Why Real Estate is Falling in Pakistan? Reasons


Pakistan real estate industry has been thriving in the recent past. But, will it continue to do so? The question remains intact. It is, however, pertinent to mention that the industry relies on & is connected heavily with the country’s economy. Therefore, the surge of deterioration in the economy does seem to have hit the real estate industry too.

Moreover, from the consumer’s point of view, their investment needs to be lucrative – both today and the coming tomorrow. But, looking at the blurry economical and political conditions in Pakistan, a guaranteed future in real estate might seem vague. In addition, there are other multiple reasons too as to the possibility that real estate in Pakistan is falling.

Real Estate vs Economy

Pakistan’s real estate impact on the economy is massive. Moreover, over 200 industries are connected with real estate, one way or another, affecting the very structure to the core. Apart from this, it contributes over 6% to the overall GDP which is huge.

Now, if the instability from either end is seen, it will have repercussions and consequences for the future. In this article, we will have a look at some of the major reasons that might be the answer to the frequently wondered and asked questions; “Is Real Estate Industry Falling in Pakistan?” or “What future does the industry hold?”

Is Real Estate Falling in Pakistan – Reasons

There are multiple reasons and occurrences in the recent past that could be the reason to answer the above question. Let’s look at them one by one;

Uncertain Political Situation

It is no novel news that Pakistan’s political scenario is unstable and uncertain. Multiple governments shuffling in the span of a few years has impacted all departments of the state. Moreover, the previous government taking the ‘vicious economical cycle’ in a certain direction was disturbed by the sudden overtake of the new regime. Therefore, one might observe the deteriorating belief in the ‘International Market.”

It impacted the real estate industry in a big way. It is so because unstable governments ingrain fear in the real estate market. In addition, it then trickles down to every department. From the developers, realtors or all real estate agencies, and investors to whoever is involved in the whole process.  To put it in a nutshell, the future of real estate in Pakistan depends massively on how soon the political situation is going to settle down.

Imbalanced Economy

The economic scenario in Pakistan is raising a whole lot of questions. Whether it is the deteriorating exports, questionable stock exchange scenario, almost no reserves to rely on, or simply the fact that Pakistan is losing its stronghold in the international market, there’s a lot to think about.

In this situation, the real estate industry is developing a sense of sheer terror. Why? Because there does not seem to have any kind of reliability considering the situation. Both in the present time and the future.

Hyper – Inflation

The sudden boost in prices is also one of the major reasons why the real estate industry might be seeing a weak edge. Investors cannot afford to buy a luxurious lifestyle considering the economy. It includes everything from increased property taxes, to plot prices, hiked-up installments, and more. In addition, there’s also a sense of connotation attached that investing today might not be fruitful in the future as it seems bleak. Therefore, the sudden and strong hike in prices is also a huge reason.

High-Interest Rates

The aspect of higher-than-ever interest rates could be another giant reason. Simply put, interest rates are the extra price that the borrower has to pay. After lending money/loan from any financial institution or bank, the borrower has to pay an extra percentage. It is called “Interest Rate.”

The interest rates are constantly increasing considering all the valid and vivid reasons mentioned above. Therefore, people are afraid to take risks that might have strong repercussions and put them in difficult financial situations.


The real estate industry in Pakistan is not seeing a favorable and pleasant picture.  The reasons are many. We, however, tried to tap into all the major reasons that might result in the fall or deterioration of the industry. Even if we bait an eye, for the time being, it’s no news that the investor/consumer is fearful and hesitant to take the risk. Having said that, we must hope for a bright tomorrow along with an ever-prosperous real estate market that we were leading up to. For further information, ambiguity, or guidance, kindly reach out to Estate Land Marketing – a name of trust and experience.

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