While a low interest rate regime helps MSMEs get cheaper credit to weather the Covid crisis, it also drives higher income folks looking for better investment options to invest in the property market. The latest CBSL condominium survey provides some interesting insights on one part of the property market – apartments/condominiums.

In Q1 2021, a much higher share of people bought apartments for ‘investment purposes’ (not ‘immediate living’ or ‘future living’) than the previous quarter or a year earlier. Buying for rent has fallen off significantly.

And the share of those using ‘own funds’ for purchases fell, while ‘bank loans’ increased. According to the latest survey, the “prevailing low interest environment, as well as the increased supply of comparatively affordable condominium projects beyond the city limits of Colombo have led to the increased number of transactions during the period”. Most interestingly, the segment to see the most growth this year, compared to last year, is condominiums outside Colombo – in Gampaha and Kalutara.

Full survey is here – https://www.cbsl.gov.lk/sites/default/files/cbslweb_documents/statistics/condominium_market_survey_2021_q1.pdf