Overseas buyer interest in Sri Lankan properties increased by 40% in 2022, compared with the year before, according to the Real Estate Market Outlook Report 2023, published by Sri Lanka’s leading real estate portal, LankaPropertyWeb.

The report said that traffic from overseas countries such as the United Kingdom, Australia, the United States, Canada, and Middle-Eastern countries saw the highest increase mainly for residential properties in the Colombo district.

While the average asking price of houses has increased by 4.4% and apartment prices increased by 60.4% during the last year, the increased overseas interest, mainly by expatriates is attributed by the report to the decline in the rupee’s standing against the dollar, which saw the rupee fall by more than 80% and thus making property investments more appealing to overseas investors and expatriates with their earnings in currencies such as USD and GBP.

The Market Outlook report also shows that despite many of the initial apartments that came to the market in the late 90s and early 2000s reaching over 20 years of age, their value has continued to grow, dispelling the popularly held notion that well-constructed apartment buildings will lose their value as they get old, in the current context of the property market. With construction costs increasing by more than 65% coupled with housing loan rates increasing by triple digits and the majority of new units still being under construction, the high demand for completed buildings and rentals has been highlighted by the report, using the website’s search and demand analysis.

6000+ new residential apartment units are expected to enter the real estate market in the next two years. With this, the report observes that the total number of recognised apartment units will reach approximately 39,000 by the end of 2025, while 1 million square feet of Grade A office space will be added to the market by the same year.