How to sell property in Pakistan is a major concern for most people these days. Generally, property selling is quite easier as compared to property buying. Because property buying involves a long procedure and lots of tax paying. Moreover, due to more demands on properties these days, prices have gone up radically. Property sellers are getting more out of their residential or commercial properties.
The overall market trend is causing investors to buy properties because the market is witnessing steady growth in the future. However, for the property sellers, selling their property at the right rates to the right buyers is a problem. The flooding of the real estate market with unauthorized and fake agents, wrong token deposits, and many other factors have created an air of distrust for both sellers and buyers.
Therefore, it is a must to consider many factors before buying or selling any property in Pakistan. Following is a complete guide on how to sell property in Pakistan.
A Complete Guide on How to sell property in Pakistan
The availability of more and more online platforms for real estate businesses has helped people in selling, buying, or renting properties. However, the risk has multiplied because of the unreliability of the property listings. Following are some of the primary steps that each property seller must keep in check before selling their property:
- Researching and Finding a Reliable Property Agent
- Preparing & showcase the property
- Commission of the Agent
- Token Money
- Initial Deposit
- No-Demand Certificate
- Taxes and Documentation
- Transfer Letter
Researching and Finding a Reliable Property Agent
The first step in selling your property is to research the real estate market and property prices in the vicinity of your liking. If you list your property without any proper research, the real estate agents might take undue advantage. So, it is a prerequisite to research the market and then determine the rates of your property.
Detailed research will help you in the second step, which is finding the right real estate or property agent. When you are aware of the market trends and the real estate firms working in the field, you can easily find a reliable agent that can help you sell your property at the best rates.
Usually, the fake real estate agents make a deal with the buyers, take commissions, and help them buy the properties at lower rates when in fact they are involved in fraudulent activity and keep their customers in the dark. So, the factor of a reliable property agent is most important. A good real estate agent will help you at each step with honesty and authenticity.
Preparing the Property for Sale
After finding the right real estate agent, he will guide you in setting your property in the right ways for selling. If you sell any property in a bad condition, it will cause you a loss. However, properties with good conditions help the sellers in demanding more money. So, prepare your property before selling it.
Commission of the Agent
Property agents work on commissions, which is between 1%-2% of the total deal amount depending on the price. If you are working with any property agent, make sure that all parties concerned are clear about the commission. Mostly, the commission amount is paid to the agent in the end; however, in some cases, if the buyer pays a certain amount in advance, then a part of it is paid to the agent in advance too.
Token money is a small amount that the buyer gives to the seller when he wants to seal the deal. It is a type of confirmation money that the buyer has now officially made some type of commitment. In return for the token money, the seller has to produce original documents of the property to the buyer.
The buyer then verifies the documents from the land development authority for the property’s location and authenticity. So, token money is officially a word between the seller and the buyer where both make confirmations each at their end.
An initial deposit is the first official payment that is made between both parties. It is officially known as “bayana”, which is 25% of the selling price. It is the time when a contract or stamp paper is signed. A paper containing the mutual condition from both sides helps to seal the deal officially.
The stamp paper officially clarifies the period that the buyer will take to clarify the remaining payments. Bayana is an important step in property selling and buying in Pakistan.
NDC or no-demand certificate is the paper that certifies that the seller does not owe any money to the buyer. This paper enlists the taxes and bayana exclusively. Any property transfer in Pakistan is almost impossible without NDC. The paper is issued by the private housing society or the land development authority based on the location of the plot.
Taxes and Documentation
Even though selling a property is easy, it is a very lengthy one. After a proper deal, the seller and the buyer both have to clarify the taxes. Property taxes in Pakistan vary depending upon the location and type of the plot. Capital Gain Tax (CGT) is the major tax, which is 1% for the filers and 2% for the non-filers.
The taxes are paid to the office of the private housing authority or the land development authority. Additionally, the buyer and seller both have to pay several other taxes as well before handing over the full payments and property authority letters to each other.
The most important documents for which all the deals and processes take place. The paper is an official declaration that a certain property has been transferred to another owner giving them the right to start construction, demolish, revamp or resell.
For more details and consultancy, Hashi GOC is providing all services to its clients. Hash Real Estate and Builders is a firm under Hashi GOC that has teams for property advisory and consultancy. You can visit us at the office or contact us at: