Should you buy or rent a home?
October 2022 | Lanka Island Properties
Generally speaking, within Sri Lanka and those relocating to this tropical island, there is a strong desire to own their own homes, both from an investment as well as a lifestyle perspective. A question which often arises with home seekers is ‘should I rent or should I buy a home?’ This is obviously a very broad and potentially multifaceted question, with many factors influencing your final decision. “These can often include the individual’s personal financial circumstances - in other words, individuals decide to rent because they cannot afford to buy, or it could be due to visa constraints, retirement or short transient stays in the country. In addition, there may be other personal influences such as employment status and prospects, family composition, lifestyle preferences, hobbies and activities that play a role in the decision whether to rent or buy a home. Generally speaking, a Sri Lankan has the ability to raise a mortgage or obtain a financial loan to build a new home for themselves and family. This unfortunately is not the case when it comes to a foreigner investing in Sri Lanka. Unless you already own a property that can stand as collateral with the bank, one is not able to finance or gain a mortgage for the purchase of a property. All transactions are on a cash basis on the day of signing the purchase agreement. Another perceived advantage of renting in Sri Lanka is the flexibility and ease of mobility that renting offers. Being 'locked into' a property for a relatively short period of time makes it easier to extricate oneself from a lease should you need to relocate, and therefore not having to sell before being able to move. This makes the rental option ideal for those that only plan on staying in the country for a short period of time. The rental market is rather fickle here, many properties become available for rent for a period of 6 month – thereafter they will operate as a bed and breakfast during the peak season. This makes it very difficult to secure a rental property for more than a 6-month period in some cases. It is essentially a question of one's own financial situation and requirements rather than a case of one versus the other. Renting a home can also give you time to decide where and what you would like to purchase in Sri Lanka and gives you time to decide if this is a country that you would like to settle in. Many people come to Sri Lanka and purchase for the sole intent of developing a tourism project such a hotel, guest house, yoga retreat or surf school. Tourism has been through some turbulent times of late, but it is a country with resilience, immense beauty, fauna and flora, mountains and coastline and it has the uncanny ability to bounce back in no time at all – its hard not to want to visit Sri Lanka. A tourism project has always proven to be a sound, medium to long term investment - and remains so. This is despite the fact that there may be some troughs as well as peaks in the revenue growth of the property along the way, depending on economic trends, the desirability of the property and its location, and so on. In many cases we have properties rented out for 10 to 15 years to operators that are not planning on living in the country, but are able to have a management team in place to run the hotel or guest house. A rental for this duration of time, unless it is in the most spectacular location and you would never afford to purchase it, is probably not the best use of your funds. Careful consideration should be taken as to the duration of the tourism seasons and anticipated occupancy levels through the rental period. Always make sure that you do not over extend yourself when making a property decision, the rental on a property will increase year-on-year and if you need to rent for an extended period, it may mean that you will have to move every year. Rent out an investment property With the recent financial crisis in Sri Lank, I’m sure the question arises, ‘is now the time to buy?’ Besides everything, Sri Lanka is a popular tourist destination in the world and attracts many investors and elite and exclusive individuals who are keen to make significant property investments in the local real estate market. The demand for luxury residential properties and beach front properties continuing to soar with each passing year. Property acquisition prices have risen slightly in most cases, this is due to the rise in building costs and inflation, however with the favorable exchange rate, it still makes for a cost-effective investment for the foreigner. Purchasing a home or building your own home and being able to monetize the property with enable you to enjoy a monthly income stream as well as capital appreciation growth on your investment over the longer term. The question to buy or rent is always debated but the fact is, wealth is created through the purchase of property as owners have the ability to obtain a mortgage, upgrade or refurbish their properties - while making improvements to suit their own requirements and lifestyle - and then to sell and buy a more expensive property, and in doing so increase their personal net wealth. No matter what your decision is, always remember to contact a reputable Real Estate company for advice and guidance and up to date information on the property market in Sri Lanka.
Travel information and a few links to help you plan your journy to Sri Lanka
November 2022 | Lanka Island Properties
- General Information
- Residence Visa
- My Dream Home Visa (Retirement visa)
- Resident Guest Visa
- Golden Paradise Visa
The Process of property purchase in Sri Lanka
December 2022 | Lanka Island Properties
The process of buying a property differs depending on where you are in the world. Buying property in Sri Lanka may seem a little complex and convoluted. Our buyers guide will help you to familiarize yourself with the process so that your search and potential purchase is as smooth as possible. Lanka Island Properties ( Pvt) Limited is here to help you and guide you through this.
Establish your Budget
This is important as it will give us an indication as to what level of investment or investments you have planned for and it will also save both you and us time when creating a property list for your viewing. Also bear in mind that there will be additional costs to be considered when buying a property and we will discuss these costs with you so that you are aware of these and take them into consideration when establishing your budget.
Know the type of property
Knowing whether it is a villa on the beach, a colonial house inland or bare land with views of the sea or a paddy field will also assist us in creating a viewing list for you. It is wise to do some research on the types of property available. Also, knowing whether it will be an investment property or one that you will live in would help. We will also explain the nuances of each property type with you so that you have every confidence in your investment choices. Use our enquiry form to learn more.
Location, location, location
Know which area or town in Sri Lanka suits you best. Whether it is a home up country, inland or a home on the South Coast we will be able to help. You may have travelled around Sri Lanka and may need to explore more. Let us help you by sending us an enquiry or by calling us.
Once we have established the above criteria, we will develop a selection of properties that meet these for your viewing. We will arrange suitable viewing times and will be in attendance at each one. Keep an open mind, see as much as possible, perhaps do a second or third visit to a few to enable you to find the property that suits you best.
Make an offer
Once you have viewed the properties that match your criteria and have found the property you wish to purchase, an offer will need to be made to the seller and the process of securing the property in your name will begin. In the background, a title deed search will have been done by our lawyers to ensure that you are purchasing a property with a clear title and that there is nothing that could impede the purchase. The offer will be considered by the seller and we will be informed of their response.
Company structures and setting up
The preferred and most secure way to purchase land or property in Sri Lanka is the Freehold method which involves having a company structure involving two entities being set up in your name. This may sound a daunting task, but with our guidance and with the assistance of our preferred lawyers and accountants this will be a mere formality. We have the expertise and the service providers to guide you seamlessly through this process. Our preferred lawyers will also be responsible for the sale and purchase agreement for your property and for registering the title deed in your name with the Lands registry. Please do inquire should you wish to have further details on this point.
In order to complete any transaction with regards to property in Sri Lanka, the prospective purchaser will need to open an Inward Investment Account (IIA) with a preferred leading bank, close to where you wish to purchase for convenience’s sake. This is the most flexible and convenient vehicle when considering purchasing property in Sri Lanka as any Inward remittances made through this account will be able to be repatriated to your home country through this account when the property is again sold. Should you require additional information on the IIA account please just ask.
Any sale of land or property will need to comply with laws and practices set out in the governing property laws in Sri Lanka. Care must be taken that all conveyancing is done by reputed law firms and that title deed searches are carried out meticulously in order to protect and secure your rights to the property which you intend buying. There is a process which must be followed and we will guide and assist in ensuring that you work with the best lawyers and that you are in very safe hands.
Documentation and other requirements
As is the case with any property purchase, there will be a number of documents required by us and those assisting you with your company set up, banking requirements and property purchase. Each party may request different documents for each purpose, and at different times. We will assist in making sure that you are asked well in advance for any document and we will ensure that any documents handed over to us are treated with strict confidentiality by ourselves and any other party.
We trust that you have found this information useful and look forward to being of further assistance in your search, selection and purchase of property in Sri Lanka. Should you require any additional information to the points above please don’t hesitate to send us an enquiry or give us a call. We will respond as soon as we possibly can.
When is the best time to visit Sri Lanka?
March 2023 | Lanka Island Properties
Tourism in Sri Lanka is again and so is the number of people calling this country their new home. In 2009, the civil war that lasted for over 25 years finally came to an end and this was the beginning of an exciting new era for the country and an opportunity for the rest of the world to explore its beauty.
Sri Lanka offers a wealth of experiences for visitors, from swimming in the blue-green waters of its majestic beaches, exploring its abundant wildlife and touring its UNESCO World Heritage Sites. A country with a vast cultural history, Sri Lanka has something to offer everyone who visits it.
Many locals speak English, making communication easier and getting around is not a problem either with well-developed infrastructure. Many 'Western' facilities are available, and a lot of ex-pats emphasize how easy it is to get used to the way of life in the country. Living in Sri Lanka will open one's eyes to the exotic and unusual beauty hiding in the ancient sites of the country.
Best season to travel when looking for an investment property
For those looking to purchase a property in Sri Lanka, understanding the best time to visit can help ensure you have the best possible experience. The country's climate varies depending on where you are, and although anytime of the year is suitable, the best time to visit really depends on what you're looking for.
We are often asked when to visit Sri Lanka so we have put together some weather advice for our investors and travelers alike to ensure they have a great holiday and get some good property viewings in whilst they are here.
High season on the South West Coast
November - April is the best time to visit the South Coast. During this time the weather is awesome, mostly dry, with temperatures around 30 degrees with high humidity. Amazing beach weather and excellent surfing conditions.
By the end of April, the rainy weather will start to creep in, with heavy rainfall every few days in the afternoon.
Low season on the South West coast
May - October the Monsoon season brings some heavy rain, wind, and rough seas to these coastal regions. Generally short and sharp rains, with the potential of flooding in some parts. The temperature is far cooler with less humidity, but always warm. As the daily rainfall is so unpredictable this makes property viewing quite arduous.
With all that said, it is safe to conclude that should you be traveling to Sri Lanka only to view property that of course any time of the year is suitable, however, should you wish to have a holiday at the same time and enjoy the wonderful activities on offer, it would be best to visit between November and April.
Despite the wet season beginning in late April, there's still plenty to keep you occupied during this time. Offering a quieter atmosphere, the monsoon season is ideal for travelers looking to truly immerse themselves in the culture and get to know the locals. With temperatures standing at a comfortable 30 degrees Celsius, it's still warm enough to enjoy outdoor activities such as wildlife safaris, exotic bird watching and exploring the ancient ruins scattered around the island.
No matter when you choose to visit Sri Lanka, you’ll find welcoming people, delicious food and plenty of exciting activities to make your stay a truly memorable one. So come and join us in this paradise island of sunshine and warmth, and experience all that this remarkable country has to offer.
We have an extensive portfolio of listed properties for sale on our site, do hop on over and have a look. We trust this has giving you an idea of when the busiest periods for tourism are on this lush island, so that you can plan your visit accordingly.
How to Choose the Best Investment Property in Sri Lanka
May 2023 | Lanka Island Properties
Investing in property in a foreign country is a daunting task but us doable and very achievable when you work with the right Real Estate Agency and have the correct information on hand.
Like any other country, Sri Lanka has its rules and regulations at times is rather vague on certain things, and a little difficult at times to find the right information.
I would therefore like to offer a little information and advice on choosing the perfect holiday home or property on the South Coast of Sri Lanka.
Location, location, location. This may be a cliché used by property experts, and it certainly should be at the forefront of your property investment consideration, even in Sri Lanka.
When determining the location there are certain factors to take into account.
What is the intended purpose of the investment i.e:
- Primary residence
- A guest-house
- A boutique hotel
- Personal holiday home
- Wellbeing and or yoga retreat
- Adventure retreat
- Surf school and hotel
What would be the ideal extent of the land required?
Beachfront property is expensive and generally smaller in size. As you move further inland the properties are larger and less expensive. In my opinion to get value for your money always look for a property which has a view. Either set up on a hill, overlooking a paddy field, sea view, or lake view. The view certainly adds to the proposition of the property.
Where would you like your property to be located?
The number one reason clients want to invest on the South Coast of Sri Lanka is because of the sea and the coastline, which is fringed with numerous golden beaches. Depending on the purpose of the investment, this would most certainly dictate the chosen location of the property. One thing for certain is, you would like to position yourself probably no further than 4km inland from the coastline. Your guest and family will certainly appreciate the close proximity to the beaches but will also enjoy the slightly cooler and less humid weather away from the coast.
What facilities and amenities are in the area?
On the South Coast, we have many large towns and many small villages stretching the length of the coastline. Getting to know what is available in the chosen area, i.e restaurants, swimming beaches, supermarkets, fish and fruit markets, and what tourist attractions are in the vicinity would be an advantage. It is also good to understand the public transport situation and whether the property is on a bus route or accessible to a train station.
Enlist Professional help
Once you have gathered all your information it's then time to enlist the help of a professional and reputable Real Estate Agent. As a leading real estate agent in Galle, we encourage you to hop over to our website and take a look at the extensive portfolio of properties which we have listed, and come in to discover the many more which are not listed.
Once you have settled on a few of interest please get in touch, let us know what you are looking for and we will handpick properties that we feel would best fit your requirements.