Sri Lankan property market to boom in coming years – Real estate developer

 From left: JKP Head of Sales and Marketing and John Keellls Group Vice President - Nadeem Shums, JKP Head of Asset Management - Rusiru Abeyasinghe, Union Bank Chief Executive Officer–Dilshan Rodrigo and Union Bank Senior Vice President (Retail Banking) -Chaya Jayawardana.

Pic by: Kithsiri de Mel 

By Ishan Sheriffdeen 

Sri Lanka’s property market that had been hindered by several challenges including regulatory policies, economic volatility and rising material costs, is expected to well in the coming years, according to the country’s largest real estate developer.  

“We are seeing an improvement in the property market at present.  Interest rates have stabilised to some extent. From the highs of mid 20 percent interest rates from a few years ago, the housing loan rates have come down to around 12 percent. With low fixed income rates, people are also shifting from fixed income instruments such as fixed deposits to real estate and other investments. 

“Overall, things seem to be okay concerning the economy. It has kind of stabilised.  In this context, we expect the property market to do well going forward. There is demand coming in from all segments. It’s not just from the lower end; it’s from the middle and higher ends as well. We see good traction coming in, and we expect that to continue, given that there is a strong mandate from the people for the new government to do well. Over the next few years, we expect that kind of stability to take us through and for the property market to make a transformation,” John Keells Properties (JKP) Head of Sales and Marketing and John Keellls Group Vice President, Nadeem Shums told Mirror Business this week on the sidelines of announcing the groundbreaking partnership between JKP and Union Bank to offer the “Zero-Down” homeownership plan for buyers of ‘Viman Ja-Ela’ housing project.

With Zero Down, Union Bank will provide 75 percent of the project funding upfront to customers as a Union Bank home loan, and will be disbursed in stages. During the project period, customers will pay only the monthly equated Union Bank home loan installment. The final payment of 25 percent equity has to be paid by the customer directly to JKP at the end of the project, in approximately two years.

“This is something Union Bank had brainstormed. Upfront cost has pushed back homeownership for many over the years. At the same time, the demand for flexible, affordable housing loan options is also on the rise among young professionals and families. The ‘Zero Down’ plan has come up with a solution to these issues, making housing accessible in good locations. 

“We are also looking at attracting more Sri Lankan expatriates through this scheme. Quite a number of our buyers are Sri Lankans living overseas, especially in the Middle East,” Shums added.