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Pakistan Property Frequently Asked Questions

Money From Selling a House Land Have to Be Invested in House Land Hadith
Money from Selling a House, Land have to be Invested in House, Land – Hadith

NOTE: Frequently asked questions are listed questions and answers, all supposed to be commonly asked in some context, and pertaining to a particular topic. Kindly ignore any question or answer if it do not fit in any context. It is really hard to answer all questions for all contexts.

Do I invest in Property or Not?

Property investment is always fruit full and cannot return into loss if you have holding power. People are investing in Real Estate from centuries. In General property investment called as dead investment. Minimum investment for a residential or commercial property should not be less than 5 years. 10 years is more than enough time to get a hand some return in property investment.

Tips: Dealers / Agents / Builders / Authority (*Business) may highlight an investment for short time period for their interest or benefit.

*A business (also known as enterprise or firm) is an organization engaged in the trade of goods, services, or both to consumers. Businesses are predominant in capitalist economies, where most of them are privately owned and administered to earn profit to increase the wealth of their owners. Businesses may also be not-for-profit or state-owned. A business owned by multiple individuals may be referred to as a company, although that term also has a more precise meaning


What is file?

which is not balloted yet or has been balloted and on ground or not on ground, and possession (where construction can be started immediately) is not granted by the builder / developer / Authority

Tips: Prices of files may fluctuate sharply (up and down) as per market conditions. Files are usually booked on installment plan for 3 years cost of land and 3 years for development charges in most cases. One should be clear before investing in file that how much time is required for holding.


What is plot?

Area where physical possession (where construction can be started immediately) is granted by the builder / developer / Authority

Tips: In common after ballot dealers / agents sell or buy file with plot number and treat it as “PLOT”. But practically we have experienced that developer / builder / authority can change any full and final given plan due to any technical reasons / immoral practice or to oblige some one (specifically Govt. Officials / Army Officials, Authority Officials), in such case plot number change. I think that plot should be only consider where possession is granted and construction can be started immediately. Any investment before possession should be treated as “FILE”

Physical possession (Plots) are more stable in different conditions of market as compare to files or Plot files which shows more fluctuation in different market conditions (up and down). Plots files are called which balloted and plot numbers are allotted but still possession is not granted by Builder / Developer / Authority for living.


What is a Society?

Answer: A Society can be defined an area having Urban planning with following amenities / facilities for residential cum commercial purpose:

Basic Amenities / Facilities:

  • Electricity
  • Water
  • Gas
  • Sewerage
  • Road Network
  • Commercial Area

Advanced Amenities / Facilities:

  • Parks
  • Play Area
  • Hospital
  • School
  • Any other features like Golf Course, Club, Gated Area, In House Security etc.

There are Three Types of Society Developments in Lahore:

  1. Developed / Operated by Authority (Lahore Development Authority (LDA) Faisal Town Lahore, Garden Town Lahore, LDA Avenue 1 Lahore, Johar Town Lahore, Allama Iqbal Town Lahore etc.) or Defence Housing Authority (DHA)
  2. Developed / Operated by Cooperative Body (Wapda Town Lahore, NFC Lahore, Model Town Lahore etc.)
  3. Developed / Operated by Private Company (Bahria Town Projects, Unban Developers Projects, Izhar Monnoo Developers Projects etc.)

Tips: Lahore Development Authority (LDA) is prime developer and true Master Planner of Lahore. The Lahore Development Authority was created under the LDA Act 1975 duly approved by Punjab Legislative Assembly. Previously it was Lahore Improvement Trust (LIT).

Defence Housing Authority (DHA) is a parallel authority in Lahore in cantonment area and delivered A class housing and commercial projects with state of the art developments and facilities.

Cooperative Bodies like Wapda Town, NFC Lahore, UET and many other also contributed best living standard for Ordinary Man at low cost.

Private Builders / Urban Planners like Bahria Town, Urban Developers Eden Builders and many other also delivered state of the art developments and facilities in Lahore.


How to verify a Society?

After selection of desired area of City where you want to live or invest, next step is “How to verify a Society”

Before investing / buying plot / home / commercial in any society you to have to consider followings:

  • Is Housing Society is registered with Securities & Exchange Commission of Pakistan (SECP) or Cooperative Department?
  • Is Society land transferred on Society name in Revenue Record?
  • Is Housing Society has valid NOC from Local Development Authorities (LDA / CDA / GDA / MDA / FDA as per approved map?
  • Is Housing Society has made arrangements for development work like Water, Gas, Electricity & Sewerage etc. on site?

Tips: Pre Launch bookings are highly not recommended. You must wait for official launch of booking by publicly advertised in major news paper (s) with confirm location, booking schedule, installment time frame and tentative time for possession (year of possession).

Before investing in any project you must keep eye on News Paper warnings ads by Local Authorities against projects which are not approved. Usually these local Authorities has a list of approved Housing Societies, as well as Unapproved Housing Schemes lists. You may also visit Local Authority Office and can verify about the scheme before investing.

A marketing company / affiliates / agents may highlight a project which they are dealing with for their interest.


What is a Balloting?

The term balloting was generally used for assigning plot numbers to the allottee for a said project in Pakistan Real Estate. In General Ballot mean “decide the allocation of (something) to applicants by drawing lots”. There are two types of Ballot in Pakistan Real Estate Market in General now:

  • Booking Ballot
    • Booking ballot mean, when a project is being offered on installment plan and people apply for the booking and ballot held for successful and unsuccessful applicants, called Booking Ballot
  • Plot Ballot
    • Plot Number Ballot mean a draw in which numbers allocated to each allottee against its file, in other word Map issued with plot numbers.

Tips: Now a day people are often trapped in the name of ballot by Agents / Developer / Builder / Authority. It is recommended to ask Agents / Developer / Builder / Authority before booking any project that it will be a confirm booking or there will be booking ballot, also when Plot Ballot will be held?


Which location is best?

Usually in market Facing Park, Main Boulevard or Boulevard, Corner & locations near amenities are called as good locations, but in fact good location is whatever you can buy in your budget.


What is short term & long term investment?

People often ask “Is it a long term investment or short term investment’? In general mostly people perceive that an investment which will give return in short time called as short term investment, and an investment which will give return in long term will be a long term investment. Where as there is no relation of gain for an investment to be called as short or long term.

An investment time frame can be define from its delivery period rather its gain. A project is going to be deliver in next 1 or 2 years can be treated as Short Term investment, where as a project going to be deliver in next 2 years or more will a mid term or long term investment respectively as per time frame.

Prices for any investment can be rise due to several reasons, so primary criteria to measure an investment time frame should be only its delivery. Next important factor is the pace of occupancy, we must analyze that if a project is located at long distance and being delivered by the  developer / builder / authority in short time or mid time but how long it will take to occupy. This is also a very important factor to understand an investment. If pace of occupancy will be fast price will rise with consistent growth, if occupancy rate will slow then prices may come down or remain stable. It will vary from project to project and situation to situation.

Tips: Always ask your agent the delivery time of the project, or contact Builder / Developer / Authority for delivery time of a project.


Difference between Allocation & Affidavit Files?

Affidavit files are agreement between land holder and DHA. When land holder surrender his land in favor of DHA, DHA issue affidavit files in his favor. Usually this proportion is 2 files of 1 Kanal against 1 Acre of land. DHA give a favor to land holder that in affidavit file Seller name is written and Purchaser name is open. In other word you can say it is a open file. Land holder has this opportunity that he can fill the name in Buyer filed and submit it to DHA and attach a transfer fee voucher (paid by buyer) and DHA transfer this to buyer name. Now this affidavit file is submitted back to DHA. For Buyer DHA issue an intimation letter to intimate him that file has been transfer in your name. Now Buyer need to become the Member of DHA. Buyer submit the membership fee to DHA and DHA issue an allocation letter to buyer after due course of time.

Now it become an allocation letter. Now it will be transfer as like plot transfer, NDC will be applied, all Govt. taxed like Stamp Duty, CVT, Advance Tax on Sale and Advance Tax on Purchase & DHA Transfer fee etc. will be applicable. Once it become the allocation all the transfer charges will be applicable on every next transfer. So you can say usually files are first affidavits and then become allocations. However in case of direct allotment like booking or to Army Personal it is directly an allocation file and all transfer fee and charges are applicable on first transfer even, because it is a direct allocation.

  1. Affidavit file transfer fee vary between 6500 to 20000 for normal to urgent transfer respectively.  Purchase is not charges any CVT, Stamp Duty and Advance Tax. Affidavit file can be transfer without presence of Seller and Buyer in DHA Office. But for allocation letter collection Buyer must present himself to collect allocation letter.
  2. Allocation file transfer fee is charged as regular plot including full DHA Transfer Fee, Advance Tax on Purchase, Capital Value Tax (CVT), Stamp Duty and any other Govt. charges. For Allocation files Seller and Buyer must be present in DHA Office, except Overseas Buyer Transfer or On Behalf of Buyer Transfer in case of DHA Bahawalpur. But for allocation letter collection Buyer must present himself to collect allocation letter.
  3. Affidavit files rate is more then Allocation files due to difference of transfer fee.
  4. Affidavit files can be transfer within 3 to 4 days, where as allocations files required NDC and take 7 to 10 days to transfer.

Affidavit is like an advantage for land holder who surrender his land for DHA project. Affidavit and Allocations both files are issued by DHA and are equally secure as the issuing authority is Defence Housing Authority


When Ballot / Development / Possession will be held / started / completed / given?

Most common question after booking of plot / home / commercial by investors in any relevant society by Agents / Dealers. Usually to satisfy their clients, Agents / Dealers answer this question as per best of their knowledge (knowledge is always limited up to any extent). Agents / Dealers communicate with relevant society Front End Management Officials or Customer Relationship Officers (CRO) which usually are not aware of ballot date / development schedule / development status and development completion timings. In result investors get dissatisfied due to mismatch of information or bogus information.

Tips: Always contact Builder / Developer / Authority directly to get right answer for such queries like Ballot Date / Development Status, Completion of Development etc. Only Builder / Developer / Authority can have best answer for this question, only they can give exact or estimated date for ballot / development started and completion / possession etc.


How much holding time is required for an investment?

Commonly asked question by investors from Local as well Overseas. Although there is no set standard to define the time frame of property investment. Its vary from Project to Project and stage of Project. However generally we should have following time frame in mind for property investment after buying / of plot / home / commercial to get some return.

  • Minimum: 1 year
  • Reasonable: 3 years
  • Sufficient: 5 years
  • Enough: 10 years
  • More then enough: 15 years

15 years is more then enough to hold a property to get the maximum return at a specific growth rate. Mature projects has slow but stable and secure growth, where as under developed or newly developed projects has faster growth rate but more risky if market drop.

Tips: Before doing any investment you must be clear about your holding time. Do not make any investment with un clear holding time. In property the holder is the winner. If you have holding capacity you are in a win win position. Consult with your agent about your holding time. Do not invest in property if you cannot hold for minimum 1 year time period or other wise you must have to be in touch with daily market trends. If you have enough time to do so then think about less then 1 year investment other wise leave that option. If you are booking a plot or home you must be able to hold it till possession, pre possession sale may return into loss. If you cannot pay the installment please do not book.


Which investment is better Residential or Commercial?

Definite commercial investment has more return in terms or value as well as rental income as compare to residential investment. Residential investments are for personal living or individual and commercial investments are for Business or Earnings.

Tips: Before making investment decision for Residential or Commercial first decide following things:

  • Are you going to use this investment for both purpose (residential cum commercial)
  • Population size of the area specifically for commercial investment
  • Amenities / facilities available in the society for residential purpose

Which investment is better Cash Payment or Instalment Package?

Again I do not have a one line answer for this question. No one else can give answer for this question, only individual can answer him / herself about this question keeping in view the following factors:

  • Is your decision is for pure investment purpose to get some return
  • Are you going to use this property for your own residence or business purpose
  • When you need to construct home or building (after how many years)
  • Can you easily pay installments in time when due
  • Are you ready to wait until project get developed and possession granted

Tips: Do not book plot or home if you are not able to mature it or cannot wait till possession granted. Investment may be risky and return into loss for pre mature selling (builder or agents / dealers are in “win win” position in this case, only looser can be the investor).


Do I contact more than one agent / dealer for selling / buying decision (s)?

Yes, you should not rely on single source of information. At least you should consult more than 5 agents or dealers before making any final decision for selling or buying properties.

Tips: You can use various online portals to find out agents or dealers in Lahore in different areas or societies. It’s better to contact the agents or dealers having offices in the relevant area or society. Dealers or agents sitting outside your desired area or society may have less information or non-competitive rates as compare to dealers or agents sitting in the same area.


What are commission charges of agents / dealers for a sell, buy or rent deal?

In common it was 2% from both side (seller and buyer) but due to intensive competition in market agents / dealers accept 1% or as per mutual understanding / agreement between agents / dealers and seller / buyers. In Rent case it is half amount of the one month rent as per agreement or mutual understanding / agreement between agents / dealers and Tenant / Landlord.


What is the price for a plot or home (any specified area like: 5 Marla or 10 Marla) in Lahore?

Lahore is too big, it is really hard to answer this question in some words or some line. E.g. 5 Marla plot available in Lahore from 2 lacs to 70 to 80 lacs in Lahore for residential purpose. Dealers or Agents will only highlight the area / society which they are dealing with or where they can have more benefit or interest.

Tips: Before going in market for research first decide your preferable area or society then do market research for rates.


Where to invest in Lahore (or their relevant city), which society is best for investment or living?

Most common question asked by local as well as Overseas Pakistanis and very difficult to answer without knowing some basic information. In General every area of Lahore is best for living and investment for someone preferences. People are living in every corner or Lahore. Dealers or Agents will only highlight the area / society which they are dealing with or where they can have more benefit or interest.

Tips: Only individual (buyer) can decide the best suitable area for living in Lahore for him / her self keeping in mind his / her budget, location priority, children education, earning / business location, other family members location or any specific priority (only can be define by an individual him / herself).


Questions & Answers by Mufti at Darul Uloom at Karachi

  • Can I sell my flat which is booked by giving some down payment, where as possession is not taken and no construction started at site?
  • Can I sell any Property for which I have done Biana, but has not transferred on my name nor I have taken possession of the property?
  • Can I sell any under developed society plot, which is booked by me and have made some payment also, where plot number is not allotted?

Please Download following Fatwa for the answers of above aksed questons

Property Fatwa about Sale Purchase of Installment Plots Homes Flats

Mufti Tariq Masood explaninig the Selling & Buying of booking forms:

209 thoughts on “Pakistan Property Frequently Asked Questions

    1. Dear Sir,

      DownTown will be a better choice as compare to Ramada in terms of location. Due to its prime location we are expecting more rental yeiled for DownTown. Also DownTown is fully furnished by Wingchair.

      1. Yes but didn’t it said that ramada is give 10% rent yeild but downtown is only 7% guaranteed yeild?

        1. Dear Zubair Bhai,

          Is Ramada offering net 7%? Also in DownTown you are not bound to give them for rent, you are allowed to rent yourself and get a better yield. There is no binding. Ramada is not fully furnished, DownTown is fully furnished by Wingchair. Also DownTown location is very prime and can use for offices cum residence.

  1. Aslam o Alikum
    I want to buy a file of Al kabir town in lahore near raiwind road.
    Plz guied me because this is my 1st time

  2. I heard the dha multan 1 kanal files that are selling for less than 50 lakh now will be worth more than 1-1.5 crore in around only 2 years time after possession and people start living etc. Is that true? If yes, it means it will be a better buy than dha guj right now?

    1. Dear Umair Bhai,

      Its look hard to reach upto 1 or 1.5 cror in next 2 years but definite with the passage of time it price will go up. I will suggest DHA Gujranwala over Multan.

      1. Dear Atif Bhai,
        I am looking for 1 kanal boulevard/ main boulevard or corner plot (ideally with extra land) in DHA bahawalpur, if you got some option please let me know.

  3. Due to recent gov policies im predicting plot trading to be very down. So im thinking to invest in any apartments or the like. Whats the best developing project or apartments project to invest in now? Jazakallah.

    1. Dear Rashid Bhai,

      Its your own choice, you may get capital gain on small investments like, DHA Quetta, DHA Multan, DHA Gujranwala & DHA Bahawalpur etc. Or for monthly rental income you can go for apartment.

        1. Dear Sohail Bhai,

          After ballot DHA Multan development charges will be started, further investment will be required. However Multan will be also good for next 3 years holding time.

      1. What do you mean by upper cutting of block J? Is it on the side next to the graveyard or opposite side?

        1. Dear Sir,

          If you look at J block it has 3 portions in vertical direction, I am talking about the upper cutting portion which is near to interchange.

  4. Aoa pls update me about declaration of property especially for plot on instalments ( file ) ? Tax will b on actual total cost for a file or the amount we have paid to society like a gulberg etc
    Regards

  5. Hello Sir, There are plots in DHA multan 5 marla on Cash , they say NOC is ready, what is that means. Can you explain.

      1. So what is the difference between the one on Installment or the one on Cash. After balloting both will be same status and what is the own of 5 marla Installment and is this the right time to purchase or after balloting it is better to purchase.

        1. Dear Wasim Bhai,

          No difference at all, other then the payment plan. If you want to try luck for location then you can buy now, it you want to buy a confirm good location plot for next 3 to 5 years holding then buy after ballot even you have to pay premium to buy a good location.

  6. Dear sir please advise for investment purposes in Lahore with a budget of 50-55 lakhs. What’s the best place to put that money?

  7. Please If you have money spend it on a bussiness and creat jobs for people. Don´t make it impossible to live in pakistan by buying and keeping the land unused. it is called zajeera andoozy.

  8. Dear brother What do you think about investment in plots in Gwadar? There is a new project Green Palms the plots are very good price. You think it is a good investment or too risky?

    1. Dear Jutt Bhai,

      Project is located at Main Coastal Highway, and approx 27 KM away from New Town Monument which is called city center now a day. Development work at site is going on, this may take some years to be occupied. For long term holding it will be a good project.

  9. Dear Atif bhai,
    I have a plot in LDA Avenue block C. It’s 1 kanal and it’s value is still the same since I purchased it! I bought it many years ago but there’s still some issue I don’t understand and it’s not increasing At all. Do you think I should sell it or will it increase in future? Because last 10 years it’s not increasing which is very surprising to me.
    Thank you.

    1. Dear Haris Bhai,

      I am not sure about location of your project, but in fact prices has grown in LDA Avenue 1. May be you bought at peak time, and then market came down. Can you please tell me what offer you are getting today for your plot?

      1. Atif bhai,
        It’s plot number 523A and it’s one kanal. I’m only getting an offer of around 70 when i bought it for almost the same price 10 years ago! How’s this possible? Thank you.

        1. Dear Haris Bhai,

          I am not directly dealing with LDA Avenue 1, that’s why not updated with the rate history. But I remember from 2013 to 2014 price was high for 1 Kanal plot in LDA Avenue 1. However if you are interested to sell it, kindly send message to our whatsapp hotline at https://wa.me/923111042111

      2. I am slightly concerned for other people reading this forum’s sake. I dont understand how you can recommend Lda city to everyone when Lda avenue turned out to be a terrible investment for anyone unlucky to invest there like me many years ago! You tell me atif bhai had I invested this much money (70 lakh more than 10 years ago was worth so much even more than now) for a 1 kanal plot anywhere else in the whole world not just lahore i would have been very happy by now. Only Lda avenue is worthless so I hope all these people you are recommending investing in Lda city don’t end up very disappointed like me.

        1. Dear Haris Bhai,

          Everyone has different experience with property. Person investing today in LDA Avenue is happy to invest due to possession area. LDA is the actual master planner of Lahore and has various successful project in timeline. Yes there were / are some issues with LDA. But now LDA has improved a lot. LDA City Investment is recommend for next 3 to 5 years holding time.

  10. Dear Atif Bhai,

    I’m looking to buy a plot/file in Lahore around 5/M – 10/M within a budget of 2.5 Million for a investment or property purpose. I can hold this investment atleast 5 years.

    Please suggests me best options to invest in Lahore. My interest goes towards LDA city but bit confused.

    Jazak Allah.

    Regards,
    Faysal

  11. Salam aleikum.
    I was asked by an agent whether for to buy a 10 marla plot file using the affidavit or allocation. By my understanding i think allocation seems safer as it involves me physically being there to see what’s going on. What do you recommend I should do and is there any major difference?

    1. Dear Sultan Bhai,

      Yes allocation is safer. Although affidavit is also safe but if you agent cheat with you then you may be in trouble while buying affidavit file. However if you are buying affidavit through a registered agent then you are in safe hands.

  12. Hello sir What do you think about DHA phase 9 in Lahore? Is it good for investment? Because it took 13 years for balloting but now all the issues are settled. Is it a good time to buy it or will there be further issues in future?

  13. Hello sir what do you think about state life phase 2 in Lahore? I have a plot there it’s value is not increasing since last 1 or 2 years. Do you think it will increase in coming years or I sell it now?

    1. Dear Rauf Bhai,

      Although it took a lot of time and still not clear when it will be available for house construction, so far no development at all.

      In my opinion seller should hold it.

  14. Sir what do you think about DHA phase 9 in Lahore? They took 13 years for balloting but now all the issues are settled. Do you think it’s good time to buy a plot there for investment or will there be further issues in future? Thank you.

  15. Hello sir just wanted your opinion on whether to buy a 10 marla plot file in DHA bhawlpur or DHA gujrawala? Which one according to you will offer better returns in the long term? Also is now a good time to buy them or do you think the price will decrease further in the coming months?
    Thank you so much for your time.

    1. Dear Zahid Bhai,

      LDA City is under developed project and this is long term investment. You may invest in LDA City considering 3 to 5 years holding time.

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