Sindh Government Lifts Ban on Commercial Use of Residential Plots

The Sindh Master Plan Authority has withdrawn a notification that had imposed an immediate ban on converting residential land for commercial purposes. This significant development potentially alters Karachi's long-standing issues with land use regulation and marks the beginning of a new regulatory phase for the city's property sector.

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The withdrawal of the notification does not amount to an automatic green light for commercialisation, as any change of land use remains subject to applicable laws, master plans and approvals of the competent authorities.

Officials clarified that lifting the ban does not automatically permit commercialization. Any proposed changes to land use must still comply with existing laws, master plans, and the necessary approvals from competent authorities. This ensures a controlled approach to land use conversion, preventing unchecked commercial development.

The decision aligns with a May 2026 order from the Federal Constitutional Court (FCC). This order effectively rescinded earlier notifications from 2019, which had frozen land-use changes following Supreme Court directives in 2018 and 2019. The FCC's ruling provided considerable relief to builders and developers who had faced restrictions.

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The court would not interfere in the functioning of institutions such as the Sindh Building Control Authority (SBCA).

A two-member bench of the FCC, led by Justice Aamer Farooq, overturned a previous ruling that prohibited the conversion of residential plots for commercial use in Karachi. However, the court specified that amenity plots, such as parks, hospitals, schools, and playgrounds, remain protected and cannot be converted for commercial or residential purposes. Justice Farooq also noted that the court would not interfere with the functioning of bodies like the Sindh Building Control Authority (SBCA) and emphasized that laws already exist to address building regulation violations.

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The court’s suo motu powers no longer exist and emphasised that laws are already in place to address violations of building regulations.