Real estate has been a major contributor to the socio-economic environment of Pakistan. As also indicated in the report presented by the State Bank of Pakistan, the GDP of the country is majorly impacted by the country’s real estate market.
Based on the factors of attaining a major profit from it, people invest through different channels for a long-term plan to multiply their sources in the future.
In the past decade, we have seen an unprecedented real state boom where dozens of societies have sprung up across the country, virtually redefining the property sector of Pakistan.
The focus of all these projects is based on grasping the attention of the investors by ensuring the comfort that these societies provide in the form of various facilities.
When it comes to considering real estate, certain questions pop up in mind such as:
- Why it is scaling and expanding with every passing year?
- Why no other business is making that much of a profit as real estate in Pakistan?
- What are the factors that contribute to the success of real estate?
- Why is the demand for real estate increasing day by day?
- What factors assist people to decide on investment in real estate?
These, and many such questions are observed being discussed and asked in social circles strengthening the interest of people to invest in real estate. In order to answer these questions, we will be focusing on different aspects or factors that contribute to the demand for real estate in Pakistan.
The following factors will be discussed in this write-up:
- Demographic
- Interest Rates
- Availability of Opportunities
- Investment from Overseas Pakistanis
- Government Strategies and Policies
- Economy of the Country
- Socio-political Condition of the Country
Demographic
The demographic analysis informs us about the
- Various groups of people
- Needs of the people
- Interests according to the social circle
- Social background
- Age
- Gender
- Habits and many more.
Based on the data the people are grouped according to their similar and different traits making specific categories from general ones.
The demographic analysis and the data collected can be interpreted that how people and their traits influence real estate. For instance, a maximum number of retired people in a country can positively impact the rise in Real Estate. Likewise, if the demographic of the country represents a greater ratio of children, then, comparatively the real estate can be down in the market.
The age demographic of Pakistan represents that approximately 64% of the people are categorized under the age of 30 and 29% are among the 15 to 29 age group. This ratio depicts that the majority of Pakistan’s population consists of young people who earn creating an independent environment along with having strong purchasing power and a mindset to invest.
Obviously, as the result supports the rise in Real Estate so most people opt for it and invest in property influencing it. Hence, it can be said that the people in any country hold a significant position in determining the future of the Real Estate business.
Interest Rates
Interest rates also have a great impact on the rise of real estate. The greater the interest rate, the lower will the market value of the real estate business. In short, we can say that it has a direct relationship with interest rates.
As we all know that the previous two years have been a tough phase due to COVID 19 for people belonging to different spheres of life. Based on it, the government of Pakistan has reduced the interest rates and taxes along with increasing incentives to assist the investors to contribute to the business of Real Estate.
This factor is contributing to influencing it with a forecast of a bright future so if you can invest in it, this is the right time you can gear up your income by making a profit in the coming years through one decision that you need to take today.
Availability of Opportunities
The availability of opportunities in a country is the justification for how fast a country is prospering taking the responsibility of its people in terms of opportunities for them for a source of income. The more the opportunities, the better they will result in the demographic of more people earning, resulting in a mindset that will invest to increase the money in the future.
The employment opportunities are proof that a country is having a strong capital and purchasing power of the people is also great to invest in the business of Real Estate. It indicates the independency of people of a country giving a predication that how many people are able to contribute bringing a positive impact on business.
Investment from Overseas
Investment from the overseas or international community can speed up the business of real estate. It not only brings money from the outsider but also people bring with them their ideas, manpower, machinery, and many more that can contribute to the development and progress of the business of real estate.
However, this factor depends a lot on the policies of the country and economy. A country with a stable country can attract maximum investors from the international community than a country with economic and socio-political fluctuation.
Moreover, we all have seen the disruption in the capital throughout the world due to the COVID 19 pandemic that resulted in high-interest rates, unemployment, and economic fluctuation.
It is, therefore, necessary to have a stable and trustworthy market value for the investors to attract them as any kind of vulnerable situation can lead to the downfall of real estate. Hence, not only people from Pakistan but overseas also contribute to the development of the business of Real Estate.
Government Strategies and Policies
Government strategies and policies also play a vital role in the development of real estate. It can be done if the government is flexible enough to provide incentives, tax credits, subsidiaries, reductions, and loans along with a focus on strengthening the economy.
This can assist in the flourishment of real estate. However, if the policies of the government are strict then it can adversely impact the market of property and business. Moreover, it can lead to attracting people from the international community resulting in a strong foundation for the economy and growth of the society.
The Economy of the Country
The economy of the country can be a leading element to influence the business of real estate.
It is obvious that people would love to invest and put their money from where they have trust to gain a profit rather than living in confusion about what will be the future of the investment?
In order to gain investment, a country needs to have a strong economy that can be assessed based on the opportunities for employment, prices of goods, manufacturing rate, GDP, and many more. The economy and real estate have a direct relation as the stronger the economy, the stronger the business of Real Estate will be and vice versa.
Socio-Political Condition
Socio-political condition decides the economic growth and interest rates in a country. Based on the heated social or political conditions, the business can get affected the most due to fluctuation in the economy of the country and rise in prices ultimately hiking the prices of property.
Hence, a stable social and political condition is a prerequisite for the progress of the real estate business. Also, a stable condition of a country with respect to society and politics also provides proof of trust in the market of that specific country attracting investors not only from the country itself but also from the international community.
The real estate business and investing in it can be a way to multiply your source many times if the decision is taken at the right time taking into consideration the above-mentioned aspects.
If the time is right along with all the factors, then this is your time to invest to secure a future in one of the leading businesses. However, with various situations, it can go up and down as indicated in the article but ultimately if invested in the right place it can bring well when the situation becomes stable as we have an example of COVID 19.
