Update for April, 2019: Myanmar started allowing foreign real estate ownership in 2016 since this article was originally published. Yet the nation’s economic and political conditions are not currently positive. You should consider holding off on investing in Myanmar property for now.
Emerging Asia can be a very tough place to own real estate as a foreign national. For example, the Philippines constitution bans all non-Filipinos from owning land. Meanwhile, non-citizens in Sri Lanka and Singapore pay more tax when they own property.
However, there are signs this might change soon. 2015 saw the official start of all countries in the Association of Southeast Asian Nations (ASEAN) merging to form a single market.
Establishing the ASEAN Economic Community, or AEC, is expected to boost foreign investment in the Philippines and other untapped markets across the region. As a result, that will pressure lawmakers to amend ownership restrictions.
Foreign ownership laws will come into focus elsewhere in Asia. Debate continues in Indonesia and Myanmar about opening up the countries’ property sectors to international investors.
This should be a sign of relief for real estate agents in Myanmar. A lack of foreign investment is one of three major constraints on the nation’s property market.
A recent study conducted by House.com.mm revealed that 24% of international house hunters and property agents saw a shortage of foreign investment as a main factor preventing the real estate market in Myanmar from rising.
Foreign Property Ownership Could Jumpstart FDI
Myanmar is now ecoming increasingly attractive to foreign investors of all kinds. Foreign direct investment (FDI) grew from US$1.9 billion during the 2011-12 financial year to over $5.8 billion in 2018-19.
The bulk of this foreign investment went towards Myanmar’s energy, garment manufacturing, information technology, and food sectors according to the World Bank.
In terms of real estate, foreigners face severe restrictions on purchasing property in Myanmar though. According to Article 31 of the Foreign Investment Law, foreign investors can only lease land for up to a 50-year period.
But recent government initiatives provide some encouragement for property investors. These include a draft Condominium Law that allows developers to sell up to 40% of units on the sixth floor or above to international real estate buyers.
Furthermore, the outlook for property investors is already improving. Most surveyed brokers in Myanmar noted increasing levels of foreign investment lately.
A bustling tourism sector is another reason why Myanmar property is attractive. The Ministry of Hotels and Tourism aims to increase international arrivals to 7.48 million before 2026.
That especially presents a significant opportunity for property investors in the hospitality and holiday rental markets.
Given all the above factors, along with the general low purchasing power of Burmese people, there is certainly enough room for outside investors. Myanmar foreign real estate ownership should benefit the country as a whole.
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