Socio-political drivers of real estate prices

Socio-political drivers determine the pricing in Pakistan’s real estate industry, worth around $350 billion. The district collector’s (DC) property valuation rates and the State Bank of Pakistan’s interest rates remain a meagre part of the economic literature. Despite a consequent decrease in real estate prices globally, there is no sign of a decline in property prices in Pakistan. Like many other developing and developed countries, the country is also facing a wave of economic recession. The mounting inflation, low returns, stagnant growth and magnifying unemployment are a few of the worries. While housing demand is low, property prices are rising, shattering economic principles. Contrarily, supply is created to attract demand at a later stage. What is special about the realty sector? Here we have to diverge from pure economic analysis to socio-political dynamics. Pakistan’s realty economy is characterised by manipulated business practices, political interventions, social standards, cultural considerations and illogical crescendos.