Pakistan plans to lift mortgage finance to 5% of GDP by 2035
Pakistan's Planning Ministry has proposed raising mortgage finance to 5% of gross domestic product by 2035, from below 0.5% at present, and building 300,000 to 400,000 housing units a year under a new housing, construction and real estate reform framework. The proposals were presented by Member Planning Commission Waqas Anwar at a meeting of the eighth National Economic Mission under the Uraan Pakistan framework, chaired by Federal Minister for Planning, Development and Special Initiatives Ahsan Iqbal, the ministry said on Wednesday.
The presentation set out a digitalisation programme covering land records, permits, valuations and transfers by FY2029, alongside one-window construction approvals, incentives linked to verified construction milestones and secure escrow payments for property transactions, according to the ministry.
Addressing the meeting, which focused on promoting the housing, construction and real estate market, Iqbal said Pakistan must activate every sector of the economy to reach the vision of a $1 trillion economy. He described real estate and construction as the backbone of any economy, citing their links to multiple industries and their role in employment generation, and the presentation stated that construction supports 72 allied industries and accounts for approximately 9.5% of national employment. Iqbal said Pakistan faced a serious housing challenge, with population growth increasing demand while a large segment of the population remained without adequate housing.
Figures presented at the meeting showed Pakistan's urban population rising from approximately 76 million in 2017 to 94 million in 2023, with annual housing demand estimated at 700,000 units against supply of 250,000 units, an annual shortfall of roughly 450,000 homes. Built-up areas were reported to have grown between 2005 and 2022 by 104% in Islamabad, 59% in Lahore, 43% in Karachi, 44% in Peshawar and 72% in Quetta. The minister emphasised the need to promote vertical development and better use limited land resources while protecting agricultural land from unchecked horizontal expansion.
Iqbal also said Pakistan needed to modernise construction practices through new technologies, innovation and more efficient building methods. He pointed to the country's pool of skilled and technical human resources and to the record of Pakistani workers in the construction sector across the Middle East, but said Pakistani construction companies must build a strong international presence and compete in global markets. He stressed that the public and private sectors must work together, and that the construction sector should be developed not only to meet domestic requirements but as a source of exports, investment and foreign exchange earnings.
