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OVERVIEW
F
ramadan for example, the market even came to a complete standstill for a while. But despite its share of problems, 2014 saw pockets of excellent growth throughout as well as a stable finish.
This was not the case, however. The year 2014 proved to be slower and more stable, dominated largely by correction as well as low activity as a result of political and security issues. At some points during the year, in and after
As 2015 begins, the prevailing opinion is that it is shaping up to be a better time for the real estate market of the country. what follows is a detailed analysis of the property markets of three major cities – Lahore, Islamabad and Karachi – and their performances in 2014.
or pakistan’s property market, 2014 was not as great a year as its predecessor. property prices around the country had seen their first true boom in many decades in 2013, and many had expected 2014 to offer the same sort of returns.
LAHORE In Lahore, LDA Avenue I and Lahore Cantt performed better in 2014 than they had done in 2013, with prices of 1-kanal plots in both localities rising significantly. For DHA Lahore and Bahria Town, however, the situation was quite the opposite. Both localities had a glorious 2013 but struggled to perform equally well in 2014.
AVERAGE PRICES OF 1-KANAL PLOTS IN LAHORE 2014 LAHORE CANTT Up
15.89%
prices rose by 15.89% in Lahore Cantt in 2014, compared with a relatively smaller 10.52% rise in 2013
AVERAGE PRICES OF 1-KANAL HOUSES IN LAHORE IN 2014 LOCALITY Lahore Cantt DHA Lahore Bahria Town Johar Town
AVG SALE PRICE 35,806,610 35,047,341 28,373,904 28,359,073
AVG MONTHLY RENT 126,720 122,625 90,713 114,941
RENTAL YIELD 4.28% 4.20% 3.85% 4.88%
8.96%
one-kanal plots in DHA Lahore gained only 8.96% on average in 2014, as opposed to a 31.60% rise in 2013
IMPRESSIVE GROWTH
MODERATE GROWTH
BAHRIA TOWN Down
LDA AVENUE I Up
prices in Bahria Town dropped 1.12% in 2014 as compared to a major 39.30% rise in 2013, but prices are on the up so far in 2015
LDA Avenue I’s 1-kanal plots gained an impressive 24.19% in 2014, as opposed to a moderate 9.73% rise in 2013
1.12%
STABLE
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DHA LAHORE Up
24.19%
IMPRESSIVE GROWTH
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Based on number of searches for a particular locality as a percentage of the total searches conducted for plots or homes in Lahore
ISLAMABAD Islamabad’s property market had had a stellar 2013, but 2014 was fairly lukewarm by comparison. no major locality in the Federal Capital even came close to the gains experienced in 2013, and most registered controlled rises at best.
AVERAGE PRICES OF 1-KANAL PLOTS IN ISLAMABAD 2014 SECTOR F-11 Up
3.76 %
one-kanal plots in Sector F-11 gained only 3.76% in value in 2014 after having gained 46.06% in 2013
STABLE
BAHRIA TOWN Down
22.79%
AVERAGE PRICES OF 1-KANAL HOUSES IN ISLAMABAD IN 2014 LOCALITY F-11 E-11 G-11
AVG SALE PRICE 65,222,018 61,739,389 55,584,398
AVG MONTHLY RENT 192,033 190,560 174,771
RENTAL YIELD 3.54% 3.71% 3.78%
After a spectacular 2013 that saw prices shoot up by 115.15%, Bahria Town plots lost 22.79% of their value in 2014
MAJOR DECLINE
SECTOR E-11 Up
6.34 %
one-kanal plots in Sector E-11 gained 6.34% in value in 2014 as compared to the 48.25% rise in 2013
MODERATE GROWTH
DHA ISLAMABAD Up
12.09%
DHA Islamabad had registered a 91.97% rise in prices of 1-kanal plots in 2013, but this growth came down to 12.09% in 2014
CONTROLLED GROWTH
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Based on number of searches for a particular locality as a percentage of the total searches conducted for plots or homes in Islamabad
KARACHI Karachi’s realty market also had a worse time in 2014 than it had had in 2013. with the exception of Gulistan-e-Jauhar, which saw a marginally higher rise in prices of 1-kanal plots in 2014 as opposed to 2013, all major localities struggled to replicate the success of the previous year. However, the city’s realty market performed reasonably well nonetheless.
AVERAGE PRICES OF 1-KANAL PLOTS IN KARACHI 2014 DHA KARACHI Up
11.85%
one-kanal plots in DHA Karachi gained 11.85% in 2014 as compared to an excellent 30.02% rise in 2013
CONTROLLED GROWTH
GULISTAN-E-JAUHAR Up
22.19%
one-kanal plots in Gulistan-e-Jauhar gained 22.19% in 2014 as opposed to the marginally smaller 21.96% in 2013
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IMPRESSIVE GROWTH
GULSHAN-E-IQBAL Up
7.65%
plots in Gulshan-e-Iqbal saw a small 7.65% rise in prices in 2014 as compared to a whopping 65.25% in 2013
MODERATE GROWTH
DHA CITY KARACHI Up
24.28%
plots in DHA City Karachi had gained 27.88% in 2013, but managed a smaller but still impressive rise of 24.28% in 2014
IMPRESSIVE GROWTH
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Based on number of searches for a particular locality as a percentage of the total searches conducted for plots or homes in Karachi
FINAL ANALYSIS 2015 IS GOING TO BE A BETTER YEAR IN TERMS OF ACTIVITY IN THE PROPERTY MARKET OF PAKISTAN, ESPECIALLY IF THE POLITICAL CLIMATE – WHICH HAS COOLED DOWN LATELY – CONTINUES TO REMAIN CALM
Given that 2014 has been a difficult year for a number of reasons, not the least of which is political uncertainty in one form or another, the market has shown remarkable stability. while it is fairly obvious that 2014 has been nothing like 2013, it has been far from a bad year. Although prices and market activity rose and fell in most localities around the country throughout the year, the market ultimately stabilised towards the end and some growth was seen in the last quarter in particular.
“prices cannot continue to rise unchecked forever, and every now and again we are going to see a more sobering year,” said Zameen.com CEo Mr Zeeshan Ali Khan. “I think the controlled growth in 2014 was a result of a correction following the perhaps unrealistic price rises in 2013, along with the uncertain political situation. But 2015 is going to be a better year in terms of activity in the property market of pakistan, especially if the political climate – which has cooled down lately – continues to remain calm,” he added.
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