Local real estate market lags far behind regional peersa

KARACHI: Pakistan is one of the underperforming countries in the region when it comes to transparency, regulatory mechanism and infrastructure in the real estate market, according to a latest global ranking.

The country ranked 73 on the latest Global Real Estate Transparency Index released by global provider of real estate and investment management services Jones Lang LaSalle (JLL).

The index ranks 99 countries and territories and 163 cities globally. The index assesses real estate market transparency based on over 200 individual indicators relating to: investment performance, market fundamentals, governance of listed vehicles, regulatory & legal environment, transaction process and sustainability.

Pakistan’s rank is little better than Iran’s 76. But, it is worst compared to India’s 34, Indonesia (40) and Sri Lanka (65).

India, Indonesia, the Philippines and Vietnam are among the index’s top improvers due to regulatory reforms, enhanced market data and sustainability initiatives.

The recent real estate regulation and development law is expected to help the country improve its ranking on the index by introducing transparency in the real estate sector.

The government is focusing on real estate and construction sector to buoy growth that contracted 0.7 percent during the last fiscal year as lockdown related to coronavirus pandemic adversely impacted the demand. The growth is expected to end in the positive territory during the current fiscal year.

The index reveals that transparency is continuing to progress across most countries and territories. However, an average transparency score improvement of 1.1 percent since 2018 marks the slowest rate of change since the period directly following the global financial crisis.

“While 70 percent of countries have registered an improvement in score, this is the lowest level in 10 years, highlighting that many jurisdictions are struggling to maintain progress,” it said. “With growing pressure from investors, businesses and consumers, real estate transparency will need to improve further and faster to compete with other asset classes and to meet heightened expectations about the industry’s role in providing a sustainable and resilient built environment.”

The top ranks continue to be led by Anglophone countries, with the UK, the US and Australia in the top three positions. A number of European markets are continuing to make progress within the top tier, with Ireland among the top global improvers and France also registering notable gains.

Sweden and Germany have also seen advances, sustainability initiatives and robust property technology ecosystems have contributed to their improved standings.