LDA City to grant property possession next year

• Currently, Zameen.com, as LDA City's exclusive marketing and sales partner,is offering them at a starting price of PKR 2.395 million.
• NAB is serving as an arbiter of any dispute that arises between the public, the LDA City authorities, as well as the project’s development partners.
• Vagaries of the market aside, the general expectation from the current state of the market and the project’s ongoing developmental work is that the prices are going to appreciate further.

The LDA City project has been in and out of the news these past few years. It was launched in 2014 with many of the typical slate of promises now expected of any high-end housing project; including the provision of state-of-the-art residential facilities, an ‘ultimate ‘ luxury experience, and a lot of modern town planning finesse. Where the scheme’s marketing differed, however, was with respect to the developers’claim of its being the ‘largest public housing scheme in the country that will house 50,000 families’ – a pitch that has certainly managed to catch a lot of serious investor and prospective home owner interest since its popular debut.

But when considered in terms of its ground reality, and as late as December 2018, the project authorities didn’t even have the complete bearings of the required developmental land for the initiative at their disposal. And it was only after the Supreme Court disposed of the case in January 2019, followed by the subsequent, oversight-oriented, intervention of the National Accountability Bureau (NAB) in the proceedings,that the LDA City apparatus kicked into full-action.

An upturn of fate

As a result of these state-mediated developments, a number of things happened.

The project’s file prices, which, in December 2018,had been faring at their lowest figures in nearly two years, immediately began to register a recovery. Currently, Zameen.com, as LDA City's exclusive marketing and sales partner,is offering them at a starting price of PKR 2.395 million.

Just around the same time,LDA City’s developmental partners began acquiring the requisite land. Within a year, the first ballot was announced in the project and, now, the second ballot has also been scheduled for February 14 this year.

The most anticipated news to come out of the project so far, however, is that its plot possessions are to be granted next year: 2021.

LDA City is located on the main Ferozepur Road and boasts a great location with multiple entrances. It is also directly accessible from the southern arc of the Lahore Ring Road; while being situated at a distance of about 1.5 kilometres from the Gaju Mata Metro Bus Station.

In the context of all these developments, the recent upsurge of both popularity and prices observed in the project does not come as much of a surprise.

Predictions of rising prices

As mentioned, the prices were quite low in the project throughout the last quarter of 2018; with the selling price for a 5-marla plot being, reportedly, only PKR 1.3 million at the time. A little over a year later, the files are now being sold for nearly PKR 2.4 million – corresponding to an 84% appreciation.

Vagaries of the market aside, the general expectation from the current state of the market and the project’s ongoing developmental work is that the prices are going to appreciate further. This estimation is based on the general observation – which can be deemed a market principle – that a project’s real estate prices are pegged to its developmental status; so the greater the degree of development work, the higher the unit prices fetched, and vice versa

Additionally, the two (already mentioned) inter-related issues of the upcoming ballot event and the granting of property possession are sure to attract a lot of mid-term investments; further driving the project’s demand curve up, and thereby increasing prices.

When judged narrowly from an investor’s perspective, property possession is the ultimate target;particularly after the recent changes introduced in the country’s taxation regime (including those made to the Capital Gains Tax) which have led medium-term holdings to become the most lucrative real estate investment options. So for anyone blessed with the requisite holding power, the best option now is to maintain investments until possession; since that is when the end-user is going to become interested in the project – triggering another surge in prices.

A similar argument could be made for end-users buying plots in the project right now. The prices may go beyond the reach of a lot of middle-income buyers post-ballot; meaning that it would be wise for them to make haste in securing their LDA City land areas while the window of opportunity still presents itself.

Good portents

Now one can, with reason,choose to be dismissive of the claim of the LDA City administration regarding the provision of plot possession within a particular time frame; given their past record. But what lends this announcement additional credibility is the fact that whereas, previously, only the Supreme Court was involved in overseeing the project’s development; currently, NAB is also being kept updated on its progress. The accountability watchdog has also issued statements which, essentially, state that the court cases pertaining to LDA City would all be cleared soon.

Additionally, NAB is serving as an arbiter of any dispute that arises between the public, the LDA City authorities, as well as the project’s development partners.

The remedial measures taken in the last year – expedited, as referenced, by the involvement of NAB and the apex court – must come as a relief to the people who had bought their LDA City project files over two or three years ago.

Individuals who choose to invest in the project right now, however,would not have to face any frustrating setbacks of this nature. Sure, the returns may not be as high in 2020; but this concern is largely offset by the speed at which they can be accrued. And in only a year’s time – after which plot possession becomes available – you (as an LDA City plot owner) will find yourself in a position to sell with the promise of hefty returns in the offing.