LAHORE, Dec 25: Big investors have 'monopolized' the sale and purchase of property in the Defence Housing Authority of the Punjab capital.

These investors purchase plots in bulk at a rate higher than the market's, continue land transactions among themselves for a month or so, and earn between Rs500,000 and Rs1,000,000 for each plot.

The entire phase VIII of the DHA is said by real estate agents to have been purchased by big investors.

At present, no one-kanal plot is available for less than Rs7 million in the first four phases of the authority while some prime location 10-marla plots cost over Rs10 million, leaving no room for 'genuine' buyers or investors having no holding power.

Construction in four of the 10 phases of the DHA is almost complete. Possession of plots is being given in phase V where many owners have started construction, 'balloting' in phase VI is under way while the rest of the phases are in the 'file' stage.

'Balloting' is the allotment process of the plot number while a 'file' describes that the holder owns a property of a certain measurement but has no mention of the location of the tract.

Every phase of the DHA has more than 3,000 plots of one and two kanal while some are of five or 10 marla. The phase VI has over 8,000 plots, mostly of one kanal.

People prefer to invest in the DHA because of its transparent sale and purchase system, which minimizes risk of fraud and ensures measurement of the area of the plot as mentioned in the file.

On an average some 30 to 50 plots are transferred daily at the DHA office where no token is issued after 9am for entry. A one-kanal plot transfer costs a buyer over Rs100,000 - a sum of Rs75,000 as transfer fee and Rs21,000 as DHA membership fee.

The price increase in the DHA has also increased the value of adjoining localities.

The real estate prices there started increasing two-and-a-half years ago when the completion certificate condition was waived. Earlier, a buyer was required to construct a house and get completion certificate from the DHA within a stipulated period.

The waiver resulted in mushroom growth of real estate or property agencies in and around the authority and increase in prices by 100-200 per cent. At present, retired or serving army officers have a stake in most of the 1,500 or so such agencies.

Every agency gives Rs5,000 worth classified advertisements in newspapers daily on the average. The amount goes up to Rs15,000 on Sundays and public holidays.

The greater inflow of home remittances through banking channels after imposition of curbs on hundi and hawala transfers by the US and Arab states following the fateful events of 9/11 is stated to be the main factor for the price hike in the real estate.

Low profit rates by the banks and national saving schemes, uncertain conditions at the stock market, entry of big investors in the market under the patronage of some senior army officers, bureaucrats and politicians, are the other contributing factors.

High cost of utilities and inputs, multiple taxation and flooding of markets by cheaper Chinese products forced industrialists to jump into the arena.