FBR notifies amended property valuation for Karachi

KARACHI: The Federal Board of Revenue has notified amended property valuation rates for Karachi with a view to bringing them closer to the actual market prices.

For properties in Karachi, a new category ‘I-plus’ has been formulated, where commercial properties – plots and build-ups, have been revalued at Rs160,000 and Rs80,000 per square yard. The commercial properties of Defence Housing Authority (DHA) phase I to VIII falls in this new category. Previously, most of these commercial properties fell in ‘I’ category, which had a valuation of Rs123,750 for plots and Rs73,125 for built-up properties, showing a 30 percent and 9.4 percent increase respectively.

The value of DHA commercial plots facing the different Khayabans, have increased by 10 percent. The value of commercial buildup units excluding ground floor is reduced by 25 percent. In case of DHA residential plots with some drawbacks, like if they are facing Nullahs, commercial plots, school, mosque or a graveyard or is a rear plot (backside plot) or a triangle plot, would see a decrease in the valuation rates by 25 percent. A rear plot is the one lying behind the front portion only connected with a separate narrow corridor and not visible from the road.

The FBR has also given year-wise depreciation value of commercial built up properties. There will be no reduction in value of properties up to to 10 years, followed by a 5 percent decrease in that for 10-15 year old properties, 8 percent decrease for 15-20 year old properties and a 10 percent depreciation for all properties over 20 years.

Praising the new changes, real estate agent Mohammad Shabaan, said it was good that the valuation of properties with drawbacks like Nullah facing etc have been reduced. However, he said the government should have changed the valuation in the budget, which is just a few months away. It would have made it easier to keep records and follow them.

Former Chairman Association of Builders and Developers, Hassan Bakhshi, said the change will help document the economy. However, he said there were no major change in valuation in properties of Karachi. There were major ambiguities in valuation rates of properties in Islamabad and Lahore, which have been removed, he said.