RANGOON — Contrasting expectations have emerged from Burma’s real estate industry as the National League for Democracy-led government attempts to persuade more foreign investors to enter the country’s market.
After State Counselor Daw Aung San Suu Kyi’s visit to US last week, marked by President Barack Obama’s promise to lift economic sanctions on Burma, some of those working in property development described experiencing new hope for their sectors.
“The real estate and construction market is developing rapidly,” said U Kyi Lwin, a member of the Myanmar Engineering Society, at a press conference on Thursday for the upcoming Myanmar Build & Décor Exhibition, scheduled to be held in Rangoon in early October.
U Kyi Lwin cited reports that total investment in real estate and construction had reached US$8.2 billion in 2015 and it is expected to increase to $13.5 billion by 2020.
But while rapid growth in Burma’s real estate market is expected by some, many are still waiting to see results, said U Than Oo, managing director of Mandine Real Estate Agency.
“The construction and real estate market is still cooling down, as demand is low due to the slow economy here since last year,” he said, predicting that “FDI [foreign direct investment] will not come rapidly to the country. I don’t think many investors will come [in the near future]—the market situation is not good at the moment.”
Demand is down, too, U Than Oo said.
“Some say the real estate market has gone back to normal because of the country’s change, but its not true: the market is still declining even though prices are not going up,” he said.
U Myo Myint, managing director of MKT Construction Co., said he feels that a rapid change in governmental policies on construction could harm the industry and concern foreign investors, who fear a market stagnancy later down the line.
The new government, he said, has abolished some construction policies practiced by the previous government, which he said could deter potential international partners.
“If every new government fulfills the pledges of its predecessors, potential foreign investors will not be hesitant to invest,” U Myo Myint said. “No government will be in office for eternity. There will be changes. We don’t mean that policies should not be changed, but if they take effect retroactively, there will be negative impacts,” he added.