Ayesha Saba

Pakistan’s outdated real estate laws need to be modernized for sustainable growth, as regulatory gaps and weak enforcement continue to hinder investment and limit economic potential, said Dr. Shahid Mehmood, urban development researcher at the Institute of Policy Studies (IPS), in an interview with WealthPK.

He emphasized that much of the real estate market operates in regulatory grey areas. The lack of a uniform property registration system and digitized land records often leads to ownership disputes and discourages institutional investment, he noted.

According to him, reforming land titling laws and implementing a centralized, tamper-proof record system would significantly reduce corruption and litigation while increasing investor confidence.

The real estate sector, which accounts for nearly 2.5% of Pakistan’s GDP directly and indirectly and supports dozens of allied industries, remains plagued by informality and legal ambiguity.

Developers and buyers often face delays in project approval due to non-harmonized zoning laws and discretionary powers of multiple local authorities.

“Inconsistencies between provincial and municipal regulations result in delays that can last for years. The fragmentation creates loopholes, making room for manipulation and increasing costs for genuine investors,” he said.

Recent efforts by some provincial governments, such as Punjab’s attempt to digitize land records through the Land Record Management and Information System (LRMIS), have been hailed as a step in the right direction.

The Capital Development Authority (CDA) has also decided to digitize land records and introduce e-stamp papers in Islamabad to streamline property transactions and enhance transparency. This initiative includes establishing digital service centres and aligns with the federal government’s push for digital governance.

However, he advocated a broader overhaul of real estate laws, including clear tenancy frameworks and enforceable development regulations, to ensure legal predictability and foster long-term planning.

Talking to WealthPK, Sana Iqbal, a property rights lawyer, highlighted that countries with robust real estate legal systems typically see higher volumes of foreign direct investment (FDI) in housing, infrastructure, and tourism sectors.

She added that unless the ease of doing business in this sector improves, the real estate market will continue to lag behind regional benchmarks. “Pakistan can unlock billions in private capital if investors feel protected by the legal system,” she said. Recently, the IMF urged Pakistan to take firm measures against property value misdeclaration.

The government assured the IMF of activating the Real Estate Regulatory Authority, which will be empowered to impose strict penalties, including imprisonment and fines, on individuals and agents who provide false property valuations.

Credit: INP-WealthPk