In the real estate market, investing in vacant land is considered a more lucrative investment as compared to investing in fully developed residential or commercial property. This is due to resales of vacant plots being comparatively easier. Considering such an expenditure, specifically for first-time investors, might be intimidating. When it comes to the market value of vacant plots, there are several factors to consider. Investors should think about all of these factors first and then make the investment.
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FACTORS THAT AFFECT THE MARKET VALUE OF PLOTS IN PAKISTAN
1) LOCATION AND ENVIRONMENT
Location plays an important part in establishing the market value of vacant land in Pakistan, location is crucial. Purchasing a piece of land in a remote area of a city will certainly be less expensive as compared to purchasing a home in or close to the city.
The environment where the plot is located is also another factor that affects the plot’s market value. Investors or buyers interested in purchasing residential plots often prefer a peaceful environment. Whereas investors interesting in commercial properties seek an area that is in the midst of the city, typically a commercially active area.
2) PROPERTY FEATURES
Be it residential plots or commercial plots, each plot has a unique set of features that increase its value in the real estate market. For example, corner residential plots in the city of Karachi will fetch a higher price due to the city serving as a mega port.
Similarly, each Pakistani city has its own set of standards for determining the worth of a particular property. In Islamabad, residential plot prices are higher as compared to plot prices in Rawalpindi due to the city being Pakistan’s capital.
3) NEIGHBOURHOOD AMENITIES AND SECURITY
Most buyers prefer investing in a housing scheme that offers proper neighborhood services and a secure environment. Properties in close proximity to schools, markets, hospitals, and parks are comparatively more expensive in Pakistan.
People choose to live near educational establishments to escape long commutes. The same can be said for healthcare institutions. Having decent healthcare facilities nearby increases the market value of plots. If a residential property is situated at a prime location in the city, the presence of surrounding commercial and entertainment centers causes the plot’s market value to increase.
Another factor that adds to the market value of real estate property is security. One of the main reasons why most individuals prefer to invest in housing developments like DHA or Bahria Town is that these communities provide a secure atmosphere that is accompanied by CCTV cameras and security staff.
4) TRANSPORTATION AND INFRASTRUCTURE
Easy access to transport is another factor that affects the market value of plots in the country.
According to the country’s current real estate trends, the market value of the property immediately increases if it is next to a major highway, allowing residents to easily use public transportation.
Meanwhile, in Pakistan, infrastructure-based growth has a significant influence on land pricing. The Ring Road project in Lahore, for example, has greatly increased the market value of real estate in the nearby suburbs. Signal-free routes, such as Ring Road Lahore, enable efficient transportation connections, increasing the convenience of residents in surrounding areas.
5) DEMAND AND SUPPLY
When a city’s population grows, so does the demand for land. This typically leads to an increase in the real estate market rates of that city. Residential plots in housing schemes situated inside city limits profit the most from this surge in demand for homes since they provide privacy and protection.
However, in comparison to earlier years, this change in demand and supply is occurring more frequently these days. This resulted in several new real estate projects both inside and outside of Pakistan’s various urban cities.
If all of these factors are studied and researched properly, investors can make good money in the real estate market. However, if these factors are not thoroughly researched before making an investment, the risk of loss increases significantly.
Muhammad Junaid is a CEO of VM Solutions, senior Analyst, and Search Engine Expert. Extensive experience being an IT Manager in NextGen Marketing – Park View City. Work for years with local and international enterprises. Also, represent well-known brands in the UAE.