Developers are pinning their hopes on completed Condominium Law this year to jumpstart the quiet property market.
Foreigners are currently barred from buying condo units, though a draft of the law has said foreigners would be able to purchase units on the sixth floor or above, up to a maximum of 40 percent of the building.
The Condo Law has been repeatedly delayed since 2013, though, and experts say they now hope to see a final version before the end of the year.
The law contains more than 60 main points, but many of them are still under discussions, according to Myanmar Real Estate Services Association president U Khin Maung Than.
The most significant of the 60 points is likely the one which allows foreign ownership.
“We hope that, because foreigners will be able to own apartments, the real estate market – especially around condominiums – could liven up,” U Khin Maung Than said.
U Tin Tin, owner of Royal Smart construction company, said passing the law would invigorate a quiet market, but also provide protection and security to buyers.
Industry scandals have marred the pre-sale market, hurting the market.
“If the law comes out, it will help people feel safe about their property, leading the condominium market to be prosperous again,” he said.
Industry insiders say potential buyers cannot simply rely on the law, but must do their own due diligence with developers before making a purchasing decision.
Potential buyers ought to ask for approval permits from Yangon City Development Committee, along with any conditions, as well as the status of the land title.
Still, the law is set to shake up the business. The government will take a large step with the legislation, moving from banning foreign ownership to allowing a significant percentage of real estate to be sold to non-Myanmar people.
Urban planner U Kyaw Latt said that under the new law, up to four of every 10 apartments can be sold to a foreigner.
However, just because foreigners will soon be able to buy property does not mean they are rushing to do so.
“Foreigners who are keen to own properties in Myanmar are taking a ‘wait and see’ position as they look forward to the announcement of the new condominium law,”
said Daw Khaing Mi Mi Kyi, deputy general manager of Capital Development, the firm behind Gems Garden Condominium. “Currently, a small number of foreigners investing in Myanmar purchased property under their locally incorporated companies’ or spouses’ name.”
Daw Khaing Mi Mi Kyi said Gems Garden Condominium buyers are locals, though she has seen interest from Yangon-based foreigners. A majority originate from Asian nations, though Americans, Italians and British people have also made enquiries.
However, owning property in Myanmar is quite challenging, while there are other general concerns around the ongoing political and economic reforms taking place, she said.
Daw Khaing Mi Mi Kyi notes that many construction projects launched recently have made little progress – and that prices are impacted by property location, product offering and who gets hired to help with construction.
“Obviously, the potential foreign as well as local buyers would shy away from overpriced projects when they start comparing them with those of more established neighbours,” he said.
Source: Myanmar Times