Low interest rates an enticer for apartment buyers
Mr. Shamitha Ganegoda
Current low interest rates are a big contributing factor in selling an apartment, Shamitha Ganegoda, Managing Director Elish Development Pty Ltd which builds ‘The Flemington’ apartments said.
In an interview with the Business Times recently, he said that so far, the pre-sales of their Colombo 4 property has recorded 80 per cent. “Professionals and businessmen have bought apartments and we see a rise in demand.” He added that fixed income securities are maturing and owners of these instruments want to reinvest. As such, apartments are becoming a popular option. He also noted that banks extend credit in the form of tripartite loans to buyers which are becoming exceedingly popular. “People are also realising the importance of having real estate, as an asset class in their investment basket,” he added.
Analysts also said that lower rates will sustain the higher demand home buyers to shop. Home purchasing power through lower interest costs, with the need for alternative asset classes make real estate an especially attractive investment at this time, Mr. Ganegoda added.
He reiterated that it’s a great time to build apartments. “Now we are coming out of the coronavirus situation and there are a limited number of projects in the market. So, therefore the focus is central. There is a market demand based on location,” he explained. He said that Flemington’s business model is to have two projects at hand – one which is in the last stages and the second at the initial stages.”It has worked very well for us.” To date, The Flemington has successfully completed and handed over two projects situated in Rajagiriya and 103 Campbell Place (Colombo 10) in addition to the Colombo 4 complex now being built.
He also pointed out that many people are struggling with traffic in Colombo. “Many want to avoid traffic and purchase apartments. The central location that we build apartments gives us an advantage.” He also added that development happens around the Greater Colombo area. Agreeing that the market is tougher than before, he said that without advertising their Colombo 4 property saw large pre-sales.