Key Takeaways
- The government plans to increase mortgage finance to 5% of GDP by 2035.
- Annual housing units to be built will range from 300,000 to 400,000.
- The plan includes digitizing land records and implementing one-window construction approvals.
The government has proposed a significant expansion of the mortgage finance sector, aiming to raise it to 5% of gross domestic product (GDP) by 2035, up from the current level of less than 0.5%. This ambitious target is part of a broader housing reform framework presented by Waqas Anwar, Member Planning Commission, during a meeting of the eighth National Economic Mission.
The plan also includes the construction of 300,000 to 400,000 housing units annually, addressing the growing demand for housing in Pakistan. According to the Planning Ministry, Pakistan’s urban population has increased from approximately 76 million in 2017 to 94 million in 2023, with an annual shortfall of about 450,000 homes.
Federal Minister for Planning, Development and Special Initiatives, Ahsan Iqbal, highlighted the importance of the real estate and construction sectors, noting that they support 72 allied industries and account for approximately 9.5% of national employment. He emphasized the need to modernize construction practices and promote vertical development to better utilize limited land resources.
The minister also pointed out that built-up areas in major cities have significantly increased, with Islamabad seeing a 104% increase, Lahore 59%, Karachi 43%, Peshawar 44%, and Quetta 72% between 2005 and 2022. This growth underscores the urgent need for better land management and urban planning.
To achieve these goals, the government plans to digitize land records, permits, valuations, and transfers by fiscal year 2029. One-window construction approvals, incentives for verified construction milestones, and secure escrow payments for property transactions are also part of the reform package.
Ahsan Iqbal stressed the importance of collaboration between the public and private sectors to build a stronger economy. He emphasized that the construction sector should not only meet domestic requirements but also be developed as a source of exports, investment, and foreign exchange earnings.
The minister highlighted Pakistan’s strong pool of skilled and technical human resources, noting that Pakistani workers have demonstrated their capabilities in the construction sector across the Middle East. However, he also called for Pakistani construction companies to build a stronger international presence and compete in global markets.
The plan aims to activate every sector of the economy to achieve the vision of a $1 trillion economy, with the real estate and construction sectors playing a crucial role. The government believes that by modernizing and expanding these sectors, Pakistan can address its housing challenges and contribute significantly to economic growth.
