The real estate markets of Lahore and Karachi have been witnessing favorable trends since the beginning of the year. However, the same cannot be said for Islamabad, where the property sector lagged behind and showed a slow performance during the first half of 2016.
According to the stats meticulously maintained by Zameen.com, DHA Lahore’s Phases VII to IX showed controlled growth, and Bahria Orchard and LDA Avenue I impressed investors by posting more-than-moderate numbers during H1 2016. Bahria Town (proper) also caught investor interest, but could not outshine Bahria Orchard in terms of investment activity. DHA Lahore’s Phases I to VI and Wapda Town, on the other hand, remained stable during the first half of the year.
In the port city of Karachi, property prices and transactions saw an upward trend. Bahria Town Karachi (BTK) fared remarkably well and DHA City Karachi (DCK) also showed a considerable increase in property values. DHA Karachi did not share the same fate, however, showing mediocre performance.
Where the property markets of Lahore and Karachi thrived, they dragged Islamabad behind, as almost all prominent areas of federal performed sluggishly with the only exception of DHA Islamabad.
During H1 2016, DHA’s projects topped Zameen.com’s charts of top 5 localities for plots and homes. However, the only exception to this was Karachi’s plot category.
As expected, sale-purchase activity slowed down during the holy month of Ramadan, however, the prices remained reasonably stable. The real-life implications of the Budget 2016-17, which levies new taxes on the property market, have yet to be seen and will only be discernable in the time to come.
As mentioned in the Overview, Lahore’s property market performed remarkably well during H1 2016 and prices spiked in various localities. Prices of 10-marla plots in DHA Lahore’s Phases VII to IX increased 13.48%, placing them high on the list of coveted areas for real estate investment. The 10-marla lots of Bahria Orchard also performed remarkably well, as prices of these lots rose substantially by 23.08%. Meanwhile, for the value of 1-kanal plots in the locality, the observed trend was moderate growth.
Despite legal complications, LDA Avenue I also saw controlled growth in the value of 1-kanal plots and exponential growth in the value of 10-marla plots. Wapda Town and DHA Lahore’s Phases I to VI, however, showed mediocre numbers.
Investors were disappointed with the performance of the capital city in the first half of the year. Controlled growth was observed only in DHA Islamabad’s 1-kanal and 10-marla plots. This locality performed well because of the ongoing construction of the signal-free Islamabad Expressway, and the development work that the DHA is carrying out in several parts of DHA Islamabad.
Meanwhile, Bahria Town Islamabad/Rawalpindi, Sector B-17, Sector E-11, and Sector F-11 suffered with unexceptional numbers. Bahria Town alone showed a decrease of 10.20% and 6.45% drop in prices of 1-kanal and 10-marla lots respectively.
Sector F-11’s commercial properties showed better activity due to the Capital Development Authority’s strict new policy towards non-confirming use of residential properties in the city.
The property market of the port city of Karachi improved sharply during H1 2016. As per the data collected by Zameen.com, DCK performed remarkably well, as the prices of 500-yard2 plots increased 23.91%. However, DCK property values are still not on par with those in DHA Karachi (proper). So, investors are naturally attracted to the former locality.
Development work in BTK is on schedule and a steady rise in prices is evident in the locality. During H1 2016, prices of 250 yard2 plots in BTK increased 11.82%.
Gulshan-e-Iqbal, on the other hand, showed stability and did not impress investors, as moderate growth was the order of the day for the value of 250 yard2 plots in the locality.
In Lahore’s realty scene, DHA attracted major investor attention in H1 2016. Development work was initiated in Prism 9, propelling property values in the area, while in the case of Phases VII and VIII, it is anticipated that possession will soon be granted, making people capitalise on the locality.
Bahria Orchard also showed significant growth because of relatively low property values and greater growth margin, but Bahria Town (proper) still faces the issues caused by the southern loop of Lahore Ring Road. For this reason, Bahria Orchard outshone Bahria Town in H1 2016. Let’s see how the future unfolds for these two localities. While LDA Avenue I is showing continuous growth, investors should be careful regarding litigious plots in the area.
Islamabad’s realty sector languished in the first half of 2016; however, DHA Islamabad remains one of the most sought after avenues for investment. Prices are expected to rise in the locality with the completion of the signal-free Islamabad Expressway. Bahria Town Islamabad/Rawalpindi failed to retain investor attention due to other up-and-coming Bahria Town projects in Lahore and Karachi. Resolution of issues in Block D of Sector B-17 will be a catalyst in increasing investment activity in the locality in the future.
“The first half of the year has proved to be promising for the property sectors of Lahore and Karachi. However, we are not too taken aback over the slow performance of Islamabad’s property market, as it still has a potential to grow,” said Zameen.com Chief Executive Officer Zeeshan Ali Khan.
The port city is expected to show even more growth in H2 2016. Due to better law and order in Karachi, investment activity in the property market is sure to be on the rise in the near future.