Why Bangladesh’s Real Estate Market Has Stalled

Bangladesh’s housing market is in its worst stretch in years. Apartment sales have fallen by a third or more since 2024, luxury sales by up to 70%, and bad loans in the real estate sector have more than tripled. Developers are sitting on unsold flats, buyers are cancelling bookings, and the steel and cement factories that feed the industry are running below capacity. Here is what went wrong, who is being hurt, and what it means for you if you want to buy, sell or hold property now.

A booking, and then a long pause

In early 2024, Kamal, a mid-level bank officer, booked a 1,250 sq ft flat in an under-construction building in Mirpur. The price was about Tk 1 crore. He paid the booking money and planned to take a home loan for 70% of the rest when the building was finished.

Two years later, the building is still a concrete frame. The developer says sales have dried up and construction costs have jumped. The home loan rate Kamal was quoted has risen by several percentage points. Some of his neighbours in the project have cancelled their bookings and asked for refunds.

“I don’t know whether to keep paying, cancel, or wait,” he says. Thousands of buyers across Dhaka are asking the same question.

How bad is it?

Indicator	What the reports say	Source
Overall apartment sales	Down 30% to 35% in 2024 compared with 2023, and worse in 2025	The Business Standard, April 2026
Industry monthly sales	Down to about 700 to 750 units from about 1,000	The Daily Star
Mid-range flats (Tk 1 crore to Tk 2 crore)	Down 40% to 50% compared with FY23, at one major developer	The Daily Star, December 2025
Luxury flats in Gulshan, Banani, Dhanmondi	Down 60% to 70%	The Daily Star
Booking cancellations	About 25% of bookings cancelled since August 2024 at one large developer	The Business Standard, April 2026
Bad loans in real estate	About 26.7% in 2025, up from about 8% in 2022	Bangladesh Bank data, via The Business Standard
Prices	Expected 5% to 8% yearly growth has stalled; some projects down 5% to 10%	The Daily Star

Behind the averages, the pain is uneven. Developers told The Business Standard that monthly sales at many firms have fallen from 5 to 8 units to just 1 or 2. One developer said it had about 200 unsold apartments across 30 Dhaka projects. “Only those with urgent needs are buying now,” another said.

Five reasons the market stalled

1. Home loans became expensive

Most middle-class buyers borrow about 70% of a flat’s price. In January 2022, home loan rates were capped at 9%. After the cap was lifted, rates climbed as high as 17% in early 2024 and stayed in the 14% to 16% range for many borrowers, The Daily Star reported.

Here is what that does to a Tk 70 lakh loan over 20 years (our calculation):

Interest rate	Monthly EMI
9%	About Tk 63,000
12%	About Tk 77,100
15%	About Tk 92,200

Going from 9% to 15% adds almost Tk 29,000 a month. For a family earning Tk 1.5 lakh, that is the difference between a stretch and impossible. Existing borrowers on adjustable rates were hit too: a member of our own team saw a home loan rate rise from 9.9% to 13.85% within a year, as we described in our DBH home loan review.

2. Political change froze big buyers

After the political transition of August 2024, many wealthy buyers, including business people and political figures, left the country or kept a low profile. The government also ended the option to legalise undeclared money by investing it in property, which had supported high-end sales. That is why luxury sales fell the furthest. Developers say many investors are still waiting to see how policy settles. “The market is likely to remain stagnant until uncertainty over national-level decisions is resolved,” a REHAB leader told The Daily Star.

3. Building costs jumped

Developers say construction costs have risen about 25%. Rod prices went from under Tk 80,000 to Tk 1.05 lakh to Tk 1.08 lakh a tonne, and cement from Tk 480 to Tk 520 a bag to Tk 520 to Tk 550, The Business Standard reported, blaming global conflicts, a weaker taka and higher fuel costs. A flat that cost more to build cannot easily be sold for less.

4. The DAP shrank what can be built

Dhaka’s Detailed Area Plan (DAP 2022 to 2035) cut permitted building heights and floor area ratios in many areas. On the same plot, a developer can now build fewer flats, so land costs are spread over fewer units and each flat costs more. Developers say this has slowed new projects and is part of the 25% cost rise.

5. Ordinary families were priced out

Even before the slump, flats were moving out of reach. In the early 2000s, a mid-level professional needed 7 to 10 years of income to buy a modest flat; today it takes 25 to 30 years, The Business Standard reported in February 2026. A two-bedroom flat in a less-serviced area like Bosila costs about Tk 40 lakh, with a down payment of at least Tk 15 lakh, which is out of reach for families earning Tk 30,000 to Tk 50,000 a month.

Who else is hurting

Real estate contributes about 8% of GDP and supports an estimated 3.5 million jobs, with links to more than 250 industries, The Business Standard reported. When flats stop selling, the damage spreads:

• Steel: monthly rod consumption fell from about 6.5 lakh tonnes to 4 lakh tonnes after the political upheaval, the steel makers’ association said in 2025, and manufacturers reported heavy losses.
• Cement: nearly 90% of cement factories were operating below capacity or had paused production, according to the April 2026 report.
• Banks: real estate bad loans reached about 26.7% in 2025, as developers struggled to repay.
• Workers: construction labourers, electricians, tile and paint suppliers, and furniture makers all depend on new buildings.

REHAB, the developers’ association, has asked Bangladesh Bank for a Tk 3,000 crore special fund to help members finish ongoing projects, and has asked the government to cut the taxes and fees on flat registration, including lower gain tax, stamp duty and VAT, The Financial Express reported. The revenue board has rejected bringing back the undisclosed-money option.

When buyers lost their money: real cases

A slow market raises the risk that a developer runs out of money before a building is finished. Bangladesh has a long record of buyers who paid in full and were left with no flat, no refund, or years in court. These cases, all reported by national newspapers, show what can go wrong. Some involve allegations or claims that have not been proven in court, and we say so where that applies.

Case 1: Dom-Inno, 2,000 flats never delivered

Dom-Inno Properties was once one of the country’s larger developers, with about 254 completed projects. But buyers have paid for about 2,000 apartments, worth more than Tk 3,000 crore, that remain unfinished, The Business Standard reported in September 2025. REHAB received complaints about 142 of its projects over 15 years, and the company and its managing director face about 250 cases, including fraud, cheque bouncing and money laundering. The Anti-Corruption Commission alleges that buyers’ money was diverted to other businesses; these allegations have not been proven in court.

Behind the numbers are people like Nazmul Haque, who paid Tk 80 lakh for an Armanitola flat about 18 years ago and has received neither the flat nor a refund, and Mahmudul Hasan, who bought a flat in 2008 with a Tk 70 lakh bank loan and now faces legal trouble over the loan for a flat he never got. “My life has been consumed by court battles,” Nazmul told the paper. In a Nayapaltan project, more than 70 buyers reportedly paid about Tk 1 crore each. The company told TBS it is “working towards solutions”.

Case 2: one flat sold to several buyers

Buyers of Sumona Landmark projects told a press conference that 51 of them had been cheated of about Tk 15 crore, The Daily Star reported. They said the developer sold the same flats to several people: three apartments in one Uttara project were allegedly sold to 16 buyers. Each had paid Tk 25 lakh to Tk 50 lakh, and construction had stalled at all seven projects. These were the victims’ claims; the company did not respond to the paper.

Case 3: paid in full in 2012, still waiting

Jalal Ahmed, a motor parts importer, paid Tk 76 lakh in full by July 2012 for a 1,200 sq ft flat in Kalachandpur, Dhaka, with handover promised that September. The building was finished in 2015, but he has still not got possession, The Business Standard reported in December 2025. An arbitration tribunal recommended immediate handover, but the developer objected and the case dragged on. Jalal says he has been to court more than 60 times and spent over Tk 8 lakh on legal costs. The developer says the matter is before the court.

Case 4: the bank came for the building

Aminul Islam Talukder paid about Tk 60 lakh for a flat in an Uttara project. Without buyers knowing, the developer’s managing director took a loan of about Tk 7 crore from a bank against the building’s flats. When the loan was not repaid, the bank won the right to auction the building, The Business Standard reported. He had to go to the High Court to stop the auction and get possession, and still had no official papers. At the time, about 1,100 bank cases against developers, worth more than Tk 2,000 crore, were pending in Dhaka’s money loan courts.

Why buyers struggle to get their money back

Under the Real Estate Development and Management Act 2010, disputes between buyers and developers go to arbitration rather than ordinary courts. Arbitration has no deadlines and weak enforcement, and developers can challenge awards. As of October 2025, 24,403 arbitration cases worth about Tk 19,630 crore were pending across the country, 17,308 of them in Dhaka, and more than 2,000 Dhaka cases had been waiting over 10 years, The Business Standard reported. Even a “win” can take most of a decade: one Azimpur buyer got his deed and flat in 2018, eight years after filing. The High Court has questioned whether forcing buyers into arbitration is lawful, but had not ruled at the time of that report.

The lessons

• A big name is not a guarantee. Dom-Inno had hundreds of completed projects before its troubles.
• Check that the flat is not already sold or mortgaged. Ask the developer in writing whether the building or land is mortgaged to a bank, and check with other buyers.
• Do not pay everything before you get the flat. Link payments to construction stages, and hold back a final share until handover and registration.
• Insist on registration. Possession without a registered deed leaves you exposed.
• Act early. If work stops, join other buyers and get legal advice quickly; delays only make recovery harder.

The bright spot: mid-range flats

Not every segment is equally weak. Flats of around 1,200 sq ft priced between Tk 1 crore and Tk 2 crore are what is keeping many developers going, because salaried buyers with real housing needs still buy, even if more slowly, The Daily Star reported. Developers are shifting new projects toward smaller, mid-priced units, and the home loan ceiling has been raised to Tk 4 crore.

Is now a good time to buy?

A slow market can be a buyer’s market, but it carries real risks. Weigh both sides.

Why it can be a good time

• Bargaining power: with few buyers, developers are more willing to cut prices, offer flexible instalments, or add parking and fittings.
• Ready flats: developers with finished but unsold units are especially keen to sell. Buying a completed flat removes construction risk.
• Prices are not racing ahead: with growth stalled and some projects falling, there is less pressure to rush.

Why caution is needed

• Developer risk: with sales down and bad loans up, some developers may not finish projects on time, or at all. Booking an under-construction flat from a weak developer is the biggest risk in this market.
• Loan costs: rates are still high, and adjustable rates can rise again.
• Resale is slow: if you may need to sell within a few years, finding a buyer could take a long time.

A checklist for buyers now

1. Prefer ready or nearly finished flats over projects that are still at the foundation stage.
2. Check the developer: REHAB membership, years in business, completed projects you can visit, and whether past buyers got their flats on time.
3. Check the land papers and RAJUK approval, and confirm the approved plan matches what is being built under the DAP.
4. Ask for the refund and cancellation terms in writing before paying any booking money.
5. Ask in writing whether the land or building is mortgaged to a bank, and whether your flat has been offered to anyone else.
6. Negotiate: ask for a discount, a longer instalment plan, or included extras.
7. Stress-test your loan: could you still pay if the rate rose 3 to 4 percentage points? Consider a fixed rate if offered.
8. Budget for registration costs, which add a significant share on top of the price.
9. Pay large amounts by bank transfer (such as RTGS), never in cash, and keep every receipt.

If you have already booked a flat

• Visit the site regularly and compare progress with the schedule in your agreement.
• Read your agreement’s delay and cancellation clauses before deciding anything. Cancelling may mean a deduction from your refund, and refunds can be slow when a developer is short of cash.
• Talk to other buyers in the project. A group of buyers has more weight with a developer than one person.
• Keep paying only if the project is moving. If work has stopped for months, get legal advice before paying further instalments.

What could turn the market around

Developers and analysts point to the same few triggers: lower interest rates, a clear and stable policy environment after the political transition, a revised or eased DAP, and cheaper registration. Without lower borrowing costs, the middle-class buyers who make up the core of the market will stay cautious. Until then, the market is likely to stay slow, with modest, mid-range flats faring best.

Back to Kamal

Kamal joined a group of buyers in his project. Together they met the developer, asked for a written construction schedule and agreed to keep paying only as each floor was finished. He also asked his bank about a fixed-rate loan. “I can’t control the market,” he says. “But I can control how much risk I take.”

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This article is for general information only and is not financial or legal advice. Property decisions are large and personal. Check documents carefully and get professional advice before you commit.

Frequently asked questions

Why is the real estate market down in Bangladesh?

High home loan rates, political and economic uncertainty since August 2024, a roughly 25% rise in construction costs, stricter building limits under Dhaka’s DAP, and the end of the option to invest undeclared money in property.

How much have flat sales fallen?

Overall sales fell 30% to 35% in 2024 and weakened further in 2025. Mid-range sales are down 40% to 50% at some developers, and luxury sales by 60% to 70%.

Are flat prices falling in Dhaka?

Mostly, prices have stopped rising rather than fallen sharply. Some projects have seen prices drop 5% to 10%, and buyers can often negotiate discounts or better payment terms.

Is it a good time to buy a flat?

It can be, if you buy a ready flat from a reliable developer, negotiate hard and can afford the loan even if rates rise. Under-construction projects from weak developers carry more risk than usual.

What should I do if my project has stalled?

Read your agreement, visit the site, organise with other buyers, ask the developer for a written schedule, and get legal advice before paying further instalments on a stopped project.

Can I sue a developer who does not hand over my flat?

Under the Real Estate Development and Management Act 2010, buyer-developer disputes go to arbitration through the district judge’s court. It can take many years, with more than 24,000 cases pending nationwide as of October 2025. Get legal advice early, and act together with other buyers where possible.

Key words explained

Term	What it means
REHAB	Real Estate and Housing Association of Bangladesh, the developers’ trade body.
DAP	Detailed Area Plan: Dhaka’s land use and building plan for 2022 to 2035.
FAR	Floor area ratio: how much floor space can be built on a plot.
RAJUK	The Capital Development Authority, which approves building plans in Dhaka.
Booking money	The first payment that reserves a flat in a project.
Default loan	A bank loan the borrower has stopped repaying on schedule.
EMI	Equated monthly instalment on a loan.
Arbitration	A process where a tribunal, not an ordinary court, decides a dispute; the route for buyer-developer disputes under the 2010 real estate law.

How we reported this

We used reporting from The Business Standard (April 2026 on sales, cancellations, costs and bad loans; February 2026 on affordability), The Daily Star (December 2025 and early 2026 on segment sales, home loan rates and prices), The Financial Express (April 2026 on REHAB’s tax demands) and Daily Industry (August 2025 on steel demand). The buyer case studies come from The Business Standard (September 2025, December 2025 and January 2021) and The Daily Star; claims by buyers and allegations by authorities are reported as such and have not all been tested in court. Figures from developers are their own estimates and vary by company. The EMI examples are our own calculations. Kamal is illustrative, not a real person.

Editor’s note: Kamal and his family are illustrative, created to show how the slowdown affects an ordinary buyer. They are not real people. All market figures come from the published sources linked in this article.