We are pleased to enclose our latest publication on the rapidly growing real estate Industry, which highlights Sri Lanka’s evolving real estate market, including trends of urbanization, land distribution, demand drivers, pricing determinants, legal framework and the concept of vertical living. 

Given below are the key takeaways from the report:

• Urbanization Trends – The World Bank database indicates that Sri Lanka is comparatively lower in urbanization than other countries in the region (Afghanistan 26%, Pakistan 38%, Bangladesh 33%, India 32%, Malaysia 73% and Sri Lanka 18%). However, the National Housing Policy states that Sri Lanka would need 1.5 million housing units over the next 15 years to keep abreast with the expected urbanization rate. A big boost of 3%-4% of urbanization is also expected from 2015, picking up from the stagnant 0.3% reported for the last half decade.

• Land Distribution - It has been determined by the National Land Use Policy that out of 6.5 million hectares of land in Sri Lanka, only 11% is usable for development, out of which, only 3.5% is urbanized.

• Demand Drivers – There has been an increasing level of interest from local and foreign investors on prime blocks for residential and leisure purpose developments. The emerging drivers are factors such as, middle income professionals, per capita income, tourist arrivals (20% YoY growth) which have been increasing and changing lifestyles.

• Legal Framework – When the concept of condominiums was introduced in the 1960s to Sri Lanka, the State had ownership of units. By 1973, the Apartment Ownership Act was passed, which permitted the preparation of condominium deeds granting owners the right to their own units.