What Are The Pros And Cons Of Property Investment
Fixing money in the property market is not everyones cup of tea. There are both pros and cons of property investment to consider. So, you need to take careful note of them before making your foray into the field.
This breakdown should help you out.
|Pros: Why invest in real estate?||Cons|
|Potential for high returns in a short time||Prices may not go up as soon as expected|
|A solid asset in your possession||Possessing property involves paying property taxes|
|A steady source of income, if rented out||Real estate cannot be liquidated urgently|
|Can be held for future personal use||Property value may fall due to certain situations|
|A good asset to pass over to your kin||Legal issues or fraudulent practices may occur|
Buying Open Land In Anticipation Of Development
This is one of the less common and riskier types of real estate investment in Pakistan. It involves buying open and undeveloped land that is not owned by any society. Investors who go for this approach anticipate that a developer will buy the land from them at higher rates to establish a project.
Currently, buying open land is an ongoing trend in the various mouzas of Gwadar, which are being developed under the China-Pakistan Economic Corridor initiative.
Benefits Of Real Estate Investment In Pakistan
The benefits of real estate investment are numerous and multifaceted. With considerable investment one can earn excellent returns, tax advantages, predictable cash flow and much added benefits. Also, its a great source of building wealth. If you are thinking about investing in real estate? Here’s what you need to know about real estate investment in Pakistan and why property is considered a good investment.
- In real estate investment money is made through rental income, appreciation, and profits generated by business activities that depend on the property.
- The benefits of investing in real property include passive income, stable cash flow, tax advantages, diversification, and leverage.
- Real estate investment trusts guide you the way to invest in real estate without having to own, operate, or finance properties.
Don’t Miss: How Much Money To Invest In Cryptocurrency
Top Five Areas To Buy Properties In Islamabad
Key Features include:
- A smart and eco-friendly residential project in Islamabad
- A myriad of residential and commercial options
- BRT system
- 24/7 gas, electricity, and water
- Sports club, hotels, and shopping malls
- Internet, smart software for weather, electricity, and traffic
- Contemporary housing layouts
- Move n pick resorts and hotels
- 18-hole golf course
Key features include:
- Premium facilities and amenities
Defence Housing Authority , Islamabadproperties in Islamabad
Key features include:
- Restaurants and cafes
Bahria Town, Islamabad
Key features include:
- Plenty of commercial options and for shops and offices
Park Enclave, Islamabadproperties in Islamabad
Key features include:
- State of the art healthcare facilities
Build Equity And Wealth
As you pay down a property mortgage, you build equity that means an asset that’s part of your net worth. And as you build equity, you have the leverage to buy more properties and increase cash flow and wealth even more.
Cash flow means the net income from a real estate investment after mortgage payments and operating expenses have been made. A primary benefit of real estate investing is its ability to generate cash flow. In many cases, cash flow only strengthens over time as you pay down your mortgage and build up your equity.
Don’t Miss: Alternative Investment Due Diligence Checklist
Collection Of Valuable Arts
Investing in artistic values and collecting: stamps, books, money, paintings, art objects, exclusive jewelry, cars and antiques
This investment is one of the most luxurious and romantic ways to increase capital. There are two problems: the first it is costly to buy such things, the second is exceptionally illiquid investments, it is complicated to find a buyer for the collection. However, if you have big money and appropriate links, then go for this option.
It also requires high investment, as valuable art is very expansive and only affordable to rich people. You need at least 5 lac to buy a little thing.
Facilities For Overseas Pakistanis To Buy Property In Pakistan
Property investment for overseas Pakistanis has become easy as OPF itself has established housing schemes in different areas of Pakistan. Plots in these housing schemes, as OPF claims, have been allotted to overseas Pakistanis. These schemes are located in Islamabad, Gujrat, Lahore, Dadu, Peshawar, Mirpur and Larkana.
Rule No : Become A Tax Filer
Government is tightening noose around non filers so it is very important that you must file your taxes immediately. On a more personal note if you are working abroad , chances are that you file your tax returns regularly, therefore it doesnt hurt you as you will only pay for any profits you make in Pakistan on your property.
A lot of Expats are confused about filing of Tax returns in Pakistan and some fear that our system is not fair. I do not agree though, i believe that while local tax filers may face some issues because of complicated systems involved in tax filing but we must remember that the system is still evolving however for the Expats it is very crystal clear and offers great financial benefits.
On every major transaction you will save hundreds of thousands and it only costs 10000 PKR a year to file your taxes.
Unlike before now you can not become a tax filer at any time of the year, you must submit it by the end of tax year and if you fail to do so , all transactions you do in that year will be considered as non filer transactions and you will pay extra taxes.
How To Start Investing
If you are planning to invest and need some guidance and essential points to remember so you can build an excellent investment portfolio of yourself, then here are some tips and suggestion which can help you to get on track:
- Do proper research First things first, find answers to initial questions like how much amount of money you can afford to invest, what are your best options, and what sorts of venture items can help you to reach your goals.
- Be acquainted with investment risk and threats Analyze how much risk you are ready to take and also what sorts of investment items will help you to reduce risk factors. Various investment items have diverse levels of risk with them, so it is your job to realize the risk which is involved in every investment opportunity or strategy which you are thinking about.
- Consult with professional or an adviser As you are starting new investment plans, Do not consider yourself as an expert have a meeting with professionals and ask them as many questions as you can so you can understand every aspect of your investment strategy. Organize several meetings with such professionals and experts.
As you can see, there are many investment options for every taste and any starting amount. The main thing is not to be afraid of anything, to start, not to stop gaining knowledge and experience, and not to let things go by themselves. To paraphrase famous lines, do not make money being lazy. Work for the result.
Also Check: Get Money To Invest In Real Estate
Reasons Of Investment In Pakistan For Expats
One of the major reasons of investment in Pakistan for expats is that Pakistan is undergoing rapid economic development. Overseas Pakistanis invest in Pakistan in a number of sectors. From agriculture, retail, IT & telecom, power & energy, mining, tourism, textile, pharmaceutical, automotive to financial services Pakistans investment scene is ripe with multiple opportunities for overseas Pakistanis. Detailed policies and acts have been shared by Investment Facilitation Centre of OPF.
Which City Is Best For Property Investment In Pakistan
74 total views, 2 views today
Finding the best possible spot in the best city of Pakistan is a troubling question for investors of varying backgrounds and ethnicities, and generally, it requires being indulgent in the act of making bold comparisons by keeping and analyzing the data of all the influential and big cities side by side. Theres another way, however, which requires nothing more than going through this article while saving yourself an hours-long project of research.
You might be wondering how the real estate market is functioning these days before triggering the option of investment, and I can ensure you it has a tremendous potential to give you significant ROI, and a chance to gradually accumulate a vast sum of fortune that only the executive class of Pakistan boasts about. And on top of that, the issue of predatory conditions, designed and set in place by the influential land mafia, which also flexes fortunes owing to its protracted history in the real estate market, are gradually being suffocated and made extinct by FBR and the legal bodies in Pakistan.
Sukh Chayn Residence, Islamabad
Astoria, Bani Gala, Islamabad
ManagementThe management of this city is persistently devoted to the task of ensuring the inhabitants a great living experience as we see the health, education, law and order, and other conveniences of life to be delivered at their maximum potential.Safety
DHA Defense, Islamabad
Gulberg Green, Islamabad
Recommended Reading: I Want To Start Investing My Money
Sky One Real Estate & Builders
Sky One Real Estate & Builders is a Bahria Town Karachi authorized dealer. SKY ONE Real Estate & Builders is well-known for its extensive industry knowledge and unwavering commitment.
Their success is founded almost entirely on positive word-of-mouth referrals. For the past 12 years, they have been offering services in the real estate industry and developing residential and commercial buildings in BAHRIA TOWN.
Best Commercial Property Investments:
Graana.com offers state commercial art properties to its esteemed customers. These hot selling projects are located at prime locations in Pakistan. They offer good returns, straightforward terms and conditions and a chance to safeguard your money for the future.
Currently, the following commercial real estate projects are being offered by Graana.com.
You May Like: What Type Of Real Estate To Invest In
Trends Of Real Estate Business For The Year 2021
The real estate industry is emerging in Pakistan at a faster rate than ever before. However, when Covid 19 hit in 2020, the sector experienced severe losses across the board. Every sector of real estate, primarily industrial, suffered a severe economic imbalance. In this time of financial instability, the interest rates for the property dropped, and the investors took advantage of it by investing in different housing schemes and other valuable properties.
The experts in the real estate industry projected that 2021 would bring favorable winds for investment in Pakistan. This prediction was based on the increase in value of different types of property over the years, and that return on investment is experiencing a constant high. Moreover, the investors who retained properties for 4 to 5 years stand to make significant profits by selling them. All these factors are proven to be notable influencers in driving people to invest more in real estate. Therefore, this industry is expected to grow exponentially this year. These investments will be located in upscale residential societies such as Etihad Town and premier projects like Union Luxury Apartments.
Is Commercial Area The Best Real Estate Investment In Pakistan
Pakistans real estate market is one of the few that provides a wide range of investment choices. These profitable solutions not only allow you to keep the real item, but they also allow you to obtain rentals and a high return on your investment.The real estate market in Pakistan is gradually growing in popularity. Also, Pakistan real estate forecast 2021 indicates that people are becoming more aware of the attractive returns on their investments in this field. As a result, interest in commercial real estate is rising as its becoming one of the best real estate investment in Pakistan.However, we realize that many people are unsure whether or not to invest in real estate commercial areas, so dont worry, we are here to alleviate your fears.Lets discuss the Commercial Area a little bit more.
Don’t Miss: How To Invest In Physical Silver
Real Estate Or Property Business
Considered to be one of the best investments in Pakistan, real estate is a highly growing rewarding investment. With more residential and commercial areas being built, real estate can help your investment grow within no time. To the best, real estate investment comes in many ways. REITs are one of the major sources where your investment can be part of the larger investment group.
Properties are your passive income source. With small installments, you can buy any plot, any shop, and then you can rent it out. It gets you monthly income in the form of rent. Moreover, these days, investments with groups are a major investment plan. People tend to make groups and then invest their income collectively. It gives an investor the chance to invest without any thinking of the larger investment plans.
In the future, if you need investments for some other business, you can sell any of your property and make fortunes with the other business venture. Therefore, properties have a strong asset value. Properties give you back with the best return ratio.
Rule No : Bypass Marketing Gimmickeries
Unfortunately Expats are an easy target of high end marketing campaigns and a lot of developers take advantage of their lack of on ground knowledge and information. If you keep yourself limited to recommended areas as suggested above above you do not need to worry much. However if you are willing to take higher risk than make sure that you do not fall in to the hands of those marketing geniuses.
Normally a marketing company will be using a selling concept to achieve its goals in short time. Such a strategy will put developers interest ahead and the only goal is to sell the project and not to focus on the purchaser.
It is therefore best to use third party consultants who can provide you with an in-depth neutral analysis and offer you comparisons of various projects in the market and more services than what you are getting when you purchase directly.
Pakistan Real Estate Forecast 2022
The government of Pakistan has lowered the interest rate and announced incentives for the investors and businessmen to mitigate the economic impact of the pandemic last year which resulted in the development of many budget friendly real estate projects in which investors had invested a lot due to many reasons. This effect can be seen extending towards this year too.
Many Pakistani citizens and overseas Pakistanis are investing in the real estate sector making it the more successful sector of the country at the moment. Real Estate Investment in 2022 in Pakistan is being more encouraged than any other sector due to the profits and benefits.
Must Insist For The Original Copy Of The Registry
During negotiating for any investment options being Pakistanis living abroad, you must request the seller to produce the original copy of the title document, registry, or allotment letter. Keep of such documentation for verification by yourself through some professional real estate agents like ZEM Builders.
ZEM Builders Islamabad, being a professional real estate agent can help you out to get the documentation verified from respective authorities anywhere in property hubs like Islamabad, Rawalpindi, Lahore, and Karachi.
Read Also: What Is A Personal Investment Plan
Which Real Estate Investment In Pakistan Is Right For You
Making the decision between commercial and residential real estate investment in Pakistan is not simple and can not be made overnight. Each option comes with its own set of benefits and challenges. The final decision has to be made depending on the investors short- and long-term goals, risk tolerance, liquid money, and time.
Best Housing Societies In Pakistan
The Pakistani real estate market is getting better by leaps and bounds. It is considered to be one of the most lucrative business investment opportunities in Pakistan and for all the right reasons. High returns, security, and financial freedom are some of the most highlighted pros of real estate investment in Pakistan.
One of the best ways to invest in real estate in Pakistan is by getting a plot or a house in a verified housing society in Pakistan. In this blog, we bring you a concise yet informative list of the 6 best housing societies in Pakistan.
To know more about these best housing societies in Pakistan, keep on reading.
Recommended Reading: Step By Step Guide To Investing
Do Not Use Doubtful Sources Of Information
Unfortunately, there are a lot of useful virtual sites on the Internet that offer attractive but dangerous strategies. Refer to official sources sites of certified brokers only.
Moreover, serious companies have available mobile applications this way, you can invest and monitor the movement of your money in real-time, wherever it is convenient for you.
Safety Of Investment Is The Foremost Aspect That Should Be Kept In Mind
The safety of investment is the first and foremost aspect that should be kept in mind before investing in any real estate in Pakistan. If the project is undertaken by some government bodies like Capital Development Authority , Lahore Development Authority , or autonomous regulated bodies like Defense Housing Authority and Pakistan Armed Forces , then it is believed to be safe for investment. If the project is not directly administered by government bodies and is launched by private sector real estate developers, then it should have necessary approval in place from the respective government bodies in the city. If the government approvals are yet to be granted, the project may have missed some critical prerequisites and might not be able to get the necessary approvals in the future. If so happens, the investment made there might be ruined or may not be fetching desired results. So, while hunting for the best investment options for Pakistanis living abroad, one must opt to invest in government-approved projects only.
Recommended Reading: Investment Adviser Registration Fees By State