Real estate industry in Pakistan is booming with success. The land is rich with all kinds of real estate development as well as newly emerging projects that appear on the horizon by the day. Real estate business is a balance of supply and demand. As the demand for new housing and commercial services goes up, the real estate market develops further with new and modern residential and commercial projects that make the real estate market to expand.
Over the years many reputable property developers have settled themselves in the major cities of Pakistan, whether it be the high rise buildings in Lahore, to the concept of city within a city provided by Bahria Town in major cities of Pakistan, to many kinds of properties like houses, plots, shops and apartments for sale in Islamabad that are highly desirable to investors.
When it comes to the investors in real estate market, there is a diverse mix ranging from professionals who have been working for years to new comers to the promising business of real estate. Where the professionals have settled themselves into the ever growing industry, it can be a bit confusing for new comers to figure out the basics of investment. For such individuals who are either new to the industry or are trying to find a home for sale, we will present the most important factors to look for when buying out any property.
Property location:
Location of property is the key that everyone seeks in real estate development. Whether you are sitting at home and looking up online forums for properties for sale, the location is the first thing you notice on an online forum as well. You might have heard some relative or friend discussing about how they could envision their dream house in a specific part of town. Location of a property is the key of a successful real estate development.
There are many perks of an ideal location of a property, whether it is the security and amenities, relative location to other areas and general view of the house. For example take a popular area like DHA and Bahria Town developments in Islamabad, these re nationally renowned housing projects that are a dream vision for a residence for the general public. If you are buying or investing a house within the vicinity of these regions, chances are your property is going to gain a lot of attention for further renting or sales. For home buyers, the opulence and luxury that projects like dha and Bahria town exude in their living experience is already going to be enough reason to invest. This shows how a general area’s popularity can count as a status symbol attracting tons of attention towards it.
The specific area of a property can also determine its security availability. No one wants to live in an area where their lives are under risk of harm. Areas with higher rates of criminal activities are looked down upon in the market. Making sure that the general area and neighborhood are safe for residents is going to go a long way for the popularity of the property.
Speaking of general neighborhood, access to amenities for residents is also a key factor for residents. Properties that are located near bigger city hubs and important commercial and recreational spots are more popular and provide better ROIs upon investment. Having closer access to amenities of life is also going to be very important when determining the success of a property. A property placed in a secluded suburb where one has to take long drives to get to grocery and other basic facilities is not a good choice for investors.
Location of a property is essentially an identity of it. False listings are a type of scam commonly committed through online forums where the scammer puts up a fake advertisement about a property in said location that actually has no physical existence. It is important to take note that you should not transfer any money or fill out your sensitive credit information on online forms before visiting the dealer and the property in person. Visiting the property in person to determine its actual existence as well as get a good glimpse of its actual surroundings is a must before proceeding with transactions.
Value of property:
The value of a property also plays a key role in determining its success as a real estate development. There are many properties out there that might look luxurious but are built in a neighborhood that devalues the living experience for people. Consider another example for a house placed in a high end area but is built on a budget with smaller dimensions than its surroundings; this house will stick out like a sore thumb and won’t be valued as much.
The basic determinants that are evaluating the value of a house include: sales comparison. This is a method that takes into account the general value of the property around which it is being sale off to different buyers and investors to roughly evaluate its actual worth. On the other hand taking into account the overall value of the land combined with the construction costs of the building is going to set a value of the property. For other properties, specifically rentals that generate passive income; taking into account the inflow of income is another way of determining a property’s value.
There are many scams to present a false value of the property. Unaware home buyers who want a new residence are easy targets for such fraudsters. The actual value of the house is exaggerated by a lot so that unaware victims of such scams will end up paying more than its actual worth. Moreover the scammers will put up quick fixes on old and worn down properties to make them appear flawless and sell for a higher price than its actual worth. Try to make sure you hire a home evaluation expert while visiting the property so that they can detect any quick fixes to cover up the property’s flaws.
Determining your intent with the property:
It is a well known fact that real estate market in Pakistan is ever expanding. As the demand increases due to rising population, the property numbers and types go up. Rental properties, plots, residential properties, commercial properties, mixed used buildings, office buildings, apartments for sale in Islamabad, Lahore, Karachi, Multan and many other cities of Pakistan are available in all shapes and sizes.
It can be a daunting choice to make to figure out what you want to invest into. This is in fact the first step one has to take to insure a successful real estate investment in the market. Without a clear intent to why you are investing in the said property, you might end up with a loss. You can buy out an apartment for sale in Islamabad or Rawalpindi with the intention of selling it off for a larger value all along over the years, but then abruptly switching the decision to transform it into a rental property might be detrimental to the profits you could have gained. This specific property might not be able to flourish as a good rental property where it stands.
Consider another case where you are unaware of property laws in a specific are and intend to invest into a property with the hopes of expanding it. Later you find out that the modifications you want to enhance the look or value of the property is not allowed by the area’s authorities. Similarly switching the commercial service after buying out the property, for example switching a meat shop to a hardware store in a specific location might be a bad idea.
That is why determining what the future of the property will be is one of the most important aspects of real estate development.
Conclusion:
Real estate investment can be a very complicated topic; especially in the current state of expanding market; however there were a few factors to consider ensuring a successful investment. In this first part of the article; we went over the location of the property, the determination of the intent which you want to invest into the property as well as evaluating the worth of the property. In the many areas that you can invest into as well as the many property types like houses, commercial properties, plots and apartments for sale in Islamabad, Lahore and Karachi and every other city of Pakistan, considering these 3 factors will make sure that your investment is not going to result in a loss.
It is important to note that we did point towards scams and frauds in the real estate industry, if you are new to the real estate industry or are just looking to buy a house, it is important to ensure the security of a property’s dealing. This article will be further continued…
