In recent years, Sri Lanka has been experiencing a massive demand for property within Colombo and its suburbs. As new large-scale developments are rising in the city, many local and international investors are showing a keen interest in Sri Lanka’s real estate market. Luxury apartments are being constructed all over the city, attracting international businessman and stakeholders migrating into the city. On the other hand, the high living cost in Colombo has resulted in an increase in demand for housing in the outer suburbs of Colombo. This means that increasing numbers of local people are looking to relocate to the suburbs or commuter cities, which are well connected by public transport services.
Rapid urbanization and increased access to all the latest technologies have transformed Colombo into a commercial and tourist hotspot, capturing the attention of stakeholders around the globe. According to research carried out by Lamudi, Colombo is rated as the most searched for city in property listings for housing properties. The development of projects like The 96 Iconic Towers, Platinum, and Shangri La has also led to the luxury feel of the city.
Thanks to the steady growth of the travel and tourism industry, cities such as Kandy, Galle, and Negombo are also becoming more prosperous. Tourists are more interested in renting out houses than purchasing them in these areas. Hence there is a higher demand for rental properties. According to the Lamudi research team, an average 2-4 bedroom house for sale in Negombo would cost between Rs.5.5 and Rs 15 million, for sale. If you are renting out a home, rental prices for similar properties range from Rs 25,000 to Rs 50,000 per month.
As a general trend, most locals are moving towards the suburbs of Colombo where property is less expensive. The suburbs offer a greener environment as well as better traffic conditions. There is a lot of land for sale in the suburbs and still many plots to choose from. According to research carried out by Lamudi Sri Lanka, A small family home in Gampaha (a suburb of Colombo) can be purchased for between Rs. four million/$29,630 and Rs. six million/$44,444, compared to Rs. six million/$44,444 to eight million/$59,260 in Kandy.
The concept of living in apartments is relatively new to the people of Sri Lanka. However, since many foreign and Sri Lankan expatriate investors are migrating into the country, the demand for apartments is increasing rapidly. Most of these apartments are aimed towards the expatriate Sri Lankans who are interested in setting up businesses in their native country and foreign investors who are interested in settling or purchasing a holiday home in Sri Lanka.
According to a survey of local real estate agents in Sri Lanka, 65% believe that the demand for luxury apartments will increase in the next 12 months, while only 25% believe that the demand for luxury houses will decrease.
According to data from KPMG, Price levels for condominium units per square foot (sq. ft.) in Sri Lanka are,
• Super Luxury ― US$230 to US$ 385
• Luxury ― US$ 115 to US$ 270
• Semi Luxury ― US$ 92 to US$ 170