price around 28 to 35 lacs construction cost 35 to 40 lacs and just compare the current market price there should be at least 20 lacs... In my case i was lucky to have bought very very cheap land.
I agree with H--T. Construction of house and then selling it is quite a profitable business. BUT you should have a complete team otherwise it will become headache for you to finish even first house. Very tedious job but if someone is hard working and can take the pain then its very good business in Pakistan.
Construction is no easy task, specially when you are building with the intention of selling. It requires good knowledge of product sourcing for finishing, knowing good workers including, plumbers, electricians and tile masons etc. Who can deliver on a finely finished house. If you want to sell a house for a Good profit, it has to standout in design and finishing to appeal to a buyer.
Also, you will need to remain networked with local property dealers. A vacant plot gains in value over time. But a finished house will gradually erode its profit with time as it might require some maintainence and repair, specially with painting, if it remains unsold over a period of time.
Last but not the least, it requires close monitoring. A friend of mine who was getting his house constructed in G-13 actually caught his workers selling bags of his cement cheaply to other people in the area! In short, its a specialized activity and requires experience. If you are up for it, you can try with one house and see how it works out.
In the example given by H-T, he purchased 3 plots for 35 lacs. He spent around 40 Lacs on construction. Currently he is showing a profit of 56 lacs on the sale of one house and capital gain on 2 plots on an investment of 75 lacs. If he had purchased 6 plots for 70 lacs, then he would be he would be showing a profit of 80 lacs. This means that he would have made more money just by putting all his money in purchase of plots, however prices increased very steeply in that period and he got his timing right otherwise building houses may have yielded a better return.
AOA.
@arshad your analysis is good in terms of accounting and i agree with you 100%. But i thought with construction i would be a part of a much bigger market than just selling plots and than sitting home for six months would be a night mare for me with invested all my money in these projects. I would still prefer construction i agree with irfan and syed brother you have to have an excellent team if not than an excellent knowledge and how to deal with workers. In my case i had to build my team up aswell which will pay up in my next few projects.
I do wish him all the best just remm any one paying whos paying 20 to 30 lacs extra for the property knows what you have been through so its not at all an easy task but you will love every day of it. Above all that you have to do allot of research aswell because property is a tricky business i was lucky to have bought the plots that cheap because after my buying they went straight up.now they are balancing and will rise further or very very unlikely decline.so do your research first before putting all your eggs in construction basket......
I'm grateful to all of you for this invaluable input.
I was a part of building our own house in bahria before. We had no prior knowledge of building a house then in "2010".
I was lucky to have someone who helped us along the way(a retired MES officer). I Learnt a few things along the way.
We gave a theka of "tesi kandi" to a thekadar alongwith electricity and plumbing. The most difficult thing is to tackle with labour and sourcing cost effective materials, dont you think?
The labour guys give a hard time if you give them advance money, and they generally go for long holidays plus as someone mentioned above, they sometimes steal and sale your stuff.
Thank you HT for wishing me goodluck.
Dear kashif depends on ur luck and contacts to buy a plot and construct is a good business but u can gain more profit in selling plots but again i ll say that it depends on ur contacts. If u buy a plot and start construction it will minimum take 8 to 9 months then it need one month to sale and transfer so roughly its a 10 month project in construction u will get less profit due to variation of material however if u buy 2 or 3 plots as if u r not building it then u can invest ur construction amount in plots so if u buy 2 or 3 plots on investor rate and sale them with in 4 months inshallah u will get better profit. Also it depends that in 10 months how much times u caN reinvest ur amount. However in commercial property construction is better option to gain profit as margins r very high there.