Pakistan’s residential property market continues to expand rapidly, posting double-digit price growth. In February 2026, the residential property price index for houses in Karachi, Pakistan’s largest and most urbanized city and historically the country’s leading real estate market, surged by a huge 20.44% year-on-year (14.05% in inflation-adjusted terms), according to data from the property portal Zameen.
On the other hand, the index for apartments recorded a more moderate increase of 8.87% (3.10% inflation-adjusted).
Though residential property price trends differ across the country’s major cities and property types.
In Pakistan’s other major cities, as of February 2026:
- In Islamabad, the house price index increased slightly by 1.92% (but declined by 3.49% in real terms. Apartments, on the other hand, saw strong price growth of 15.38% (9.27% inflation-adjusted).
- In Lahore, the price index for houses fell by 7.05% y-o-y (-11.98% inflation-adjusted) while the apartment index increased by 6.16% (0.53% inflation-adjusted).
- In Rawalpindi, the house price index dropped -16.73% y-o-y (-21.15% inflation-adjusted) while apartments experienced a more moderate price fall of 5.38% (-10.4% inflation-adjusted).
- In Faisalabad, house prices were up by 6.09% (0.47% inflation-adjusted) y-o-y in February 2026. Likewise, apartment prices also increased by 4.86% (fell slightly by 0.7% in inflation-adjusted terms).
- In Gujranwala, house prices increased by an average of 9.9% y-o-y (4.07% inflation-adjusted) in February 2026.
- In Multan, the house price index rose by 9.16% y-o-y (3.37% inflation-adjusted) while the apartment index soared by 25.17% (18.53% inflation-adjusted).
In the housing segment, Islamabad recorded the highest average house price in Pakistan at PKR 83.6 million (US$299,949) in February 2026, based on figures from Zameen. This was followed by Karachi, where the average house price stood at PKR 77.7 million (US$278,780), and Lahore, with an average of PKR 52.1 million (US$186,930).
In the apartment segment, Karachi posted the highest average price in February 2026 at PKR 27.0 million (US$96,873), followed by Islamabad at PKR 25.5 million (US$91,491) and Lahore at PKR 23.8 million (US$85,392).
Residential property demand in Pakistan’s major cities remains strong through 2025 and early 2026, driven by population growth, urbanization, and rising household formation. Karachi, Lahore, and Islamabad continue to see active interest in apartments, villas, and gated community homes, while secondary cities like Rawalpindi and Gujranwala are also attracting buyers due to improved infrastructure and services.
Investor activity further supports property demand, with local investors and overseas Pakistanis seeking long-term capital appreciation. Despite affordability challenges for some buyers, structural demand for residential real estate in urban centers remains resilient and expanding, signaling continued growth in Pakistan’s property market.
Though Pakistan’s economy continues to face volatility after years of macroeconomic instability. The International Monetary Fund (IMF) estimates GDP growth at around 2.7% in 2025, constrained by weak investment, tight fiscal policy, and fragile domestic demand. This marks only a slight improvement from previous years, when the economy grappled with high inflation, external imbalances, and financing pressures. Growth has been uneven in recent years: 2.5% in 2024, a contraction of 0.2% in 2023, strong rebounds of 6.2% in 2022 and 5.8% in 2021, following a pandemic-related decline of 0.9% in 2020.
The IMF expects Pakistan’s economy to grow by a moderate 3.2% this year. This is a bit higher than the World Bank‘s forecast of a 3% expansion.
