“We have also seen a rise in the number of housing loans in Myanmar last year,” he added.

The new Condominium Law had been enacted on February 2016. However, rules to the legislation were only released in December last year.

Under the new rules, foreigners will now be permitted to develop property, subject to approval from the Myanmar Investment Commission. The minimum requirements for a condominium project are to build at least 6 floors on 0.5 acres of land area.

In addition, developers will now be allowed to pre-sell new housing units after completing at least one third of the foundation work. The move will reduce the capital burden on construction businesses and real estate developers, enabling them to better manage their cash flows.

Meanwhile, foreigners will also be allowed to buy up to 40pc of completed units on any floor of a condominium block. Under a former draft of the Condominium Rules, foreigners could own 40pc of the floor area in units above the sixth floor only.

As such, real estate agents are expecting more foreigners to take advantage of the opportunities emerging in the property sector.

“We expect more foreign investments into the real estate sector this year,” said U Htoo Myat Naing, director of Estate Myanmar Real Estate Agency. He added that sales of condominium units have risen since the end of last year.

Still, analysts warn that it could take a while for higher demand to have an impact on property prices. This is because supply of available condominiums, particularly high-end serviced apartments, has swelled in the past year.

The completion of Lotte Serviced Apartments last September, for one, had led to a 19 percent spike in existing supply, a record high since 2013, according to research firm Colliers International in a November report.

There are now 1,900 apartment units mostly in Yangon and 70pc of these projects are considered upscale.

Among these, Shangri-La Serviced Residences and Lotte Serviced Apartments are classified as premium properties. Lotte Serviced Apartment features the highest number of amenities and facilities across all serviced apartments.

By 2020, Colliers expects serviced apartments in Yangon Inner City Zone to represent more than half of available supply. Bahan and Yankin townships are the most popular locations, with the majority of these projects still positioned as upscale.

The rise in supply may lead to a considerable surplus starting in 2019 and through 2020, Colliers noted.

Still, it is the lower-tier projects such as studio and two and three-bedroom units that will likely see more buying activity over the shorter term. In addition, demand for studios and one-bedroom units remains underserved and will likely see higher demand due to their affordability, analysts said.

Source: https://www.mmtimes.com/news/property-prospects-positive-2018-real-estate-agents-say.html