The Good and Bad of Real Estate Investments

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There’s no doubt that the real estate market in Sri Lanka is a lot more stronger than it used to be. If specifically consider about the rental market; there’s an exponential growth in that sector as well, specially around Colombo and its suburbs including Nugegoda, Kirulapone, Kotte, Battaramulla and Wattala.

Property prices have escalated in the last few years, making a favourable situation for property owners in Colombo. They can either sell their properties or rent for short or long term, with a very high profit margin. These can be known as the two of the best options to make money from real estate market.

Most property owners sell their properties for a very high price and invest the profit to buy even better properties; with time, as property value increases, this will become a very successful method of investing.

The rental market is very established around Colombo 6,9,10,13,14 and 15. Commercial and luxury property developers have still not implemented construction plans around these areas. The government has shown an interest in improving infrastructure services around Colombo 1,2,3, and 4. Due to these reasons people can reach out for high quality and affordable rental properties, around above mentioned areas.

Buying a home around Colombo suburbs would cost around LKR 10 million, the cost depends more on the location of the property. A mid range house in Colombo suburb would cost between LKR 25,000 to LKR 65,000 per month.

Newly weds and people who are working in Colombo and suburbs likely to become long-term tenants. This is an excellent way to make a profit.

The demand for rental property is growing day by day.

Most of the properties around Central Colombo, including Colombo 3,4 and 5 are being rented for approximately LKR 65,000 to LKR 180,000 per month. Prices can vary depending on the size, location and facilities available. When you consider this price range, tenants are likely to be foreigners or high earning nationals. This is a great way to have a stable income as these kind of people often look for long term rental options.

Investing in a rental property can be a hard decision, both buyers and sellers must think thoroughly before making a decision. The main disadvantage when renting a property is maintenance and repair. But overall renting a property can be a good investment.

The Good and Bad of Real Estate Investments