ECONOMYNEXT – The highest land prices in Sri Lankan are currently found in the Kotte, Sri Jayawardenapura area, a suburb of the capital in the Colombo district, according to a new study by the Research Intelligence Unit (RIU), a real estate consultancy.
“Land prices in parts of Kotte have been escalating at well over 15 percent per annum according to real estate agents operating in this area,” the report said.
However, the same trend of escalating prices will gather momentum across a much wider area in keeping with ongoing infrastructural improvements, it said.
RIU said an important point to note was that there are some 2.7 million people living in the Colombo district who cannot afford to buy an apartment.
“Furthermore, if we take the Western Province as a whole, then this number increases to around 5.5 million people.”
The findings are in the Bare Lands market report that Research Intelligence Unit recently launched.
The report provides an overview of the real estate boom and an extensive profile of the Bare Lands market, land price escalation as well as the main players in the market.
The report highlights that there will be significant differences between areas that benefit from new road and rail infrastructure initiatives from those areas that do not.
“Hence, the impact on different geographical locations in the Western Province will need to be assessed on a case-by-case basis,” RIU said.
The report also states that “the overall prospects for the suburban land market beyond prime Colombo looks very promising.”
It noted that “Colombo has rapidly emerged as a high -end market that is out of reach for the vast majority of the population which leaves many millions with only one option – the suburbs.”
By some accounts, the average annual price escalation of bare lands in the Western Province is between 7-8 percent.
“However, according to RIU’s own sources, we can note double-digit growth in land plots across many parts of the province, particularly areas that have benefited from ongoing infrastructure development,” a statement said.
(COLOMBO, November 28, 2017)