KARACHI: The property investors are switching their investments to other countries after the government announced the revaluation of properties throughout the country, an industry official said on Thursday.

“Property investors are reluctant to invest in Pakistan and their funds are being diverted to other countries, particularly Dubai and Malaysia,” Parvaiz Afindi, chairman of Real Estate Brokers Association (REBA) said.

Afindi said investment in the real estate sector has drastically declined. Recently, government revised the decades-old collector rates of properties in several cities, which means the property buyers and sellers are now required to pay withholding tax on revised rates.

Property investors and traders are also required to pay capital gains tax, while the revenue body is also authorised to inquire about the source of investment. Afindi said around 20,000 persons are associated with real estate brokering business in the southern part of the city alone.

There are no estimates about the quantum of property trading business in the country, but according to the World Bank, in most of the countries, real estate, including land, accounts for between half and three-quarters of the national wealth.

The asset market size in Pakistan is around one trillion dollar, and the highest share of that is in real estate. “Investors have taken out their money from the property market due to uncertain situation and they are taking their money to other countries,” said the industry leader.

A delegation of the real estate brokers also called on Provincial Advisor Mola Buksh Chandio and informed him that even the property registrars were confused and they were still registering properties on collector rates.

Afindi said the advisor assured the delegation that the issues relating to the provincial government would be resolved while their recommendations would also be sent to the federal government.