The economy of Pakistan is quickly expanding, and the real estate market is one of the areas where growth is projected to be exponential in the years to come, starting in 2022. Online real estate marketplaces, digital mapping, the modernization of land records, and the adoption of global best practices in client-agent interactions are all contributing to Pakistan’s development.
Investors are eager to invest in digital real estate alongside traditional residential and commercial real estate developments with the emergence of blockchain technology and crypto. Moreover, Real Estate Investment Trusts (REITs) are also developing as profitable investment prospects for the local people of Pakistan.
The Metaverse, asset tokenization, sustainable development, and vertical housing infrastructure, of the real estate sector, are the most significant real estate trends for 2022. Through digital platforms and affordable housing entities, these trends will provide foreign and local buyers and investors with a wide range of chances to participate in inexpensive real estate while assuring increased regularization and transparency.
Below is the list of top trends in the real estate sector:
- Metaverse
- Real Estate Investment Trusts (REITs)
- Asset Tokenization
- Vertical Infrastructure development
Metaverse
Digital real estate is becoming more and more popular as a successful investment strategy, and the Metaverse is expected to be the largest trend of 2022. For those wishing to diversify their property holdings, it is a fantastic window of opportunity. Blockchain technology is used by Metaverse in place of the established, old, and traditional financial system. The new stage of the digital revolution will be where people control the stakes of their assets in the specific digital platform because Web 3.0 is the era of the open crypto metaverse. The metaverse offers a variety of advantages for investment in the real estate sector.
Furthermore, the metaverse enables investors to profit from the growth of the virtual property. It also enables property rentals for investors and buyers and compared to real estate, input costs are often cheaper and affordable.
Real Estate Investment Trusts (REITs)
REIT Schemes are a fantastic and cost-effective method to make better real estate investments and diversify one’s property holdings. The largest trend in Pakistani real estate in the future years will be REITs. REITs are among Pakistan’s most practical methods to invest in real estate due to their large dividends, liquid investments, and long-term growth and appreciation.
Since REITs are total-return investments that offer substantial dividends and long-term capital appreciation, investing in them brings about many advantages. Because REITs are required to be listed on the stock exchange, investing in a REIT plan differs from investing in a conventional real estate project. As a result, investors and buyers will invest directly in the booming economy and increase the return on their capital.
Additionally, most REIT Schemes must distribute 90% of their taxable profits to investors and unitholders, and therefore, REIT dividends are significantly greater than those of the typical investment. Furthermore, the legislation only permits fifty (50) participants per REIT scheme, ensuring that investors get bigger dividend distributions.
Asset Tokenization
The rapid adoption of blockchain technology has created new and better opportunities for the development of virtual properties around the world and in Pakistan as well. For instance, asset tokenization is a procedure that enables an “issuer” to produce electronic tokens on a distributed ledger or blockchain that can then be exchanged according to their market value accordingly.
In other words, it turns ownership rights in physical assets into digital tokens and therefore turns them into digital assets for digital processing in the future. Furthermore, it provides more liquidity at lower prices and with quicker settlements. Additionally, it eliminates the role of a “middleman” as well.
Tokenized assets also have a high degree of divisibility, which lowers entry barriers for investors and buyers by allowing them to participate in small amounts. For instance, a tokenized digital asset has a 10% share limit that investors cannot exceed. As a result, it will keep gaining popularity since it offers investors in a variety of sectors, including real estate, commodities, private equity shares, and physical products, a variety of better investment choices.
Sky-rise Infrastructure Development
In recent years, Pakistan has had a severe housing deficit of more than 10 million units, according to UNDP. In stark contrast to the expansion of housing stock and the availability of land for residential use, the pace of urban population growth has increased. This housing shortage suggests that Pakistan will experience a rise in the creation of accessible vertical dwelling units. In order to lower living expenses, improve the amount of green space, and create a sustainable urban model, the government has also suggested investing in such dwelling units.
Moreover, the usual methods for building and developing are still being altered by climate change. Therefore, in 2022 renowned developers and real estate companies developing eco-friendly and green high-rise structures, providing local and foreign investors a greater investment opportunity for higher returns.
Conclusion
In conclusion, asset tokenization, digital real estate, REIT schemes, and high-rise development are the top real estate trends for 2022. In 2022, the price of residential and commercial real estate will keep on increasing further. Nevertheless, a variety of low-investment alternatives will also let local and overseas investors and buyers diversify their real estate holdings. Additionally, as environmental consciousness and eco-friendly construction continue to grow, investment opportunities in vertical housing schemes are expanding as well.
