Relationship between Economic Condition, Credit Risk and Loan Maturity to Property Values with Mediating Role of Interest Rate in Quetta

Abstract

This research work aims at examining the dynamic forces that shape the real estate market in Quetta with special emphasis on the effect of interest rate changes as determined by national and global economic and political environments on the prices of properties and investors’ behavior. The case of Quetta’s market is particularly sensitive because of its strategic location and its role as a refugee city, which makes population and economic changes more noticeable and profound. Based on the quantitative method of data analysis, this work aims to investigate the economic conditions, credit risk, loan maturity, and real estate prices in the past decade using interest rates as the moderating variable. The study establishes that change in interest rates plays a major role in the price of real estate, and therefore the level of demand and supply. This paper demonstrate the importance of adaptive economic strategies and sound urban development to sustain a healthy real estate market in Quetta. Thus, with the help of the data regarding financial indicators and market analysis, this work presents a helpful vision for policymakers, investors, and other financial institutions that can help them manage the challenges of the emerging real estate markets in the politically and economically unstable areas. It is not only useful in enhancing the knowledge on how markets respond to macroeconomic policies but also offers a framework of creating real estate markets that are less prone to economic and political volatilities.