CategoriesBusiness Investment Property Investment Real Estate

Post-Flood Situation and Construction Industry in Pakistan 

Pakistan has been seriously affected by the recent floods 2022 as it has prompted enormous harm to the country’s actual foundation including damages to homes, roadways, private commercial and government buildings. According to National Disaster Management Authority (NDMA) a combined material loss of 1.76mn houses (Slightly and Completely Harmed), 390 government buildings and roads (distance of 12,718km) has currently occurred till Sep 14, 2022. This will render the private and government stakeholders to rehabilitate the constructional loss.

Nexthome.pk analyzes that the scope of building reconstruction will grow real estate property development in the following months. So, housing and finance bodies will increase the investment volume. That will further lead to growth in the property development sectors.

Building Material Supply Demand to Increase 

Given the seriousness of the circumstance, we got various questions on the concrete area viewpoint critically after Post-Flood Situation and Construction. To get a better understanding of the circumstance and from the area’s standpoint, we led a review of Pakistan’s driving concrete producers. The building materials aggregately address 76% of the absolute business size regarding plant limit. Request standpoint for FY23 and FY24: Our review results show that 75% of the stakeholders expect homegrown concrete dispatches to fall in the scope of 0 to – 10% YoY in FY23 versus 2M FY22 fell 35%. On other hand, around 17% of the members expects development of 10% or above and 8% in building affairs. It will anticipate that it should increase by 0-10%.

Cement Price Needs Equilibrium 

There are concerns that whether increased demand of cement could again cause pressures on concrete building construction lines. However, we accept that the high demand could confront delays uniquely greenfield projects where SBP had forced limitations on import of raw materials. Some of the supply requirements that were normal in FY23 and FY24 could be deferred to FY24 and FY25. We have noted cement bag cost increased from Rs1,025/bag to Rs1,050/bag) for FY23. Our cost presumption for FY23 is inline with the review results that show construction costs will exceed 10-30%. Then again, the decrease in cement supply in FY24 will gear up average construction cost 5-10%. 

What Should Homebuyers Do?

After the analysis, it’s obvious that construction costs will boost enormously. So, Nexthome.pk suggests that homebuyers can consider apartments for sale rather than flowing money on construction of a new house. Apartments are far more cost-effective than houses. You can find 1,2,3 and 4-bedroom apartments on our online property portal Nexthome.pk or dial 0304-111-0309 to buy, rent and sale an apartment.

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