Web Desk
Islamabad: Following the recent announcement by the SBP to reduce the policy rate to 12%, Tarek Hamdy, CEO of Eighteen Housing, has welcomed this decision, highlighting its potential to catalyze growth in the real estate sector.
The central bank’s policy rate, after being slashed by 1,000bps from 22% since June 2024 in six intervals, now stands at 12%.
Mr. Hamdy expressed optimism about the lowered policy rate, emphasizing its positive implications for stimulating active investments in real estate. “This decision will encourage individuals to move away from traditional banking practices of parking money in savings accounts towards actively investing in real estate,” noted Mr. Hamdy.
Highlighting the impact of previous policy rate hikes over the last two to three years, Mr. Hamdy pointed out that these increases had adversely affected business activity. “Higher policy rates led to a decline in investment interest, as people preferred safer options like savings accounts,”. This trend resulted in a slowdown in real estate transactions and overall economic activity.
With the policy rate now lowered, Mr. Hamdy anticipates resurgence in investor confidence and renewed interest in real estate as a viable investment option. As the lower rates will make borrowing costs more favorable, thereby encouraging both developers and homebuyers to participate actively in the market.
By easing financing costs, businesses will find it more viable to expand operations, create jobs, and spur economic growth. This cascading effect could lead to a robust and sustainable recovery for the economy.” CEO Eighteen further remarked.
