Financial Times

Beachfront properties lose glamour over 100 m rule?
Demand for seafront properties in southern Sri Lanka - rising over the years particularly from foreigners - is likely to fall if the government maintains the 100-metre ban on building construction, real estate analysts said.

However real estate agent Nethru Nanayakkara said though the strict enforcement of the 100-metre rule would result in beachfront properties being less attractive, he believes the situation would improve in one or two years time since access to the beach would still be available.

Analysts say demand for land and beachfront property after the tsunami hasn't fallen though not many land deals are going through, especially along the coast. Nanayakkara says that people are hesitant to invest and buy land that fall within the buffer zone mainly because no proper decisions have been made on the 100-metre rule. Another barrier for foreigners buying land is the 100 per cent property tax.

He said that if the new rule is enforced, the demand might shift towards two or three-acre land where people can build leaving the 100-metre zone and still hold the appeal of beachfront property. According to Suresh Rajendra, director of Keells Realtors, the company is not concentrating on buying or selling since the tsunami, till there is clarity about the 100-metre issue. "We're holding our horses," he said, till the uncertainty about the rule and also its implementation is clear.

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