When making long-term investments or developing assets, property purchase is among the top priorities of many people simply because it is a hard asset that is often resistant to small economic turbulences and that can undergo value appreciation with time.

However, property purchase is not a piece of cake due to the large budgets that are required. So what can a simple middle-income person do to obtain such a valuable asset? The answer to this is installment plans, where the price of the property is divided into small payments over a period of time instead of a single large payment. 

This article will guide you through the basic steps on how to buy property on installments in Pakistan, with a detailed discussion of the main points to be considered in the process. 

Steps to Buy a Property on Installments in Pakistan

When buying any property, it is a common understanding to go through the market and finalize your requirements, after which the verification and contract details can be handled. Some important steps include:

1. Determining property goals
2. Performing market research
3. Checking Legal Status
4. Installment Plan

1- Determining Property Goals

The very first step is to shape out what type of property you want. In doing so, the following points should be considered:

• The location: Do you need property in the city center or in the suburbs? Is the property you need accessible through main road networks?
• The facilities: Does the property have an adequate supply of basic utilities such as electricity, gas, and water? Is it secure? Are educational, healthcare and commercial facilities available nearby? And at what distance? 
• Building features: If looking for an apartment, you need to determine if the building is stable. Is security efficient? Does it have any central systems and check for their quality, etc?

Considering all these factors when finalizing your property will allow you to shape out your budget and weigh out a payment plan in addition to making an informed decision. 

2- Performing Market Research

Once you are clear about what you need, you can analyze the property market to understand current trends and prices. Knowing the price ranges of properties will allow you to assess the value of the properties compared to the one you are interested in. This will prevent spending on any overpriced property. Most developers and banks provide installment plans. These can be compared to your budget for making an informed and better decision.  

3- Determining the Legality of Property

Before moving towards any agreement or payment decision, you need to check if the project of which the property is a part, or if the property itself, is not legally objectionable. Here, it is important to check if the project or if you are buying a home, the housing society is NOC approved by the relevant development authority. For individual properties, paperwork should be available, such as the Fard or Registry. 

For properties in Rawalpindi and Islamabad, you can go for RDA or CDA approved Housing Societies in Rawalpindi and Islamabad i.e. Saffron City. To be on the safe side, you can cross-check with the list of illegal housing societies of Islamabad.

4- Installment Plan

Most projects require their customers to submit an initial payment, after which the remaining payment is given through a number of payment episodes over a certain time period. The time duration, amount per installment, and number of installments vary with each developer or owner. In most cases, installments are paid for a period of 1 year to 5 years. 

Down Payment: In many cases, the down payment, which is submitted to book the property, is about 10-15% of the total price of the property. This payment is necessary to reserve the property for you from the rest of the market and gives a signal to the seller about your financial standing. 

Installment duration: The total period for which the installments are to be paid depends on the installment amount and the number of installments. If the amount is greater for each installment, the number and duration are less. But if the amount is smaller, the duration and number of installments are longer

Balloon Payments: These are the slightly larger payments than regular installments, which are often paid in the middle of the installment duration or at the end. Some societies recover balloon payments periodically, such as biannually or annually. Some take these payments upon balloting, while some take them at the end during possession. 

Tips For Buying Property On Installments

• Consult a real estate specialist for a better decision. Safra Developers is providing professional services and can guide in this matter. 
• Make site visits before making decisions
• Document every process
• Be punctual in installment payments to avoid penalties. 
• Be up-to-date with balloting, possession dates, and other milestones. 

Buying a property on installments in Pakistan can be a difficult process if not well aware of the process. Knowing your property goals, researching market trends to compare properties for better decisions, and checking if the property meets all legal requirements before agreeing on an installment plan are necessary to reduce losses and maximize benefits from the purchase.