It’s the start of a new decade and a new beginning and there is a lot expected to change. Here is what you need to know on the real estate trends expected to make breakthroughs for this year.
Moving from the busy city to the chill suburbs
There was a time when the suburbs were considered too ‘basic’ to live or even buy a home in. As a result, more people moved to the main cities leaving the rural and suburban areas. But now moving to the suburbs is the new trend that everyone is striving to be a part of. The advance technological changes that have led to the improvement in transportation, apartment constructions in the suburbs, increasing environmental pollution and home prices in the main city, have all contributed to this trend.
Meanwhile, luxury apartments in the main city are still unable to accommodate the continuously growing population. Space and price are also always at opposite ends in even the best apartments. At the end, you could be living in a lavish condominium with space strictly restricted for obvious reasons.
This imbalance, however, has also paved the way for new opportunities in the housing market. According to the recent studies of Lanka Property Web, apartment developers are now exploring the spacious suburbs where they can cater much better to the expectations of clients. Still filled with greenery; the spacious suburbs are less prone to the decreasing quality of air too. Therefore people can expect a better quality of life here, more than in the main city.
Locally as well, these changes have been witnessed over the past couple months in the real estate market. The rising air pollution in the main city, the government’s goal of converting the metropolitan city into a business hub, the increasing gap between land price and space are all creating rippling effects throughout the real estate industry in Sri Lanka.
While the main city becomes a business hub, the suburbs are turning into residential areas. To facilitate this, transportation and other infrastructure facilities are expected to reach high levels, within the upcoming decade.
Millennials purchasing homes
Studies conducted by popular sites like realtor.com, show a common trend of Millennials dominating the home buyer category. This is in addition to the baby boomers who are increasing in number too. Citing reasons as them finding more stable jobs, earning a stable household income along with starting families and becoming parents; many are first time home buyers or starter home hunters.
Since Millennials use the internet more to gather information over any other source, ensuring your business has a reputed online presence is key. This will surely go a long way in reaching the expected business outcomes. Including additional service details like a house loan calculator, updated mortgage rates and latest estate trends in the website, could further improve your credibility and trust in their minds.
Millennials also seek space, affordability, close vicinity to the main city with a reasonable cost of living. Thus homes in the suburbs are welcomed more by them. Accordingly, providing such information transparently and in-depth while selling homes is necessary to attract the right customers.
The imbalance between the growing population and the lack of space has led to an increasing number of apartment constructions taking place. Peoples’ expectations in terms of amenities and services offered by these are on the rise too. As a result, they are more particular about what they are looking for in addition to price, location, etc.
Influenced a lot by modern global trends with the advancing technology and globalization, people expect the same locally as well. In the real estate industry, this causes comparatively high pressure on the developers of these apartments. Hence, striving to keep up with the upcoming trends of this industry is a special factor to pay heed to.
Government policy changes
Over the years in Sri Lanka VAT has been a huge part of taxing and a large source of income to the government. With the appointment of the new government on the 18th of November 2019, VAT rates were revised.
- VAT on condominiums – taken off completely.
- VAT on other goods and services reduced from 15% to 8%.
- Nation Building Tax 2% charged on domestic goods and services and economic services – removed.
- Income tax on the construction industry reduced to 14% from 28%.
These are all expected to create rippling effects in the real estate industry of Sri Lanka. Consequently, increasing the opportunities and capabilities of those looking to purchase property.
Ease in obtaining Home loans
Today obtaining housing loans in Sri Lanka; especially in Colombo can range between a period of 3 to 14 days. As interest, a fixed rate between 12% – 15% is charged. Certain banks even allow those above the age of 55 to obtain housing loans repayable within 20-25 years.
All these bare evidence to how far the banking system and the government have come far in facilitating housing for everyone. As a result, influencing and affecting the real estate industry on the whole.
Since now more people are even considering purchasing property of their own and renting out for short stays, being aware of what is to come in the future for the property market is required to make the best out of real estate marketing!