Colombo suburb land price trends positive : RIU study

Suburbs of Sri Lanka's business capital Colombo are experiencing positive trends in terms of land prices, according to the second in a series of research reports published by the local office of KPMG in association with Research Intelligence Unit (RIU).

The report, entitled "Changing cityscape: Real estate market brief; Issue II

- 2012", revealed that the 14year average land price in Mount Lavinia was Rs. 629,074 per perch. And that the average land price per perch was Rs. 1.392 million over the last 12 months. However, the report also noted that there was significant variation between differ- ent areas of the municipality, while also indicating that land prices in the area had recorded a high of Rs. 3 million per perch.

Commenting on Mount Lavinia, findings suggested that the 14-year average land price per perch for this suburb was Rs. 538,165, which had gone up in recent times to Rs. 733,333 per perch as the average land price over the past 12 months. It also highlighted that, while there was a "clear positive incline" in terms of land prices, these price variations were also "less scattered".

Signalling that Battaramula / Pelawatte showed the largest changes since 2004, attributable to more affluent neighbourhoods (in close proximity to the Parliament Complex) alongside lesser developed areas, the report concluded that the land prices in the area was Rs. 707,500 per perch over the last 12 months.

Stating that large variations were also shown in Rajagiriya, due to affluent neighbourhoods coming up alongside those less so, and especially over the last eight years, another finding, for the last 12 months, was that the average land price in this municipality was Rs. 1.72 million per perch, with a high of Rs. 3.5 million having been achieved during 2011.

Additionally revealed in the study, average land prices in Kohuwala too fell in line with this overall positive trend as indicated by this suburb's moving average of Rs. 1.146 million per perch over the past 12 months, and a high of over Rs. 2.5 million having been reached last year.

The KPMG/RIU report also cautioned; "For the first time in Sri Lanka, the leisure sector has outpaced housing as the driving force of the construction industry. This is a strong indication of a short-term boom whilst in the long term the market is expected to settle

on a more steady incline that reflects the overall international travel environment." (JH)