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Impact of inflation on real estate in Pakistan!

Impact of inflation on real estate in Pakistan! 1200 628 D. I. Khan New City

Inflation has a huge impact on real estate in Pakistan. Land prices, homes, apartments, and other real estate types have been rising steadily for the past few years. This directly affects the affordability of real estate for ordinary citizens. As inflation increases, the cost of living also rises, making it difficult for people to afford to buy property. In addition, the increasing prices of real estate also affect the construction industry, as materials become more expensive and wages remain stagnant.

The current economic situation in Pakistan has created an environment where many people are unable to purchase property, and this has caused an overall slowdown in the real estate sector. This article will explore the impact of inflation on real estate in Pakistan and what can be done to ensure that the sector remains healthy and vibrant.

 

Impact of Inflation on Real Estate Prices

Inflation is a term that is often used interchangeably with rising prices, but there is a lot more to it than that. Inflation is a general increase in the prices of goods and services in an economy over a certain period of time. This is caused by a combination of factors, such as supply and demand, monetary policy, and government spending. Rising prices are a natural consequence of inflation and can be detrimental to real estate prices in various ways. While demand for property is high, real estate becomes a lucrative investment option. However, rising prices cause the affordability of real estate to decrease, thereby decreasing demand and putting downward pressure on prices.

Real estate investors need to be aware of the current trends in the market and understand which way prices are likely to move. Inflation can have a huge impact on the value of the real estate, but it is also important to take into account other factors that can also affect prices. For example, a sudden increase in the supply of a particular type of property can cause prices to drop, even if the economy is experiencing high levels of inflation.

 

Effects of Inflation on the Construction Industry

Real estate is one of the highest-risk industries in the world. The majority of projects are delivered late and often over budget. This is due to a variety of factors, but one of the main causes is an increase in project-related costs. Construction companies are forced to pay more for materials and workers, which in turn means higher project costs for the buyer.

This can have a detrimental effect on the delivery time and cost of future projects that are currently in the pipeline. If these projects are unable to secure financing, they will be delayed or even canceled. This can create a ripple effect that damages the whole industry and has a knock on effect on the whole economy. Inflation can also affect housing and commercial property developers, as well as investors, who have to spend more on labor and materials.

 

Impact of Inflation on Affordability of Real Estate

The inflation rate is a key indicator of how much the cost of living is rising. If the inflation rate is high, the cost of living is also high, and people’s purchasing power will fall, making it difficult to sustain living standards. This can have a huge impact on the affordability of real estate. As the cost of living increases, people have less disposable income to spend on things like buying property. This can cause demand for property to fall, and real estate developers may find it difficult to sell their products.

Inflation can also affect the affordability of interest-only mortgages. If the inflation rate is high, the interest rate may also be high. This means that people will have to pay higher monthly payments, which may become unaffordable for many. This is particularly problematic for people who are taking out a mortgage for the first time and are not earning enough to make larger monthly payments. If people cannot afford their monthly payments, then it can lead to a rise in defaults and foreclosures.

 

Impact of Inflation on Property Demand

As the cost of living increases, people have less disposable income to spend on things like buying property. Real estate developers can depend on government policy to affect the demand for property. If the government imposes restrictions on buying or selling property, it can impact the demand. For example, if the government imposes a capital gains tax on the sale of real estate, fewer people will want to sell their property, and demand will drop.

The government can also regulate the supply of land, which has an impact on the demand for properties. For example, if the government places restrictions on developing land, demand will decrease, as there will be fewer properties available. Additionally, the government uses monetary policy to manage the supply of money in the economy. This can affect the demand for property, as people have less money to spend.

 

Measures to Control Inflation and Boost Real Estate Sector

When inflation is high and rising, the government may take action to combat this and control the situation. There are a number of ways in which the government can control inflation in the economy, including Increasing interest rates – this causes the exchange rate of the currency to rise and makes imports more expensive.

This reduces the demand for imports and can help the economy in the long run, although it can have a short-term impact on the economy, as it can make exports less competitive. Introducing tax increases – this can be done on a number of different items, including property. Increasing taxes can help the government to recoup revenue and reduce the deficit. Introducing government spending cuts – this is a short-term measure that can help to reduce the deficit and stabilize the economy. It can take some time before it has an impact, however.

 

How to get the maximum return for your investment in this inflation?

Investing in this inflation can be tricky, but it can also be very rewarding. To get the maximum return on your investment, you need to be smart and strategic. First, it’s important to research the market. You should look at the current trends in Pakistan’s stock market, as well as any upcoming developments that could affect your investments. You should also research different investments and understand the risks and rewards associated with each one. Once you’ve done your research, you can start investing. It’s best to diversify your portfolio so you don’t put all your eggs in one basket. Additionally, you should try to invest in high return investments, such as stocks, bonds, and commodities. Finally, you should monitor your investments regularly and make adjustments as needed. By following these steps, you’ll be able to maximize your return on investment and enjoy the rewards of your hard work.

 

Final Words:

The real estate sector is the one sector where nothing can be predicted exactly. Inflation, political situation and some other factors play a huge role in it. Thus it is very difficult to forecast about the market about to unfold. All we can do is to give some estimate on it by any means.

JK Marketing organized an open house for D. I. Khan New City

JK Marketing organized an open house for D.I. Khan New City

JK Marketing organized an open house for D.I. Khan New City 2048 1072 D. I. Khan New City

JK Marketing, Pakistan’s leading premium marketing company, organized an open house for D. I. Khan New City, inviting Jehangir Saifullah Khan, Chairman D. I. Khan New City, as Chief Guest. The open house featured an elaborate information session to bring current and potential customers up to speed with the latest developments, and all the opportunities and amenities D. I. Khan New City has to offer.

The Engine of Growth for Dera Ismail Khan

The Engine of Growth for Dera Ismail Khan 408 297 D. I. Khan New City
CPEC western route & Kallur Kot bridge – Game changers for D.I. Khan
Dera Ismail khan economic corridor

For any country construction of economic corridors is of immense importance to improve the trade and economic connectivity of a region. The signing of China-Pakistan Economic Corridor (CPEC) agreement is one such investment which is crucial for economic and geographical integration for Pakistan as well as China.

Due to its social, economic, and political impact, CPEC western route will benefit Dera Ismail khan and other locations along the way. Dera Ismail khan is a city with great economic and business development potential. Another edge for Dera Ismail khan is the Kallur Kot bridge which will connect Punjab and Khyber Pakhtunkhwa. This connection between the two provinces will prove to be beneficial for both provinces. A recent report by Business Recorder attributes Dera Ismail Khan as Paharpur -D.I. Khan Economic Corridor due to the developments taking place in the region.

CPEC western route

The road construction of CPEC will be carried out based on three routes – center, eastern, and western. The Western route among these routes is considered economically and politically viable compared to the Central and Easter routes. CPEC western route has several economic benefits including growth in employment, economic output, and household welfare. The route will pass from Gwadar, Turbat, Panjgur, Khuzdar, Kalat, Quetta, Zhob, Dera Ismail Khan, Bannu, Kohat, Peshawar, Hasanabdal, and onwards and will mostly cover the least developed areas of Pakistan such as Balochistan and Khyber Pakhtunkhwa. China will also benefit from CPEC due to reduced distance resulting in lesser time for shipment.

cpec western route di khan new city
kallur kot bridge di khan new city
Kallur Kot bridge

The construction of Kallur Kot bridge between Sargodha and Dera Ismail Khan will significantly reduce the distance between Punjab and Khyber Pakhtunkhwa. This improvement in connecting the two regions will lead to an economic uplift mainly through agricultural products of the entire region. Travelling time between Sargodha and Dera Ismail khan will be reduced by 2 hours. Kallur Kot bridge will not reduce the distance between Kallur Kot area and Dera Ismail Khan from 80 kilometeres to just 15 kilometers. but also provide. The bridge will also be connected with Dera Ismail Khan-Islamabad motorway.

A public sector university has also been established in Kallur Kot which is a huge development for the people in the surroundings. The establishment of a 132 KV grid station is in process at Kallur Kot, which will improve and enhance overall power system efficiency, reliability, and power supply position in the vicinity of D.I. Khan.

CPEC and Kallur Kot— game changers for Dera Ismail Khan

Owing to the developments being made in the Dera Ismail Khan region, D.I. Khan is ready to become an active focal point for regional trade flows.  The completion of CPEC and the Kallur Kot  Bridge shall prove to be highly impactful for the overall economic and financial prosperity of Dera Ismail Khan New City.

CPEC western route will prove to be the harbinger of economic prosperity in the region. This 3000 KM sea-and land-based corridor shall reap myriad of benefits for both China and Pakistan.  Great economic incentives and increased regional consolidation shall be possible through the building of networks, which will result in increased connectivity and provide opportunities for partnerships. The network, stretching from the Silk route shall cover countries like Egypt and the Middle East, European countries, and a few critical areas of Eurasia. The Karakoram highway, which has symbolic and strategic value for Pakistan, shall make the uplift of the underdeveloped areas of Balochistan and Khyber Pakhtunkhwa possible.

Mobilization of these networks, such as the Kallur Kot bridge shall bring about economic boon through enhanced regional connectivity, dynamic investment opportunities, financial, agricultural industrial cooperation, socio-economic development, tourism expansion, educational linkages, human resource development, immense job opportunities, improved security, and poverty alleviation. Since Dera Ismail Khan New City lies in the trajectory of this multi-billion-dollar project, it is all set to become the upcoming economic hub of the region!

Having detailed what game-changers both the CPEC and the Kallur Kot bridge shall be for DI Khan, the Saif Group of Companies is actively contributing to the progress of the region through its latest project called “D.I Khan New City”.

D. I. Khan New City office

Established in the 1920’s by Khan Faizullah Khan, a man with a vision to improve the lives of the people, Saif Group has been delivering successful ventures across the country for years. Driven by the passion to innovate and excel, the mission of the founder has been materialized by the many successful ventures of the company such as Eighteen, Mobilink, Transworld, Kulsoom International Hospital and Saif Energy to name a few.

Having pioneered sound partnerships and the highest professional standards through generations, the company is now set to reach new heights with DI Khan New City. This new state-of-the-art real estate project aims to make dreams of luxury living a reality. Equipped with modern facilities and backed by a long-standing legacy of Saif Group’s success, D.I Khan New City is bound to become the ideal and highly sought-after residential area of the city.

information session open house in di khan new city

An Information Session/ Open house

An Information Session/ Open house 1024 768 D. I. Khan New City
Team D. I. Khan New City was thrilled to host an information session/open house for our valued customers and guests to give them updates on the progress, development works and future plans of D. I. Khan New City.
Our guests took keen interest in the D. I. Khan New City project and the fantastic investment opportunity it offers.
We thank our valued guests for joining us and showing their continued support, satisfaction and trust in this unique project.
Here are some highlights from the event.
For details call us at +92 303 222 4345 or visit our website D. I. Khan new City for Details.