All perfect praise be to Allah, The Lord of The Worlds; and may His blessings and peace be upon Prophet Mohammad and upon all his family and companions.
A real estate, under construction, should pay the Zakah due on tradeable items, so if the property was prepared for sale, it is evaluated at the end of each lunar year, even if it is being constructed, as indicated in the following Hadith: Samurah bin Jundub (RAA) narrated that The Messenger of Allah (PBUH) used to command us to pay Zakah from (the goods) we had prepared for sale. {Related by Abu Dawud & Al-Baihakhi}. Evidently, the Prophet (PBUH) has commanded Muslims to pay the Zakah from the goods being prepared for sale.
In other words, the items intended to be sold, even if they weren`t offered for sale, and the owner had intended the sale upon the possession of the land over which the real estate was to be built. Juristic texts indicate that what counts is having the intention to sell the property, not to offer it for sale. Al-Imam Annawawi said: "A tradeable item is what is intended to be sold for a profit, upon possessing it, through a commutative contract. Moreover, if the intention of selling an item was combined with purchasing it, then it is a tradeable item." {Rawdat Attalibeen Wa Umdat Almufteen 2/266}.
In principle, a finished real estate prepared for sale should be evaluated according to its average market value on the day Zakah is due on it.
As regards an unfinished real estate/under construction, it should be evaluated according to its current value, as assessed by experts of that field. However, if that wasn`t possible, it should be evaluated according to its cost price i.e. the cost of the piece of land and the construction materials. This has been stipulated by Companys` Calculation Guide (P.34), and the Sharia standards of the (AAOIFI), (standard , 34). And Allah knows best.
