Islamabad, Mar 28, 2025: Industry analysts predict that Pakistan’s real estate sector is poised for a strong recovery after a two-year slowdown, driven by improved macroeconomic conditions and a consistent rise in remittances from overseas Pakistanis.
With commercial banks reducing savings rates in line with policy rate cuts, investors are now seeking alternative opportunities.
The stock market, having reached its peak with increased risks, has prompted many to turn to real estate as a secure and lucrative investment option.
According to Anosh Ahmed, a real estate investor based in the United States, high-end residential communities and luxury housing schemes remain particularly attractive to investors, especially expatriate Pakistanis looking for stable investment avenues.
Developers, both local and international, are introducing innovative residential concepts to enhance living standards.
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These housing societies cater to upper-middle-class and high-net-worth individuals who aim to secure their capital for significant future returns.
Ahmed highlighted that flexible payment options are making property investments more accessible.
Many housing schemes offer installment plans where buyers can pay 60% to 70% upfront, with the balance distributed over monthly payments akin to rental expenses.
Additionally, declining interest rates have led to a surge in housing finance schemes by banks.
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If the government or financial institutions introduce specialized low-interest home financing options, they could further stimulate both local and foreign investment in real estate while boosting related industries such as construction and raw materials production.
According to the State Bank of Pakistan (SBP), mortgage loans climbed to Rs246 billion by September 2024, up from Rs211 billion in December 2023.
The central bank’s decision to reduce the policy rate from 20.5% to 12% has further lowered borrowing costs and increased the demand for housing loans.
Maaz Liaquat, a real estate consultant and former official of the Defence and Clifton Association of Real Estate, observed a steady rise in property transactions in prime locations of major cities over the past few months.
Buyers and investors are increasingly interested in new development projects launched by both local and foreign builders, particularly in coastal and upscale urban areas.
However, investment in plots remains subdued due to heavy taxation imposed by the government, which has deterred speculative trading.
Most real estate buyers, including overseas Pakistanis and long-term investors, are focusing on generating income through rental yields and resale profits.
Many entrepreneurs and investors who previously relied on stock market gains and bank profits are now shifting their capital towards real estate due to its stability and potential for high returns.
Several UAE-based developers are actively working on large-scale residential and commercial projects in Pakistan. According to SBP data, the country has attracted over $14.6 million in foreign direct investment in the real estate sector between July and February of the 2024-25 fiscal year, highlighting the growing confidence of international investors in Pakistan’s property market.
