In Pakistan, property prices have observed a rapid escalation due to escalating land prices and increasing the cost of construction. The cost of construction materials has followed an inflationary trend along with other commodities. However, the property prices skyrocketed due to the shortage in the availability of land. When traded in the secondary market, real estate tends to grow in value due to the speculative nature of the property market.
A lack of a holistic land administration system is the cause of a rapid increase in the property index. The property index of Pakistan shows that property prices have grown by 126%. However, the cost of construction has not observed parallel growth, which shows that land price is the leading cause for the increase in real estate prices.
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