The number of Pakistani overseas investing in the real estate industry in Pakistan is rising by the day. According to UNCTAD’s 2020 world investment report, FDI inflows to Pakistan increased from USD 1.7 billion in 2018 to USD 2.2 billion in 2019. But why exactly are they investing in Pakistan?
Stabilization in the sector
Unlike before, Pakistan’s real estate industry is now offering transparency, credibility and integrity which boosts overseas investor confidence. Also, the Pakistani government has embarked on an active foreign investment promotion programme in which they have taken a number of economic liberalization measures to make the country more attractive.
The government has offered incentives to the construction industry to promote local and foreign investments. Some of them include:
- Anyone investing in the construction sector will not be questioned about the source of their income for the year 2020.
- Construction Sector is given the status of Industry.
- Withholding Tax on Construction Industry lifted from all sectors, except Steel and Cement.
- Any family selling their house will not have to pay for a capital gains tax.
The terms of the package, valid till December 31, 2020, has proved to be a game-changer for the real estate sector.
Also, the introduction of Roshan Digital accounts has further empowered the overseas Pakistanis. Roshan Digital accounts allow Pakistanis to invest in residential, commercial, stock exchange and other types of investment opportunities.
Technological advancement
The phenomenon of globalization is another key component of why overseas Pakistanis are investing in Pakistan. Due to social media apps and services, overseas Pakistanis are provided with the latest real estate news, project details and investment opportunities. People in Pakistan are seeking out overseas Pakistanis via different marketing techniques such as sponsored ads on Facebook, Instagram and Youtube. With all the relative information online, overseas Pakistanis are conducting their own research at the comfort of their homes.
As the world becomes more connected, development opportunities pave the way to demand beyond one’s current location. Wealthy investors may eye a certain land or property, increasing real estate demand that stems from distant geographies. What follows is a flow of foreign investment that allows faraway assets to be purchased, and this can have major impacts on local economic measures.
Digital banking
For an overseas investor, one of their biggest worries is to make payments while sitting abroad. Some would either have to travel into the country or they would ask one of their relatives to make a payment. Instead, due to digital banking, the whole process is made much easier.
Online banking has allowed overseas clients to invest at the tip of their fingers quite literally. Real estate societies have enabled online payments for overseas as well as local investors which means that payments will be received within a week. All the investors have to do is send the relevant documents in the form of PDF. Once all the documents and payments have been received, the rest is up to the real estate consultants.
Real estate consultants
Real estate consultants have played a major role in convincing overseas Pakistanis to
invest in real estate. These investors make the process of investing in real estate as
easy as possible. Once overseas investors find a trustworthy consultant, the
consultants will do all the work for them. From managing paperwork, purchasing and selling, the real estate consultants handle everything.
Let’s say that you’re a very busy person and do not have enough time to research the market. You can leave all the work up to the consultants. A good consultant knows all the creeks and nooks of the real estate market and will tell you of all the real estate trends.
Special amenities for Overseas Pakistanis
Most societies have a designated block for overseas Pakistanis. These overseas blocks are limited for overseas investors only. They offer special amenities that are available abroad to make them feel at home.
For instance, Capital Smart City is a residential and commercial society that has attracted investors from across the globe. Capital Smart City has a separate overseas block where tons of amenities are offered exclusively to overseas residents. Due to the increased demand for overseas blocks, the level of profits are relatively high and in most cases, the overseas blocks are the first to be developed.
Bottom line: Pakistan is undergoing a tough period of economic development due to political situation in the country. Nonetheless, the government is taking measures to correct the flaws of the real estate industry. This makes room for investment opportunities for overseas Pakistanis and for this reason.