These days, there is hardly anytime for some relaxing songs or a lazy brunch on a Sunday morning in the relatively posh localities of the metropolis if one has advertised a portion or a flat for rent. There is certainly some sanguinity creeping into the housing market especially on this side of the bridge.
And this helps explain rising violence in Karachi and booming real estate simultaneously. The ostensible boom in the property market is one of a kind: The increased activity in the sector is definitely segmented, primarily vivid in areas like Defence Housing Authority (DHA), Clifton, PECHS and Malir Cantt.
Lately the boom in real estate in Karachi, whether property price or rental, has been underpinned by one major factor: increased violence in city. Khawar Idrees, a real estate consultant for Big Ben Estate reckons that a growing flow of buyers and prospective tenants have come to these areas due to the perceptive safe haven qualities of the same from across major volatile areas.
Talking to BR Research, Idrees emphasised on the developing trend of migration within the city which has resulted in 30 to 40 percent rise in the residential property prices in DHA, with price varying from phase to phase. Prices in volatile areas and localities up north have also notched up but rightly in tandem with inflation only, signifying a good 20 percent security premium being paid by those who relocate and shift to the recent preferred.
He also conceded that business activity in the city has hit a snag not only due to the security situation but also the overall macroeconomic environment, and as such prices of commercial plots have not taken an upward flight like that of the residential plots, bungalows and flats.
Furthermore, the rise in rentals has been even higher as people are either getting a lower value for their properties, or those who have additional income are moving to these areas on rental basis waiting for at least a fair value for their real estate.
Besides, he also pointed out the clear migration of affluent settlers of Balochistan particularly Quetta which has driven up the demand in these so-called posh areas. Ahmed Karim of Ur Property Real Estate Consultant added further to the interesting dynamics of the real estate business in the city, terming the shortage of availability a problem for the sector as well as another reason for price escalation. He conceded that people no longer have choices and they settle for the first few they are being offered. A 500 yard plot which was around Rs1.8 crores a year back has now gone up to Rs2.5 crores. Similarly, a 1,000 yard plot begins at no less than Rs4.5-5 crores depending upon the phase and location in DHA. When it comes to rentals, whether it’s a portion or an apartment, the difference has easily crossed Rs20,000-25,000 mark.
All of this makes one thing apparent: the sprawling city‘s violence is dictating the property sector. And the sector which should be robust due to investors’ rolling an economic activity is now becoming more of a refuge for only the affluent seeking security.