Majority condo buyers local, says developer; expects increase in expat buying

By Harshana Sellahewa
The statistics obtained by John Keells Properties Sector Head Nayana Mawilmada revealed that the majority of the Colombo-based condominium buyers are local, standing at 65 percent, while 27 percent are expatriates.

He said that although the majority of the purchases are made by locals, rentals and occupancy are mostly covered by expats.

Commenting at a showcasing of Tri-Zen’s model apartment, a venture of the John Keells Properties sector of the John Keells group, he said that this trend would see a significant shift through income and building segments alike.

“54,000 resident visas were issued by the Immigration Department in 2018 and this number is set to grow. Expats as a percentage of the total population is 0.2 percent,” he said, adding that “the expat population will inevitably grow, the more stable and mature we become”.

He also said that this would be supplemented by the tourism industry, as tourist arrivals are on the increase with trends shifting into Airbnbs and other forms of accommodation, which goes well for the rental market in Colombo.

“Right now it is around US $ 67 on average in Colombo on Airbnb,” Mawilmada said.

Meanwhile, he elaborated that “90 percent of us live in single family landed housing, which is very low compared to other places”.

He said that this trend is also going to shift due to the hikes in land costs, tricky construction processes and scarce availability in land spaces, implying that the ideal living mode is apartment living. 

“In our opinion, Colombo will evolve on three major frontiers. I think we will see massive changes on how we get around in the next few years, we will see major increases in apartment living and we will see fundamental shifts in who will live in the city of Colombo going forward,” Mawilmada said.

He stressed that one of the major driving factors for this is the traffic situation. 

“We’ve got 44 percent of the trips coming in taking up 87 percent of the road space in the city. We see the vehicle numbers completely going upwards regardless of how much we tax it, we whine about it a little bit and then we keep going back to buying cars.”

He added that the speed of travel within city limits at peak hours are very low, saying that those travelling from Rajagiriya for example will realise that they spend up to one and half hours a day, one way, on the road.

“When you add this up it totals to around five or six years of your life on the road. So in our opinion, as a city, we are at a tipping point; something really has to change and we haven’t really talked about how much social impact this has,” he said.

Mawilmada further opined that an important factor is that overall, Colombo is 10 percent apartment housing, while its peer cities are at least at 50 percent. 
“There is only one way this evolution can go and our job is to engineer and enable that future.”

Meanwhile, Hatton National Bank introduced attractive housing loan schemes exclusively for women hoping to invest in John Keells Properties’ latest development - Tri-Zen.

The bank’s exclusive housing loan package, the result of a partnership between the bank and John Keells Properties, offers funding up to 80 percent of the purchase price of the apartment unit, payable with loan tenures going up to 25 years and a grace period of five years for the capital repayment with an attractive interest rate that could be arranged for five or 10 years.

With a reservation fee of 5 percent of the purchase price and 15 percent of equity contribution by the investor over the construction period, the apartment can be secured following an easy three-day loan approval process.