Mixed picture in Lahore & Karachi as Islamabad rebounds
The first quarter of 2015 had mostly got off to a stable start across the board. Islamabad’s property market looks to have gained some momentum after posting largely lacklustre numbers on the board over the course of the last 6 months, owing primarily to political disturbances and a consequent spell of decreased activity. Most localities in the Federal Capital showed an upward trend and even though the price rises were small, they might still set the tone for the months to come.
After keeping up a more or less steady path for the last 4 months, prices in Lahore Cantt came down 2.77% in February 2015, with a 1-kanal plot going for an average price of PKR 29,963,158. DHA Lahore continued to follow its gradual upward trend with average prices of same-sized plots registering a 2.00% gain to land at PKR 15,199,937.
Bahria Town Lahore also saw a month-on-month rise of 2.23% for an average price of PKR 10,507,385 per 1-kanal plot. LDA Avenue I plots, meanwhile, did not register a significant change, losing 0.92% in value over the course of February 2015 to land at PKR 9,518,987.
One-kanal homes in Lahore Cantt went for an average price of PKR 36,227,287 in the same time period and pulled in an average rent of PKR 127,695 for a rental yield of 4.25%. DHA Lahore’s 1-kanal houses averaged PKR 35,450,440, while Bahria Town and Johar Town averaged PKR 29,224,338 and PKR 28,922,157 respectively.
This was the first time in a few months that Islamabad’s market showed a uniformly upward trend, with all major localities posting good numbers. While it is too soon to say with certainty how long this trend will continue, it is nevertheless a solid performance that should relieve investors’ concerns.
Sector F-11’s 1-kanal plots gained 2.24% in value over the course of February 2015 and registered an average price ofPKR 50,375,000. Sector E-11 reversed its downward trend with a small 0.75% gain in February 2015, landing at an average priceofPKR 36,162,857. Meanwhile, Bahria Town Islamabad/Rawalpindi gained a decent 1.66% to register an average price of PKR 11,616,981 per 1-kanal plot, and DHA Islamabad’s 1-kanal plots gained 1.62% to clock in at an average price of PKR 12,286,134 in February 2015.
Sector F-11 1-kanal homes went for an average price of PKR 66,096,893 in February 2015 and pulled in PKR 194,138 in monthly rent. Same-sized homes in Sectors E-11 and G-11 averaged PKR 62,327,575 and PKR 55,992,009 respectively.
Gulistan-e-Jauhar was the only major locality in Karachi to register a noticeable gain over the course of February 2015. One-kanal (or 500 square yard) plots in the locality gained 2.77% in value to land at an average price of PKR 11,955,556 over the course of the month.
DHA Karachi, which had taken a major jump in January 2015, underwent an expected correction in February 2015 and prices came down 1.70% to land at PKR 33,585,597 per 1-kanal plot. Average prices in Gulshan-e-Iqbal and DHA City Karachi registered no significant changes and remained at PKR 21,000,000 and PKR 3,774,009 respectively.
One key takeaway from these numbers was the improved performances of Bahria Town’s Lahore and Islamabad/Rawalpindi projects. Because the wildly popular Bahria Town Karachi has been the developer’s centre of attention for a while now, these projects have quietly suffered in the background but are now starting to show some vigour.
Islamabad is a highly popular real estate market, and its downturn for the better part of 2014 had been cause for concern. The first indications of a rebound should be welcome news for investors.
“Even though things have a cooled a bit in Karachi and Lahore, I don’t think there is any reason for investors to worry. This is the first quarter of the year, so observing things closely to identify trends is the right thing to do at the moment,” said Zameen.com CEO Mr Zeeshan Ali Khan.
“In terms of search trends, it is heartening to see LDA City in the list of the most popular localities in Lahore. A new project immediately charting so high in popularity speaks volumes for the demand and receptiveness in the market, which is a great sign for the real estate sector in general,” he added.