The real estate market is finally showing signs of life after being sluggish since announcement of Budget in July 2016. In May this year we warned you about the investment bubble in 9 prism. While some will blame the taxes, i personally blame the higher prices for the downtrend that followed after July 2016. The prices of 9 Prism plots are are now back near the normal range after a correction of 15 to 20%. Now the big question is should you buy or should you not buy 9 Prism plot?. I am writing this article specifically because of a comment posted on our Facebook page.
Imlaak is a real estate investment consultant company and our mission statement is as under:
Improve the way our real estate industry operates, reinventing how it works, focusing on consultancy , transparency and management, providing you with an unbiased market analysis and future prospect.
Our trading strategy focuses on safer genuine investments rather than artificial hypes. We try to stay clear from the investment bubbles created by local investors and real estate agents. This is exactly what we have done when it comes to 9 Prism, we warned you before hand, exactly 2 months before the bubble busted. Those of you who listened are happier now and planning to jump on another buying opportunity in 9 Prism, those who have not will just have to miss the train this time around.
Is 9 Prism still over priced?
The answer is YES, the prices of plots in DHA Lahore 9 Prism are still higher than they should be. In order to understand you have to look at other commodities available to you for investment in DHA Lahore. The closest in comparison are DHA Lahore Phase 7 and 9 Town.
DHA Lahore Phase 7 1 Kanal Plot price which ranges from 100 Lacs to 170 Lacs , 100% development charges paid and 100% developed. In comparison to Phase 9 where 1 Kanal plot price ranges from 80 Lacs to 140 Lacs with 4 installments of development charges paid. This means that the actual price for a 1 Kanal plot shall be 90 Lacs to 150 Lacs plus a wait of 5 years for possession.
Same is applicable to 9 Town Vs 9 Prism when it comes to 5 Marla Plots. An average plot of 5 Marla will cost 5 Million in 9 Town , fully paid and developed where as in 9 Prism it will cost you 4 Million and 5 years before it is developed.
So either way one of the following two things is true:
- DHA Lahore Phase 7 and 9 Town are under priced. Or
- DHA Lahore Phase 9 prism is over priced.
No matter which one you believe in the logical conclusion is the same:
It is better to invest in DHA Lahore Phase 7 and 9 Town, instead of 9 Prism.
What is so special about 9 Prism?
Lets hear some arguments in favor and against DHA Phase 9 prism Lahore and decide for yourself.
It is the biggest phase of DHA Lahore
- Agreed, but does it make it the best as well?. I highly doubt that this characteristic of a phase determines its success. DHA Phase 1 to 5 are now a complete complex and same is applicable to Phase 6, 7 and 8, Phase 1 to 5 complex is almost adjacent to Phase 6 to 8 complex with just Bedian road in between. Phase 9 Prism is actually a bit isolated from these two major developed complexes.
It is very well planned
- It has 50 Parks , saddle and polo club, Golf course and commercial areas. Right, we have Defence Raya Golf course in Phase 6, polo club by Pakistan army is being constructed adjacent to Phase 8, theme parks are being planned in Phase 7, Broadway commercial is the biggest commercial of DHA Lahore in Phase 8, there are more than 50 Parks in DHA Phase 8 alone.
It has an excellent location and access
- Yeah right but compared to what? does it have a better location than DHA Phase 8 or 6 ?. Which are adjacent to Lahore cantt & Airport and right on the ring road.
It is planned aesthetically
- Yeah, i agree that it has blocks which look like prisms on the map and will look like that from the sky as well after it is developed, but is it practical on ground?. Actually i have no idea what DHA town planners were thinking when developing this phase, The curvy roads and complex streets will make it so much hard for any one to navigate once developed. The plots are also effected and in so many areas they will not have regular dimensions. To me aesthetic is symmetry and uniformity and i do not see much of that in Phase 9 Prism.
It will be developed very fast
- Rightly so and DHA is working on it, but does that mean it should be valued more than the Phases already developed?.
The prices are very reasonable
- I do not agree with that because the prices may seem ok but they are not in real terms. This is a little bit psychological and needs some understanding. Realtors usually do not take into account the development charges you have to pay and you do not feel like it either. Lets suppose you buy a 1 Kanal plot for 120 Lacs in block A today, you feel like you are paying only 120 Lacs today but in real terms you are paying 14 Lacs extra as well in lieu of development charges. In two years time if the plot goes and hits 150 Lacs , what are you really saving? is it 30 Lacs or is it 16 Lacs.
Why is 9 Prism so popular ?
The only reason it is popular is because the plot price, which makes it a heaven for short term traders and real estate agents. The biana culture is the only thing promoting to buy 9 Prism Plot, take that out and the prices will collapse.
To buy 9 prism Plot is good for investment?
Yes, if you plan to buy 9 Prism plot, it is good for investment. It is DHA after all and whatever they touch is turned to Gold. If you are planning to invest in Phase 9 prism consider asking yourself these 3 questions.
- When, where and how is the main question when it comes to investments in DHA Lahore 9 prism. I have no doubts that sooner or later it will be developed, houses will be built and elite of our society will live in it, but what is the time frame for that ?, 5 to 10 years or 15 – 20 years.
- The other question is related to its high price, why should you invest in Phase 9 Prism when you can buy a 1 Kanal developed plot in DHA Lahore Phase 7 in almost the same prices.
- 3rd question you need to ask yourself is how long you plan to keep your plot and what is the possible return on your investment. Phase 9 prism is a heaven for short term traders, it is also very lucrative for long term investments.
Will we invest in 9 Prism
Yes, we are planning to buy 9 Prism Plot for some short term investments in 9 prism. We are also recommending it for long term investment if you are not worried about the ups and down it may go through in next 5 years. However if you plan to invest for an year or so , i believe it may not be a good idea and will not give you optimum yield.
So whats the plan?
This plan is based on the present market conditions and may vary if the market changes it’s course.
- If you are a short term trader, planning for a couple of months investment not exceeding beyond june 2017. Phase 9 Prism is a good opportunity to cash in. However all will depend on your buying price and Biana trades may give you the maximum returns.
- If you have 10 Million or less and you want to trade in DHA , than going for a 1 Kanal plot in Phase 9 prism is one of the best options.
- Go for 9 Prism, if you are a long term trader and only eyeing the possession of 9 Prism after 4 to 5 years.
Best is to wait and not rush in to buy 9 Prism Plot. It is better to get a fully paid plot in Phase 7 in 120 lacs rather than buying one in 120 plus 14 Lacs (Development charges) in 9 Prism. Hold it and wait for 2 years to sell it. I personally feel you will get a better buck for your money, as it will be sold for 150 to 160 Lacs and move into 9 prism where the same plot will probably still be available between 130 to 140 Lacs. Technically you have invested 1.4 Million less and saved 1.4 Million more.
I do warn you that short term traders may pull the prices of 9 prism to 160 to 170 lacs, (We already recommended short term trading) but that bubble will burst again as it did in July 2016. Also i guarantee you that if you follow this plan, you will get a good holding position in 9 Prism , just a few years before its possession and that too with some extra bucks in your pocket.
I still wanna buy NOW
Well if you are insistent and you wanna buy 9 Prism plot, go ahead its not a bad investment at all. Just make sure that you buy a plot which is not worth more than 110 Lacs including development charges in a reasonablly good location.
When we say do not invest in some area, it does not mean its a bad place or phase, it just means there are other more lucrative opportunities in the same area which may be more safer and give you more value for your money. We draw comparisions for you and advise you to make a better choice. DHA Lahore is the best place you can invest in Lahore, no matter which phase you are talking about, you will make a lot of money where ever you invest in DHA right now.
Investment Consultant and CEO at Imlaak
Mob : +92 333 1717170 ( Whatsapp)
Skype : Shahnawaz.yaqub