ISLAMABAD: According to the Federal Board of Revenue (FBR), the recent adjustment of real estate valuation rates in selected areas of some major urban centers of the country is aimed at providing a level playing field to all and is likely to boost revenue collection and promote healthy growth of the real estate sector in the long run.
The adjustment of property valuation rates has been carried out in only a small number of localities in six large cities. Among these areas and localities where the valuation rates have been adjusted include only one locality (Hayatabad) out of 335 residential localities in Peshawar, one locality (Eden Orchids) out of 395 localities of Faisalabad, six localities namely Gujarpura, Anmol Cooperative Housing Society, Attari Saroba, Balhar, Dev Khurd Kalan and EME Society in the entire 1,234 localities of Lahore and three sectors of I-15, I-16 and E-12 in the 64 localities of the federal capital. Similarly, only three out of 195 localities in Karachi and only two localities in Rawalpindi have been adjusted because of certain anomalies in the previous valuation rates.
The FBR rates have been revised after several representations made by various Real Estate Agents Associations regarding the negative impacts of the previous FBR notified rates. The rates in certain cases were in excess of the true market rates and in few cases reached up to 70 to 80 per cent of the market rates.
These anomalies led to stagnation in the real estate activity, crippling real estate business in the market.
This rationalization and revision of rates in certain localities, to remove anomalies, is not only aimed at boosting the market but also to have a positive impact on the growth of revenue from the real estate business in the aforementioned areas wherein it had reduced to a standstill due to a lack of interest and a sharp decline in real estate investments.
The FBR rates are also likely to be revised upward in the next budget following consultations and input from all the stakeholders.