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Lahore Real Estate Forum: Property News & Community Talk : ,

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   Muhammad Amjad KSA
Monday, June 6, 2011 07:28 AM 
Reply: >
ASA
I think because of the present budget, current inflation, depreciation of Pak rupee and slump of all business activities will cause the property value go down further. Comment with reasons! :h
Tahir replied on Monday, June 6, 2011 07:36 AM 

Correct !
Faisal replied on Monday, June 6, 2011 07:46 AM 

Property will go down and down and US dolloar will go between 90 to 94,
AG replied on Monday, June 6, 2011 08:24 AM 

1. Budget.
Increase in price of bricks & cement will harm both the construction
industry & property market.
2. Inflation.
Higher Inflation will cause appriciation of property prices.
3. Pak. Rupee Depriciation.
It will make Property attractive for overseas Pakistanis & cause appreciation of property prices.
4. Business Slump.
It will harm everything including property market.

Regards.
abc123 replied on Monday, June 6, 2011 10:59 AM 

Why do we always degrade ourselves? For Allah's sake, please do think and talk something positive.
Javaid replied on Monday, June 6, 2011 11:54 AM 

Dear All

During the period of 2001 to 2005, Pakistanis experienced a tremendous way of earning quick / bulk money through property transactions (files). While all economic experts used to believe that this can't help economy in the long run, many of us kept enjoying the 'easy way' to become rich. Now, if some one is expecting to see the same era again, he will have to wait and rely on his luck and unless "Shaukat Aziz" type of PM takes over, this won't happen. In my opinion, property / real estate is always a good / safe investment but the rate of return and payback period has to be modest (due to the low risk factor). So, don't expect to become millionaire from nowhere, overnight.

Yes - there is a possibility when some one can become millionaire but this has to be a rare / unique scenario - e.g. if u remember what happened to the land owners of New Lahore Airport area - or the ones who had land cutting across Motorway - these opportunities can generate some good profit.

Coming back to budget impact on property values, as per economic theory, whenever there is high inflation, property value will always go up...but we should not enjoy from this situation because even if our property is getting appreciated, the money is leaking BIG TIME from other sources due to high inflation.

May ALLAH bless this country and nation. Aameen
MAS replied on Tuesday, June 7, 2011 06:02 AM 

Amjad I don't understand your logic.

What has present budget done to property. There is no Capital Gains tax on property no increase in CVT.

You don't expect the prices of Food, Clothing, Transport or Energy to go down due to "current inflation", "depreciation of Pak Rupee" or "slump of all business activities" so why do you expect the price of property to go down?

It costs money to develop a new location in terms of construction material and services. Then it costs money to hold a plot until the locality matures. So if the cost would go up why would the price go down?

Property prices are supported by overseas remittances plus demand due to increasing population and its capita income. These days remittances are increasing and the per capita income is stagnant (not falling) while the population is growing.

Property prices can be a bubble when they have increased too rapidly in the recent past (because it results in excess development than demand, but that has not happened lately) or when people buy property on easy credits which is not the case in Pakistan. I agree with Mr Javaid where he says "rate of return and payback period has to be modest (due to the low risk factor)".

High inflation is all the more reason to convert your money into something other than money so why would it hurt property?
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