Real Estate Investment Portfolio (3-5years)

[bilshd (MBS)]

Real Estate Investment Portfolio

I understand many of this forum members are expats like me and the general intent seems to be returning to Pakistan in 3 -5 years and have the perfect place to build our home, when we go back.

I guess on average a person spends around 3Million to 10Million on a plot. BUT the trends and pros and cons of any of the sectors/societies can not be perfectly predicted and you can't confidently make up your mind on any specific sector.

And even if we buy our special plot now with the best possible analysis, we can't do the construction while sitting here. Additionally, we don't know what would be our work location? So Zone 1 can't always be the best option if you get to work in Pindi.

There's no perfect solution and you dont wana play the big bet of all your savings on one single location. Right?

At the same time Our expectations would be at least 50% increase in 5 years for investment or the place turns out to be a healthy safe society and gives you a pride living there.

So I thought we brainstorm ideas on Investment Portfolio, lets say, of 10,000,000.

We buy different properties in different sectors/societies. After a year or two, we see the trend, adjust our portfolios by selling low performing properties and buy others and we continue to do it until we go back with the most suitable properties in our hands.

Sell off the extra ones, and build up on the Perfect choice.

So lets put up options:

[bilshd (MBS)]

I would suggest based on approximate rates per my info:

Option 1:

G15/F-15 - 10Marla for 2.5Mn Bahria Town/DHAI - 10 Marla for 2.5Mn E-12 - 10Marla for 2.5Mn Bahria Enclave - 10 Marla for 2.5Mn

Total Area: 40Marla Total Cost: 10Mn

[okhalid_1 (OKha)]

@MBS ... i guess great majority of offices are in Islamabad ... may be more than 90% ... esp. multi nationals ... so when an overseas paki returns he will mostly work in Islamabad i think... so zone 1 or iv should be preference

any ways i'm not sure if investing in property esp land can get more profits than US $ bank accounts (due to rupee devaluation ) or gold or national savings or engro rupiya type investments! .. this has been the trend for the past may years and is likely to continue for many years to come unless by some stroke of luck any unexpected BIG change happens! e.g. like 9/11 etc.

[bilshd (MBS)]

I cant deny this fact that in principle, real estate is not a profitable option compared to gold, stocks, mutual funds or even fixed deposits. But at the same time, many people still consider it, largely for self living. So with that perspective, you might wana set up some real estate portfolio coz there is no One sure option.

[okhalid_1 (OKha)]

@MSB i totally agree! for self-living one should defiantly buy a house… but buying a house or land these days for investment/profit only does not make any sense especially for non-professional buyers …. I guess may be property dealers make money out of it….

[okhalid_1 (OKha)]

@MSB btw you missed US $ bank accounts as one of the best investment options too as rupee is continuously depreciating again the dollar at the rate of 11-12 % for the past few years and you can get a profit of 1.5 to 2 % if you fix dollars so in the end it can turn out better than national savings plus there is no tax on dollars …

[a_m5 (arshad)]

Property is a fairly iliquid asset, as it can take a lot of time to get your money if you need it in an emergency so I think that certain percentage of your portfolio needs to be cash.

[bilshd (MBS)]

Mind u dollar is not appreciating, instead pak rupee is depreciating. Now this means when u convert ur dollArs to rupees , the amount is increased but it has the same purchasing power of initial or principal amount. So u dont make any profit but relatively protected against adverse inflation and exchange rate effects on pak rupee. For reference see the dollar trend of last few years in forex or any other international money market. Biggest slump of dollar was in 2008 against oil prices when it reached above 140 dollars/barrel. Even q4 of 2011 was very bad for dollar. If china had not its foreign reserves in dollars, USA would have gone by now. But this protection may not last long.