Overseas Pakistanis and local investors can get accurate information if the maps of housing projects and societies are linked with Google Maps, said a report by Competitive Commission of Pakistan.
The use of technology will build the trust of overseas Pakistanis seeking to invest in real estate. Presently, builders and developers usually do not provide accurate information to investors, particularly those staying in other countries.
The general public usually invests its money in immovable properties and is cheated and exploited by builders and developers in Pakistan.
Competitive Commission of Pakistan (CCP) compiled the grievances of the major stakeholders in the report “Issues of Real Estate Sector of Pakistan”.
The commission not only gave an overview of the present situation of the real estate sector including the price factor, unethical business practices, and illegal activities but it also suggested that the government should take urgent steps to facilitate the public in this regard.
Consumers at large demand that measures should be taken to protect their investment such as converting a huge project like Bahria Town into a public limited company. Such measures are necessary to minimize uncertainty and loss in case of the death of a major partner of the entity.
The real estate sector should be declared a formal industry, in accordance with international practices. Various relevant laws are present, but they are not being enforced effectively.
There is a nexus between developers and dealers who are involved in the price fixing of various properties. Developers direct the dealers to charge a certain price for their properties. Prices of files are fixed artificially that are floated in the market at that price. The prices of the same files are also raised artificially.
In most of the cases, the landowner, builder/developer, and the marketing agency are three different parties. None of the parties takes responsibility for problems encountered by the buyers and consequently, it becomes extremely difficult to trace the actual perpetrator and hold them accountable for their fraudulent practices.
There are numerous government agencies involved in the real estate sector with no streamlined framework. This makes it very difficult for buyers, developers, etc., to undergo all the processes required to conduct their transactions, undertake any project with ease and avoid legal and procedural issues in the future.
The CCP report also mentioned illegal activity by builders and developers such as illegal housing schemes, false claims on online forms, delay in possession of the property, overcharging of different heads, hidden charges and etc.
Prices of properties need to be reduced, however, this should not be done by the government’s intervention, and should be done by increasing the supply of houses and other properties.
Bankruptcies are a part of all sectors including the real estate sector. Developers also encounter genuine issues in the sector due to various economic reasons. Therefore, instead of merely blaming them for malpractices, there is a need to investigate why the builders are facing defaults.
CCP asked the government to set up a national level regulatory body of the Real Estate sector which should be integrated with all relevant authorities and also keeps an eye on the malpractices of builders and developers.
This will facilitate investors and buyers to a great extent like many authorities in different countries are doing. Not only will the investment increase from this sector but healthy tax revenues will also be generated.