Pakistan property market facing bloodbath
Property prices started rising after the introduction of Property Tax Amnesty Scheme in November 2016. In many areas prices were increased by 25%. Speculation was once again very high due to the massive inflow of black money. Almost every investor was able to earn high returns in short period of time. But this property boom has come to an end now.
Pakistan property market after Panama Case Decision
Panama Case Decision has collapsed the property bubble in Pakistan. SC has started ruthless crackdown on black money. Property prices are decreasing in every city and town of Pakistan. Currently property prices are 20-25% down from its peak in early 2017. But this is not the end of the story as Pakistan property market facing bloodbath.
Property market’s present trends
Real estate transactions are record low as there are no buyers in the market but just the sellers. Genuine buyers are waiting for the price to be bottomed out so that they can buy affordable properties. Launch of new real estate projects is also record low. Developers are unable to attract the investors even after reducing the prices.
Property market’s future trends
Genuine buyers have low affordability as compared to the people with black money. This is why property prices are falling. Property prices will keep falling to the level where genuine buyers with white money can afford properties. We should be ready for more price fall. When property prices will bottom out, we will see 35-50% price decline followed by long stagnation.
Death of high end luxury property market
Pakistan real estate sector has changed forever. Small size / cheap properties have good demand but high end luxury real estate is unable to attract buyers. This is because that honest tax payer in Pakistan has low purchasing power and cannot buy expensive property. This present real estate property price crash has destroyed the luxury property market in Pakistan.