House Leasing in Pakistan – How does it Work?

House Leasing in Pakistan

With the passage of time, the lifestyle of people around the world experienced different transitions driven and influenced by varying trends. Yet, the basic necessities have remained the same, and housing is one of them. The necessity of shelter is amongst the foremost priorities in the need hierarchy of people. But unfortunately, due to rising prices, buying a house of your own has become hard as ever. 

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Since the last decade, like many countries around the world, the real estate sector of Pakistan has also witnessed an upward trend. As a result, the rates of property in nearly all cities have skyrocketed exceeding the affordability range of most people, especially the middle class. 


However, in this world of growing complexities, there are some alternatives that may be opted. Likewise, when it comes to housing, renting and leasing are two of the options that allow people to stay in a house of their choice without having to make a purchase.

What does it mean to lease a house?

A lease is a contractual binding between a tenant and a property owner that authorizes a tenant to live in a property owned by another person, for a fixed period of time. Likewise, in a house lease, the house owner allows a tenant to stay in his property for a certain duration as specified and agreed in the lease agreement. 


The lease agreement can be renewed upon the end of the agreed duration. Moreover, leasing is not limited to housing, it can also be practised for the following:


  • Apartments
  • Land
  • Furniture
  • Vehicles
  • Commercial Property

Constituents of Lease

There are a number of key indicators that specify a lease agreement. Some of these, as stated in the provisions of Section 106 of Transfer of Property Act, 1882, are mentioned below:


  • Transfer of right to make use of the immovable property
  • The time period of this right to property usage must be fixed
  • The terms must be clear and pre-defined
  • The transfer must be acknowledged by the transferee; and
  • It must be for consideration either if it is premium or rent, or both

How does it work?

Leasing is a binding contract that serves as a legal document between the tenant and a property owner. It is a common form of property agreement in most of Europe and the United States, as well as the rest of the world. 


In leasing, both parties (the tenant and the property owner) agree to abide by the terms agreed in the contract. Violation from any of the signatories can lead to legal consequences in the court of law. 

What is the difference between a lease and rent?

To a layman, both a lease and rent might sound the same. But in reality, both of these practices have fundamental differences. The most evident and differentiating distinction between a lease and rent is their time duration. While a lease remains valid for as long as the period specified in the lease agreement, the rental agreement covers a short period of time that is not necessarily stated. 


Moreover, the lease agreement leaves the tenant with an option to buy the property after the completion of the predetermined lease period. However, a rental agreement does not allow or require the tenant to purchase the property. 

House leasing in Pakistan

Due to rising inflation and escalating property prices, the trend of leasing is on a rise in Pakistan. People are now either forced or tempted to opt for lease options to find and acquire a suitable place for living. Likewise, the country has witnessed a significant surge in the number of tenant-held houses over the past 5 years, according to reliable statistical sources. If you are one of those who are searching for a house rental lease in Pakistan, then you need to visit portal to find the right option. 


Finding a house on a rental lease is nowadays easier than ever before. There are several ways to find a lease house for sale in Karachi, Lahore, Rawalpindi, or any other city. But if you are looking to acquire an authenticated and reliable house on lease in Rawalpindi or other major cities of Pakistan, then you must consider searching through’s official web portal to increase self-awareness about how house leasing works in Pakistan, and what options might there be at your disposal. 

How to lease a house in Pakistan – Explained

A house rental lease provides tenants with a “sense of security” of “living in a home” of their own, along with the luxury of not spending a huge upfront amount on its purchase.


To lease a house in Pakistan, an applicant needs to pass through a screening process (including some verifications) and meet certain pre-determined standards to be declared eligible for financial assistance in this regard. 


Eligibility Criteria

The government of Pakistan has set various laws for lease agreements focused on buying a house on leased land. These laws include certain conditions that apply principally to the person acquiring the lease. The conditions are as follows:



The applicant must be 18 years of age. The maximum age limit of the applicant is 60 years. However, for self-employed individuals, there is a five-year relaxation in the upper age limit. 


The applicant must be employed and should have enough income to meet the investment obligation. To verify and authenticate this fact, the applicant is required to provide proof of his income, in the form of salary slips or tax returns. 


If the lease is being acquired for a house or an apartment then they must not be more than 45 years old. Moreover, the existing owner should have a clear title (unrestricted, unconditional, and absolute ownership) to the property.


The lease plan in Pakistan can be obtained for a period of three to twenty years, depending on the income of the applicant.

Down payment

Upon successfully acquiring a lease, the applicant is entitled to make a down payment of 30% on the actual value of the property. 


The worth of the property is divided into monthly payments. As soon as the complete liable amount has been paid as a result of monthly payments, the applicant becomes the sole owner of the property and the title is transferred to his name.



Various banks and financial institutions in Pakistan offer leasing plans for immovable property (including houses and apartments) as well as other tangible commodities. If you are considering signing a lease agreement with a bank, you must closely peruse and review the conditions and terms of the contract before signing it because some banks shackle the applicants in strict obligations. 

Recent Trends

In Pakistan, there is a growing trend of house leasing purposefully driven by the ruling government itself. “Naya Pakistan Housing Scheme” is a federally-run initiative introduced as an outright solution to housing for the lower and middle class that cannot afford to buy a house due to limited income. 


This is a visionary initiative that has increased the trend of house leasing in Pakistan. Assisted by the supportive government policies on housing, more people are now able to acquire interest-free loans to construct or lease a house of their own. 

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1 thought on “House Leasing in Pakistan – How does it Work?”

  1. Residential properties are one of the most important types of real estate for investment purposes. It is the best starting point for ambitious real estate investors, as it has lower entry costs and may be easier to acquire financing than commercial real estate.
    It contains housing for individuals, families, or groups of people. Most people are familiar with residential real estate as it is a basic need of humans as well as the most common type of estate and the asset class. It includes any property that is used for accommodation purposes, such as single-family homes, apartments, condominiums, townhouses, and other types of living arrangements.
    Residential property has become a more accessible investment option to the people as it can be purchased on a reasonable down payment.

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