Real estate development in Pakistan has emerged as one of the most significant economic forces over the past two decades. From Karachi’s rapidly expanding skyline to Lahore’s ever-growing suburbs, real estate has fueled economic growth and provided much-needed jobs. However, this development has also brought with it a host of economic challenges that threaten the country’s long-term stability.
The sector’s unchecked growth has led to economic distortions, speculative bubbles, and social inequality, while also benefiting allied industries and providing employment to millions. Real estate development in Pakistan has been a major contributor to economic activity, representing approximately 3% of the country’s GDP. The sector has seen robust growth, particularly in urban centers like Karachi, Lahore, and Islamabad, where property prices have skyrocketed.
Between 2015 and 2024, property prices in these cities have increased by nearly 300%, according to estimates from the Pakistan Bureau of Statistics (PBS). This surge has been driven by a combination of rapid urbanization, speculative investments, and a perception of real estate as a safer investment compared to the volatile stock market. Moreover, the construction boom has had a ripple effect across the economy, stimulating growth in allied industries such as cement, steel, glass, and furniture manufacturing.
The construction sector itself saw growth rates of up to 8% in 2023, providing employment to millions of laborer.