Mortgage financing, vertical developments can resolve Pakistan's housing shortage

Pakistan Property Show presents almost 200 of the country's best and most trustworthy projects



Zameen.com CEO Zeeshan Ali Khan and Director-General of the Dubai Land Department Sultan Butti bin Mejren at the inauguration of two-day show in Dubai on Saturday. — Supplied photos
Zameen.com CEO Zeeshan Ali Khan and Director-General of the Dubai Land Department Sultan Butti bin Mejren at the inauguration of two-day show in Dubai on Saturday. — Supplied photos
by

Muzaffar Rizvi

Published: Sun 11 Sep 2022, 3:29 PM

Last updated: Sun 11 Sep 2022, 3:30 PM

With growing population, Pakistan is facing a serious issue of housing shortage that can only be resolved by introducing vertical developments and promoting mortgage facility to ease financial woes of the customers, says an industry veteran.Z

Zeeshan Ali Khan, chief executive of country's leading portal zameen.com said the introduction of the mortgage facility in the country would be vital to the real growth of the housing market.

"There is no quick solution to the housing shortage issue, a long-term solution could be the promotion of mortgage financing in the country. Currently, Pakistan’s mortgage finance to GDP ratio is currently at 0.23 per cent compared to the South Asian average of 3.4 per cent and we have no choice but to bridge this gap to overcome housing shortages in the country,” Khan told Khaleej Times on the sidelines of Pakistan Property Show, which concluded on strong note on Sunday.

Rising demand, growing population

Pakistan is experiencing a rise in urbanisation, which has exacerbated the housing shortage problem. By 2025, Pakistan’s population is expected to reach 242 million which will drive demand across sectors. Furthermore, about 44 per cent of the country’s population is expected to be inhabiting the urban centres of Pakistan by 2030.

Zeeshan Ali Khan said houses and residential properties are also getting more expensive, making it difficult for single unit families to afford even a 5-marla house that can cost anywhere between Rs15 million to Rs30 million today.
Zeeshan Ali Khan said houses and residential properties are also getting more expensive, making it difficult for single unit families to afford even a 5-marla house that can cost anywhere between Rs15 million to Rs30 million today.

“This will invariably lead to an increase in housing demand and further exacerbate the housing shortage in the country. The current housing shortage in the country stands at 11.4 million units, which is expected to increase to 17.2 million units by 2025,” Khan said.

Moreover, with regards to the housing shortage problem, Pakistan lags far behind its peer countries in the region such as, Bangladesh, Sri Lanka and India. The housing shortage in Pakistan stands at 31 per cent of the total population of the country, while India has the lowest at 11 per cent in the region, despite being amongst the most populous countries in the world.

Vertical developments on the rise

To better utilise the land resources available, Pakistan is focusing on the construction of vertical developments. The trend of apartment living is already on the rise across the country’s major urban centres and it is expected that this significant change in consumer habits could be the best solution to overcoming Pakistan’s housing shortage.

Zeeshan Ali Khan, Sultan Butti bin Mejren and other guests and officials at the Pakistan Property Show, which concluded on Sunday.
Zeeshan Ali Khan, Sultan Butti bin Mejren and other guests and officials at the Pakistan Property Show, which concluded on Sunday.

“Over the past few years, especially after the impact of the Covid-19 pandemic was mitigated across the country, the focus of the real estate sector seems to have been on the development of high-rise apartment buildings. I have always believed that developers, no matter what type of development they promote, ultimately create the demand; consumers will eventually follow,” Khan said.

“As a result, several high-rise projects are currently in the development phase, the trends in the property market indicate that the consumers are increasingly interested in investing and buying these projects. In the next three years, a majority of these developments are set to be completed and delivered, significantly altering the makeup of the local property sector and impacting on consumer preferences, with a greater emphasis on apartment living,” he said.

“High rises have also become popular due to the worsening urban sprawl. Because cities are becoming overpopulated and horizontally stretched, vertical development is future of Pakistan,” he added.

Housing becomes expensive

Khan said houses and residential properties are also getting more expensive, making it difficult for single unit families to afford even a 5-marla house that can cost anywhere between Rs15 million to Rs30 million today.

Moreover, due to the improved oversight from the government agencies overseeing the real estate sector, developers will have no option but to meet their pre-determined delivery deadlines — with many projects expected to be completed and delivered within the next three years, he said.

This year’s, event is even bigger, with a larger venue, and more than 60 exhibitors showcasing almost 200 of Pakistan’s best and most trustworthy projects.
This year’s, event is even bigger, with a larger venue, and more than 60 exhibitors showcasing almost 200 of Pakistan’s best and most trustworthy projects.

“Zameen Developments is among these developers, and I can assure you we have every intention of keeping our word and adhere to our pre-established timelines,” he said.

Strong regulator needed

Khan said real estate in Pakistan has operated informally for a long time, and Zameen.com takes great pride in our efforts to change that trend.

“For this reason, the company has always supported reforms that may have a positive impact on the local property sector. However, we should be aware that at the ground level, the mechanisms that govern this sector remain steeped in tradition and will only improve gradually through constant attention and upgradation. As a private entity and there is only so much we can do – ultimately, the onus is on the government,” he said.

“An authority is already being established to regulate the property sector is already underway. However, as with any new policy, there are still a lot of questions that need to be answered to determine the efficacy of this initiative. Involving the developers, estate agents and all other relevant stakeholders, and asking them for suggestions and feedback will help build confidence in any government authority created to oversee the real estate industry,” Khan said.

In addition, he said the government will also have to work out a method to ensure that any property regulator can work in tandem with other parallel authorities that oversee the country’s property sector, and to ensure that all requisite NOC’s, approvals etc are issued within the predetermined timelines.

“Once a strong property regulator has been established, it should take the lead in promoting mortgage finance in the country by bridging the gap between the banks, consumers and developers,” he said.

Property show is getting bigger and better

Khan said the Pakistan Property Show is getting bigger and better serving 1.5 million Pakistani diaspora in the UAE since its first edition in 2017.

“The Pakistan Property Show has been Zameen.com’s premier real estate event in Dubai over the last few years and we are very proud to say that over 55,000 people have attended the events to date,” he said.

This year’s, event is even bigger, with a larger venue, and more than 60 exhibitors showcasing almost 200 of Pakistan’s best and most trustworthy projects. Overseas Pakistanis living in Dubai and the UAE will have the opportunity to discover the best of Pakistani real estate, all under one roof.

Additionally, they will discover new real estate projects that they were previously unaware of, developers of these projects will gain more exposure, especially in foreign markets.

A discussion panel was also featured at this year’s event that included senior members of Zameen and EMPG’s senior management, high level dignitaries, and leading journalists from Pakistan, who discussed the reasons why Pakistan’s real estate sector continues to be a great investment.

“So, we would like to call upon all those looking to invest or buy a house back in Pakistan to visit the Dubai World Trade Centre today to get connected with the best property developers, real estate agents and projects available in the country,” Khan said.

He said the Pakistan Property Show has always received an incredible response from the people of Dubai, with last event alone recording more than 15,000 attendees. “All the projects that are marketed and sold by Zameen.com are approved by relevant authorities which guarantees delivery of projects within the committed timelines,” Khan concluded.

— muzaffarrizvi@khaleejtimes.com


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