February 11, 2017

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Hope after Elections — Yangon property market in wait-and-see mode

Bird’s eye view of downtown Yangon, the country’s commercial capital. Analysts say sluggish property market remains muted, but hope that it will rebound after the upcoming elections.
Bird’s eye view of downtown Yangon, the country’s commercial capital. Analysts say sluggish property market remains muted, but hope that it will rebound after the upcoming elections.

The real estate sector in Myanmar is in a holding pattern and will remain so until next year, a developer said at a property conference in Yangon yesterday.
Residential flat prices in Yangon have fallen by 20 percent to 25 percent at the moment, Director U Aung Min of Aung Myin Pyaeson Construction Company said at the conference. “The present trend shows that Yangon’s housing market has become one for those people who really want and need to live in the place they buy.”
With its immense potential for significant profits, a boom in the country’s housing market attracted not only businesspeople but also individuals to invest in the sector since early 2013.
The company director pointed out that people hope, whatever government is formed next year, something will happen to reverse the trend of the currently deflating market that has exerted downward pressures on both sales and rentals after the upcoming 8 November general election.
Investors and developers as well as potential buyers of homes have appeared to be cautious of making deals in the market, preferring to adopt a ‘wait-and-see ‘approach, he added.
The sector is assured of seeing inflows of capital from abroad after the elections, the developer with more than 20 years of experience in the real estate sector predicted.
Daw Moe Thida, deputy director of the Ministry of Construction, expressed her view that the cooling real estate sector is likely to bounce back once the country’s condominium law is passed.
According to developers who built condos in the hope of selling them to foreigners, the law is expected to be enacted in late 2015 when the ASEAN Economic Community will begin.
At a panel discussion of the conference, one of the panelists stressed the need for the government’s involvement in filling the gap between the needs of developers and homebuyers.
“Housing is not a luxury, it is a need for all,” he said.
According to attendees at the conference, skyrocketing land prices is one of underlying causes of the market’s downward trend, with some citing the fact that land and rental prices in Yangon are higher than those in Singapore.

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