Daily InsightsLand Use and Property Rights

Vertical development and mortgage financing – A solution to Pakistan housing crisis

By 13/09/2022 0 Comments

The urban area of Pakistan will face a looming housing crisis. . The housing shortage stands at 31 per cent of the country’s total population while other countries like India, Bangladesh and Srilanka have much fewer percentages. The increasing population has been exacerbating the housing demand over the years, resulting in a housing shortage. By 2025, it is anticipated that the shortage will increase from 11.4 million to 17.2 million units 2025. To resolve this issue, vertical development and mortgage financing must be promoted in the country. In the upcoming years, such developments will significantly alter the property sector in Pakistan and make living affordable for the population.

Urban cities are becoming overpopulated as about 44 per cent of the population is expected to inhabit the urban centres by 2030. With increasing housing demand, the prices of properties either commercial or residential are rising, making it difficult for people to afford them. To bridge this gap, vertical housing is already on the rise across major urban cities in Pakistan, especially after the pandemic. The apartment trend will significantly change consumer habits and demands, providing a viable solution to a housing shortage. Moreover, the improved regulations by the government will bound the developers to deliver projects timely. Mortgage financing is still a new concept in Pakistan, but adopting this method will make it affordable for people to buy property, eventually boosting the real estate industry.

To keep the trend alive and provide a solution to the housing crisis in Pakistan, the developers need to deliver timely. The government must improve their rules and regulations to ensure that all NOCs and approvals are issued on time, and coordinated action is a prerequisite to improving the performance of the country’s real estate sector. The government and HBFC should work together to make a policy for providing low-interest rate loans to build houses. Furthermore, vertical housing must be encouraged to develop customers’ interest and fulfil the housing demand. It can be done by holding real estate events and expos, even at international levels, to bring in investment in the country. According to estimates, the dead capital in Pakistan is of Rs 300 billion. If the government devised policies to use this land efficiently will increase the revenue. The vertical development and low-interest rate mortgage have the potential to combat the housing crisis in Pakistan.

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