Role of Real Estate Sector in Pakistan’s Economic Growth

The real estate sector has always played an important part in Pakistan’s economy. The real estate industry is a great way to revive and strengthen the economy of Pakistan. This is because of its ties with the associated industries involved in the construction sector. More than 200 industries are linked with real estate ranging from the provision of cement to the raw material used in the construction of properties and buildings. We can say that the real estate development and construction sector contributes above 9 percent to the overall GDP of the country. However, this sector has always been ignored as a prospective source of economic growth and improvement.

Real Estate Contribution to Economy:

The real estate sector has always been the backbone of Pakistan’s economy. The real estate & development sector offers a viable source of income with the potential for capital expansion and appreciation. The industries connected to real estate construction include cement, timber, steel, electric fittings, paint companies, cables, furniture, plastics, and electronics. This is also the second-largest income-generating sector within the country, with being agriculture the first.

Hurdles in Real Estate Growth:

Successive governments have overlooked the real estate sector making it hard for real estate development companies to invest with peace of mind in the industry. The biggest hurdle in the growth is that the process is so complicated and with so many loopholes that any seasoned investor has to think twice before investing. Although, many reliable projects are being built and so many foreign investors are investing in big projects, thanks to China-Pak Economic Corridor (CPEC).

One more issue is the matter of taxation. Since the taxes imposed were very lenient, the country’s economy was unable to benefit from the purchase and sale of housing projects on a larger scale. However, the incumbent government is trying to impose reforms in the real estate sector to make it a profitable industry for the country.

Potential of Real Estate in Pakistan:

The real estate sector came under the limelight after the current government realizes and started initiating actions to improve the sector. One of the biggest hurdles that investors face when investing in real estate development in Pakistan is the lack of transparency and reliability. This government has initiated reforms to digitize the data for accountability that gives confidence to investors. Overseas Pakistani’s are showing their interest now to put their investments in the industry.

The trend of gated communities and luxury apartments in Pakistan is becoming increasingly popular. Many marketing and management companies like Extell marketing development are encouraging overseas Pakistani’s to invest in the sector. With their property marketing and management services, they are assisting so many potential investors by boosting their confidence in the real estate sector.

The government is also showing so much interest and has launched the “Naya Pakistan Housing Scheme” to help people build their dream housing. The government is providing low-cost housing loans to people at low-interest rates to encourage the housing sector. This initiative is playing an important role in introducing affordable living for citizens of Pakistan.


Real estate has great potential to become the biggest contributor to Pakistan’s GDP. With more than 200 industries under the real estate umbrella, this growth can’t only solve the housing crisis of Pakistan, but will also create massive employment opportunities. Better tourism and overseas relationships will bring better performance and contribution of the real estate sector. This will bring more investment and revenue for the government.