Real estate is among the top five industries
Real estate is among the top five industries of the world in terms of revenue generation. This sector comprises 3.5 percent of the global GDP and thus is by far one of the most significant wealth accumulative sectors. The overall worth of this sector is around USD 200 trillion. Irrespective of the low level of volatility offered by this sector, it has always huge demand in the world of investment globally. Investment in the real estate sector is known for
- Steady and stable growth
- Continuous rise in value
- Safest investment zone
- Source of income stream
- Hedges against inflation
Revival of real estate sector
Though investors’ confidence got a hit after the 2008 financial crisis and later in 2016, mostly due to low oil prices and global political uncertainty. It soon reverted back to its track due to the high demand and promising returns offered by this sector.
The following reasons majorly contributed for the revival of real estate sector.
- Intensive reforms in the sector globally
- Reduction in interest rate
- Mortgage rates were balanced with national economic growth
- Diversity of investment opportunities – residential and commercial
- Utilization of developmental budget in construction sector
Real estate is the only safe investment during COVID-19
Coronavirus pandemic has halted all of the economic activities and most of the businesses are closing down. Interestingly, even during the current pandemic the investment in real estate sector has remained normal.
Steadfast behaviour of the property sector is backed by
- Sudden decline in interest rate worldwide
- Lack of investment opportunities in other sectors
- Lucrative incentives offered by the governments
- Safety of principle investment amount
- Tangible nature of the land asset
What the World Bank says about real estate!
Realty sector poses huge influence when it comes to restoration of national and international economies around the world. Counties around the world know that this is among the few sectors that could help in revitalizing the economy and fighting the economic recession.
According to a report by World Bank, real estate sector constitutes around 65 percent of total wealth of a country. Same is the case in Pakistan, where investments in Bahria Town Lahore and Karachi has given a new style to the housing and business. High return investment opportunities in Bahria Town Lahore and Karachi generate huge cash-flows that ultimately contribute to the national economy.
The high inflow of investors toward this sector is eminent through
- Greater investment in realty shares by investors
- Banks increasing the share of real estate portfolios
- Demanding increase in the construction and development
- Uncertain situation of variable investment assets