Islamabad the inflated

Published Oct 09, 2012 11:38am

-File Photo

Given the prevailing conditions of Islamabad’s real estate market, it isn’t too far fetched to assume that property prices in the small-town capital may one day be comparable with much larger metropoleis. The day may come when Margalla Hills in Islamabad, could be at par with Beverly Hills in West Los Angeles in terms of rocketing real estate prices.

Where the city’s real estate lacks in sleek urbanity and cosmopolitan offerings, it makes up for in offering ‘dual-purpose’ residential properties to businesses and international agencies: namely, regular houses illogically serving as offices, restaurants, retail outlets and schools.

Foreign missions, in particular, appear to eschew designated commercial sectors like the Blue Area and diplomatic/embassy enclaves for properties in specific residential zones. They pay exorbitant rental fees that also end up inflating real estate prices in adjoining areas.

Rows of discreet bungalows with corporate interiors in tree-lined streets are all too common in Islamabad. To a passerby, it’s hard to tell whether a house is somebody’s home or an office containing dozens of cubicles.

In retrospect, one can purchase a stylish home in the DHA areas of Lahore and Karachi somewhere in the region of 2 crores per kanal. In Islamabad, however, figures for just the land at the hub of Margalla Road start at 4 to 5 crores per kanal. A 4-kanal home would set you back a whopping $2 million and this doesn’t even include the construction cost.

The question arises, is it really worth it?

Property owners certainly seem to think so. Outdated townhouses are commonly rented in the region of $4,000 to $6,000/month in the F6 and F7 area, going up to $12,000/month for larger houses. The reason these figures are being mentioned here in dollars is because Islamabad landlords don’t feel inclined to conduct business in the national currency.

There are even cases where homes go unoccupied for a year or more while the landlord is determined to sign a gora face to the lease, refusing everyone else. Although properties in Pakistan always face the looming threat of qabza style squatters, this form of ‘real estate racism’ nevertheless seems extreme.

Local residents of multimillion-dollar properties in prime locations, who have managed to retain their homes over the last few decades, are now a minority. Many locals have moved to other sectors or to the city’s expanding outskirts to make room for commercial ventures taking over prime residential areas that they can no longer afford to call home. In the meantime, all too many commercial and development ventures continue to operate out of houses in residential areas.

Change is coming soon to Islamabad’s real estate market, however.  The US Embassy is reportedly building a massive structure within its premises to accommodate the housing needs of its entire staff, who would potentially move in from other residential areas in the city. According to the grapevine , once completed, it’d be the biggest embassy in the world.

But for people earning in PKR looking to get maximum bang for their buck, the federal capital isn’t the ideal choice. The same budget can ironically buy a more comfortable, even opulent, lifestyle in the country’s financial capital — Karachi, or in its cultural capital — Lahore. Even hiring household staff, a necessity for comparatively privileged Pakistanis, seems pricier in Islamabad.

The city’s domestic workers reportedly command significantly higher salaries than their contemporaries in Karachi and Lahore, and express a strong preference for foreign employers. The retail sector, too, has its confines; higher priced consumer goods from the fashion high street to kitchen appliances render shopping a trial for price-conscious consumers. After all, premium and imported commodities don’t come cheap.

When it comes down to it, it depends on how much people are willing to invest for a view of the skyline, made all the more dramatic by the iconic Faisal Mosque, the tri-towered Centaurus and the soon-to-be gargantuan Embassy of the United States

In the meantime, ‘Islamabad the Inflated’ seems more apt than ‘Islamabad the Beautiful.’

 


The author is the editorial director of the Rockville Media Company in Islamabad. She corresponds for HELLO! India, TheGenteel.com. Feedback is welcome at laaleen@gmail.com

 


The views expressed by this blogger and in the following reader comments do not necessarily reflect the views and policies of the Dawn Media Group.


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Comments (23) (Closed)


arpan
Oct 09, 2012 12:06pm
Would love to visit Islamabad despite all this. I have a hunch all the problems you mentioned are temporary. The way I imagine Islamabad is a lush green city with clean roads and cleaner air. Would certainly like to visit that mosque if non-Muslims are allowed in.
Sam
Oct 09, 2012 10:40pm
I would rather invest my savings,foreign exchange in Dubai or Australia or Canada or USA rather then buying real estate in Pakistan.Pakistani currency exchange rate is dropping, Pakistani economy is on collapse and with the current law and order situation, bombings and killings I would never spend so much on real estate in Pakistan.
Anthony
Oct 09, 2012 02:04pm
Workers prefer to work for foreigners because they receive more respect in most cases.
lfahfn
Oct 09, 2012 11:03pm
You are right as your enjoyment and non boring activities must involve brothels bars and others non- soical acts which I am sure you will not find openly there. For that you will have to dig deeper into the particular mind set class. Better never come back, stay away.
Dr. Osman Khan
Oct 09, 2012 03:12pm
I believe the prices have actually come down quiet a bit in the past 4-5 years. At its peak, the average price of a house in Islamabad was around 1 million pounds. Now it
Virginian Quetta wala!
Oct 09, 2012 01:20pm
Islamabad was never a common Pakistani's place to live in. I don't see a harm in foreigners paying extra bucks for the right and possibly only relatively secure place in the country. I have always loved Islamabad and look forward to having a home there.
roquefort
Oct 09, 2012 01:45pm
Dream on.Personally even a day there was unbearable.The most backward n boring place I have been to. I have travelled in all the continents except Antarctica.
dalbir
Oct 09, 2012 01:47pm
Property rates in Mumbai are about USD10 million per Kanal & same in South Delhi areas where a Kanal kothi goes for anything between 8 millionUSD to 10 million USD
Abdul Abdul
Oct 09, 2012 04:44pm
Useless article! As an editorial director, would like to see analysis of this situation - what, why and how are people - general public, businessman and government dealing with this problem! Real estate price in Islaisbad is as high as Beverly Hills - so what! Crime, pollution, freedom, amenities, luxury, opulence comes nowhere close to Beverly Hills.
Ali Usman
Oct 09, 2012 02:26pm
Did someone as you about land prices in you city?
Agha
Oct 10, 2012 12:54am
Arpan, Yes, non Muslims are allowed in the mosque.
Ajamal
Oct 10, 2012 09:03am
My memories of Islamabad relate to late '60s and early '70s when it was green, clean and dead.
Muslim
Oct 10, 2012 02:25pm
i like to visite the red coridoor area of india ........if its allowed for media to report form there or outsider to visite, last i heard like yesterday both are not allowed
cheap pia flights
Oct 10, 2012 02:43pm
Islamabad is developing very rapidly, nice homes and nice commercial district something to be proud of
Ahmed Sultan (India)
Oct 10, 2012 06:04am
Freedom of speech
OKHA
Oct 10, 2012 05:35pm
hmmm... intresting... this technically means that property prices in islamabad are not inflated or unrealistic ..... but it could also mean that both islamabad and bombay have a property bubble ...which will burst! :)
OKHA
Oct 10, 2012 05:31pm
yes i agree the commercial use of residential property is the main cause of this ... but i think i will end soon as centraus is built and CDA expands blue area ....
Asad Shah
Oct 10, 2012 03:56am
I have travelled half of the world and lived more than 30 years in Islamabad as well, and I have yet to come to a better city to live in than Islamabad (I rate Prague in Czech Republic higher than Islamabad if I have to chose a place to live). Perhaps you have a typical ignorant foriegner attitude towards the city, and perhaps you did not even get to venture out of your hotel out of precieved threat to your life. What a pity!
homie
Oct 10, 2012 03:20am
boss even chicago and new york is boring....if you know how to party and live life.....you could have it anywhere. personally I love islamabad....recently visited south florida...some posh localaties.....kept thinking I have been here......then made out it really smell,feel like Islamabad..... Its way expensive than Delhi and mumbai .....only rich can afford whereas Delhi is more like Lahore...n Karachi is like mumbai......India is great no doubt....but they have no city like Islamabad,its being built to accomodate foreign missions and country's parliament. I have lot to say but no time....
circut00
Oct 10, 2012 03:05am
Best wishes mate!! But do you know Islamabad is street by street copy of our own Chandigarh?? Google it......
dalbir
Oct 09, 2012 02:53pm
there is something called free-spirit. and, they do not take orders from others. thank you
Nadir El-Edroos (@needroos)
Oct 09, 2012 09:02pm
Well, you call this real estate racisim, this is exactly how all the peasants and farmers who were forced of their land to make way for Bahria Towns and DHA's feel. You are complaining about a problem the affluent face, while ignoring how such behaviour is prevalent all around us on a daily basis, and the same monied classes call that "nation building". For shame!
Usman
Oct 09, 2012 09:26pm
I was thinking the same thing the other day, I can name several dozen NGOs who are located in residential buildings and pay exorbitant rents, which isn't so exorbitant for them as it's not their money anyway, leading to extremely inflated housing prices. There's also the fact that commercial enterprises running their business/charity out of residential areas pay for utilities at residential rather than commercial rates. Perhaps if they were made to relocate to commercial premises we'd have a nicer skyline in Islamabad too.