Pakistan’s real estate industry contributes a large part in the overall economy. And it is one of the sectors that generate the most jobs and wealth in the economy. Even though the real estate industry is a stable sector to invest in, but the economic and political instability have made the investment in this sector a lot more challenging.
There are many challenges in the industry over the years faced by the investors. The world hasn’t been able to heal from the covid destruction. The hit by the virus has played a great part in the overall instability of the real estate industry.
Over-Regulation
One of the main reasons, why the real estate investment is obliterating is the high taxes on the investments. After the taxes imposed by the government over the years the whole sector investment is shrinking. Ban on non-filers and other FBR restrictions have discouraged the investors and due to this phenomenon, the real estate industry is crumbling, and it is in a volatile state.
The high taxes and strict regulations make it harder for the overseas Pakistanis to invest the industry, which is not a good indicator for our society and economy. Too many formalities and strict regulation for overseas investors is never a good thing. They don’t get high returns in profit causing them to divert the investment to other countries with a stable and developed economy. The infrastructure of Pakistan is also weak hence causing the distrust in the investors regarding the investment.
Fast Changing Policies
There has been a lot of economical changes since 2017 and the recession regime in 2018, causing a lot of economical, industrial, and political issues. These issues caused lack of confidence and changes in the real estate policies. The fast-changing policies makes the investors lose trust and confidence in any investment. Especially for overseas Pakistani who are not even in the country to adjust with the pace.
So usually, the investors start backing out and it causes a strain on the economy of Pakistan. During the online surveys it was found out that most overseas Pakistani are interested in investing in Pakistan especially in the real estate industry. But Pakistan’s rank out of the 129 countries have decreased a lot. Due to the economic pressure, changes in the policy and the strict regulation the overseas investors pull their investment form Pakistan and divert them elsewhere.
Safety of investment
One of the prime concerns for the overseas investors is the safety of their investment and are the development speedy or not. Are the developers trustworthy? And what kind of plans the will be following and how they align the guidelines provided by the government of Pakistan.
There have been a lot of fraud investments and in most cases the investment is not even recovered. Due to these obvious reasons, the overseas investors are hesitant to put their money in Pakistan’s real estate industry. The projects have good plans and yet they are never complete making it easier for investors to lose their money rather than earning safe profits.
The assurance and security of the investment is important to any investor. The government is taking more initiatives to help overseas investors invest in Pakistan without having to worry about how it is going to work and whether they will receive any profit on it.
Some of the great options to invest in Pakistan real estate sector is to invest in development started by the governmental bodies that are authorized and have a high completion rate. Such as Smart city overseas block (Islamabad and Lahore), Bahria Karachi Overseas block, Princeton Farms Barki road Lahore etc.
Government is taking steps to ensure that your investment is safe and to bring in the market and cash flow in Pakistan to stabilize the economy.
