Property market shows signs of growth despite high taxes and bureaucratic hurdles

Industry experts at the Lanka Property Show 2025 have expressed confidence in Sri Lanka’s real estate sector, highlighting its potential for growth despite recent economic challenges. While high interest rates, currency depreciation and fluctuating taxes have previously affected the market, experts are optimistic that the stabilization of monetary policy will create a more predictable and business-friendly environment for investors and homebuyers.

Now in its 9th edition, the Lanka Property Show attracted over 17,000 visitors in person and virtually. This year’s event, held at the Kingsbury Hotel, featured over 25 leading projects and saw a significant increase in both exhibitors and visitors, indicating a strong recovery from the pandemic and the economic downturn.

The panel discussions focused on key issues affecting the market, with former Central Bank Governor Dr. Indrajith Coomaraswamy noting that stabilising economic conditions provide a strong foundation for the sector. Meanwhile, Prime Group Chairman Premalal Brahmanage pointed to the high construction costs in Sri Lanka, which can contribute up to 40% of every property transaction due to taxes, and urged the government to support the sector more effectively.

The challenges of attracting foreign buyers were also discussed during the discussions. Kishore Reddy of Platinum Realty Investments called for the prompt implementation of investor visas, which are difficult to obtain despite their official announcement. He also advocated for reducing import duties on essential building materials to reduce construction costs.

Panelists on affordable housing also presented at the event, highlighting the importance of sustainable design and cost-effective solutions such as passive design and green roofs to reduce housing construction costs.

The event highlighted a resilient property market with increasing buyer interest and investor confidence. Experts agreed that with continued policy stability and cooperation among stakeholders, Sri Lanka’s real estate sector is poised for sustainable growth.