KARACHI: Political uncertainty has hampered the real estate business as the prices of property have witnessed continuous decline during the past 3 months, real estate agents told Daily Times.
Prevailing political turmoil in the country has compelled the estate agents to search for new markets for real estate business, which declined by 20 to 30 percent during the last one month.
Muhammad Amir Samsaam, an estate agent at Clifton, told Daily Times that the property value had been declining for last one year. The property’s value again started to increase before the elections and it seemed that the real estate business would be revived.
But now the prices have declined again and “the prevailing uncertainty in the country has jolted property value and it has witnessed a decline of almost 40 percent to 45 percent during the last 25 to 30 days”, he said. He informed that plots in Defence phase VIII have also shown a decline of almost 35 to 45 percent, as a 2000 yards plots in DHA Phase VIII is available at Rs 5 million as compared to Rs 6 million one month back.
However, some estate agents were of the view that besides the decline in the prices of the plots, there is also little increase in the prices of constructed bunalows because of high cost of construction due to spiked cement and steel prices after the budget.
Amir further said that a 2000 yards plot in PECHS was available at Rs 4.5 billion an year ago. Now it costs at Rs 3.5 billion in the same vicinity. People are selling their plots at lower rates as compared to 2005 because of the fears of further decline. An estate agent in Gulshan-e-Iqbal said that the property rates are on the decline due to the uncertainty and unrest on the political front. “There had been only a paltry sale and purchase activity during last two months,” he lamented.
These conditions have compelled the investors to invest in foreign countries, causing decline in the property’s value. The estate agents and the investors, after cashing opportunities in Pakistan, are now investing in Dubai, Ajman, UAE, and Malaysia, where property business in on the boom. All the reactors were of the view that the prices of property would further drop in case the political situation remains unstable.