In the new global economy, the world has gotten seemingly smaller. We can connect with friends and family almost instantly, phones travel with us everywhere we go, and homes and apartments in Sri Lanka are being occupied by more and more overseas buyers from a variety of places.
While many locals are noticing this, others are seeing the incredible opportunity that this brings to the economy, particularly those who are invested in real estate, or desire to be. The reason for this has to do with supply and demand.
Supply and Demand for Real Estate in Sri Lanka
There is a basic economic principle that states that when a good or service is in higher demand the relative supply will be less, making the price higher. Likewise, there is an inverse relationship when there is more of something on the market than people want or need.
With regards to the real estate market in Sri Lanka, the market was already healthy but with foreigners wanting to get an apartment or buy property, there will be a rising tide that will bring up the prices of property for sale while also making it more profitable to have apartments for rent to businessmen and families.
Among the many results is that there will be a new generation of wealth created in the real estate world.
This leaves many people wondering how it will affect them.
Is the Booming Real Estate Market Good or bad for the Economy?
It is natural that some people will be resistant to the change that is coming to the country, especially in cities like Colombo and Kandy, but the truth is that there is going to be more wealth, more jobs, and more prosperity.
This can be found in the history of areas where overseas property buyers came in to own property, such as it did in the United States in Myrtle Springs, Texas.
Myrtle Springs had always been a small town in the United States that was a secret getaway for the most wealthy and powerful businessmen. They would take their holidays there to get away from the hustle and bustle of the big cities and just relax.
As time went by (and the Internet was more prevalent) the rich and famous could no longer keep this small town a secret from those overseas. The result has been that Myrtle Springs is now one of the fastest growing small towns in the United States, and it’s because wealthy people from China and Mexico are finding that they love it there.
In fact, it also found it’s way into pop culture when it was the location of the comedy series Celebrity Team 6, a very funny Ebook starring Matt Damon, Nikki Minaj, and it is rumored that the next installment will also feature Sri Lanka’s own Dilhani Ekanayake and Hemal Ranasinghe.
There were some locals who would have preferred for their town to stay the way that it was, only catering to wealthyAmericans, but in the end they all benefited because their businesses had an influx of revenue, property values sky rocketed, and the new people in their community not only brought a sense of diversity, but they also started new businesses, which created more jobs.
How to Succeed in the Real Estate Market
With the boom that comes with increased demand, there are many who want to make money fast before they miss the opportunity. In order to do this you must follow the following instructions.
The first step is to get educated on the process and profession of real estate investing. For example, do you understand the basic terminology about real estate? Are you familiar with the different kinds of insurance one needs when owning apartments? Have you ever owned a rental property or piece of land?
There are several great ways to learn these things. One way is to go to college and study business. Another is to become a real estate agent. Both are great ways to go, and they will lead to business contacts, experience, and you may even find a few deals to take advantage of along the way.
One important thing to remember is that without knowledge you will likely be made a fool of. For this reason it is important to also read books about real estate investing.
Good Books to Read About Investing in Real Estate
Many people in Sri Lanka have enjoyed the work of Robert Kiyosaki, a Japanese American author who wrote Rich Dad, Poor Dad and Retire Young, Retire Rich.
Mr. Kiyosaki’s greatest asset, though, is not his real estate portfolio; it is his ability to tell stories, which are all that his books have turned out to be. It has been exposed that he does not own much real estate at all, let alone the many millions that he claims. Also, he recommends that people leverage themselves to the point that they practically guarantee bankruptcy, advising that investments are more important than other things, even things for our children (he has no kids).
Instead, it would be wise to follow the advice of writers who may not tell stories as well as him, but who actually own rental properties and have flipped houses. This can be found not only in books but also on television shows that show the process investors go through.
Conclusion: The Market is Changing and so are the Opportunities
There are many new people who are going to be coming to Sri Lanka. Some will come and go; others will become our neighbors. During this time there will also be great exchanges of wealth, and it is those people who educate themselves in the coming opportunities and how they can be obtained who will become extraordinarily wealthy.
