ABAD rejects increase in property valuation rates

Chairman of the Association of Builders and Developers (ABAD) Asif Sumsum, expressing serious concerns, has rejected an increase in the valuation rates of immovable properties in Karachi by the District Administrations.

Talking to Business Recorder, the ABAD chairman said that property prices have dropped significantly amid the economic meltdown but the caretaker Sindh Government is increasing property prices, which is very surprising.

“If anyone thinks the builders or developers will pay this then they are wrong. It will be passed on to end buyers, who are already finding it difficult to buy a house,” he said.

There is already a shortfall of 12 million houses in the country and another 700,000 houses every year and the need for 700,000 houses adds up every year. Sumsum said that under the present economic situation, only 50,000 new houses are being built in the country annually.

“They blame the IMF (International Monetary Fund) for pressurizing them to take such decisions to ramp up taxation. However, we see IMF officials talking about relief for common people. Increasing valuation will mainly affect common people in making it more difficult to buy a house.”

“Making houses expensive and inaccessible for common citizens has forced mushroom growth of slums in the country, which in turn increase criminal activity in the society.”

Former ABAD Chairman Hasan Bakhshi told Business Recorder that the increase suggested by the District Administration has exceeded actual property prices in the country.

“Such anomalies happen when decisions are taken without taking stakeholders on board,” Bakhshi said.

Meanwhile, Sumsum separately in a statement has demanded of caretaker Chief Minister Sindh Justice (Retired) Syed Maqbool Baqir and Caretaker Revenue Minister Younis Dagha to take notice of this serious issue.

“The property prices have decreased by 40% percent at this time, the increase in the valuation rate is incomprehensible and that this move by the District Administration will cause irreparable damage to the already struggling construction industry,” Sumsum said.

He said that there are already a number of taxes on the construction sector and the increase in the valuation rate of the properties will put another heavy burden of taxes on the builders and developers as well as it will affect the general public seeking to own their homes.

Chairman said that despite the fact that the construction sector is already suffering from crises, members of ABAD are continuing their construction activities across Pakistan, which is bringing multifaceted benefits to Pakistan.

“The construction activities are providing employment to millions of people and the country's exchequer is also getting stability in the form of taxes,” he said.

He said that the construction sector is supported in times of economic crises around the world since it enabled more than 72 allied industries to boost activities and create more jobs.

“The construction sector is given extra incentives and subsidies in taxes amid economic meltdown. But it is very surprising that the District Administration is hindering the construction sector instead of facilitating it,” he said.

He demanded the Caretaker Chief Minister of Sindh to withdraw the increase in the property valuation rates, which are increased without consulting stakeholders.

“If no one can buy a house due to lack of purchasing power, the construction activities will come to a standstill leading to huge loss in the government treasury and bring unemployment storm across the country,” he warned.