House rents in the twin-cities of Islamabad and Rawalpindi have increased by more than 20 percent during the last six months, adding further to the woes of inflation-hit city dwellers.
According to an anecdotal survey conducted by APP, house rent in Islamabad city, Rawalpindi Cantt, Chaklala Cantt, Satellite Town and newly established housing schemes in Islamabad has increased by more than 20 percent.
Similarly, Ghauri Town, PWD, Media Town, Soan Garden, Jinnah Garden, Bahria Town, Gulzar-i-Quaid, Chak Shehzad, Chatha Bakhtawar, Shehzad Town, Margalla Town, Bhara Kahu, Khayaban-e-Sir Syed, British Homes, and Gulraiz 1&2 witnessed a surge in house rent prices by 20 percent.
According to the Inflation Monitor Report issued by the State Bank of Pakistan (SBP) for February 2022, house rent topped the list of contributions to the urban Consumer Price Index (CPI) as it weighted 19.26 during the last month of the current fiscal year.
The report revealed that house rent prices soared in 2022 by 6.13% from 4.77% a year ago, reaching the second spot in the list of 10 weighted contributions to the urban CPI in February 2022.
Real estate agent Ahsan Khan said: “Previously, the rent prices used to surge in winter due to the arrival of people from neighboring hilly areas and drop down in summer when these people leave after spending the days of harsh winter in the twin-cities.” However, he added, from the last two year, the prices never dropped even in the summer.
“I got a housing unit on rent in Gulraiz-1 for a price of Rs18,000 per month in November 2021. When we decided to vacate the house, the owner signed a contract with a new dweller for renting out the same house at a price of Rs25,000 per month. I am afraid the rent prices will go further higher till the next winter,” informed a resident of Kashmir who, along with his family, spends every winter in Rawalpindi to avoid the odd weather conditions in the hilly area.
According to another report of the SBP, the urban housing demand is going up by 350,000 units every year, of which the demand is met for only 150,000 units. At the same time, prices of land and construction material have also been increasing manifold, making it more difficult for individuals, investors, and other stakeholders to fill this gap by constructing additional housing units.
“Increasing house rent prices indicates there is a visible gap between the demand and supply. The number of rural people settling down in the cities is way larger than the number of housing units built annually. The increasing rents mean that urban housing is now turning into a major crisis for those living and working in cities and majority of them don’t own a house,” said the owner of a private construction company in Islamabad.