Myanmar real estate is getting ‘better and stronger’
Myanmar real estate is getting ‘better and stronger’
Slow and steady wins the race
A leading developer has expressed hope that sentiment for Myanmar property would grow more bullish as the country adjusts to the incumbent government, led by Aung San Suu Kyi’s National League for Democracy (NLD) party.
Serge Pun, executive chairman of the SPA Group of Companies and Myanmar’s Real Estate Personality of 2016, believes the market will get “better and stronger” in the next four years under NLD rule. “There would be real demand emerging from the market, which was not the same as the demand derived from property speculation in the past,” Pun said at a press conference on 4 February.
Myanmar finished 2016 with a gross domestic product (GDP) growth of 6.5 percent, a decrease of 1.3 percentage points from The World Bank’s forecast. The disappointing growth may be attributed to a flagging construction sector, the bank’s new Myanmar Economic Monitor (MEM) alleged.
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Pun downplays the gravity of a waning property industry. “I don’t think that the slow growth of the real estate business is a bad situation, because over the past 24 months, the market was slow but the price was stable,” Pun told Myanmar Times. “But five years ago, the real estate market, especially in Yangon, the prices of lands and apartments or condos were surging extremely rapidly that we can call a critical condition. So, now, the government has adjusted the market and this situation is no longer as worrying.”
From May through November, the Yangon Region government executed an order suspending the building permits for all structures exceeding nine storeys. The far-reaching ramifications of the edict have led to a halving of new construction projects in 2016, according to U Yan Aung, general manager of Asia Construction Co.
Although the number of luxury condominiums in Yangon stands at around 6,000 units, the closing rate for new units in the city has fallen to 50 percent, compared with 80 percent in 2013, the Nikkei Asian Review reported.
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Source: Property Report