What’s the price of beach land in Sri Lanka?
6th November 2023
We’re regularly asked what’s the price of beachland in Sri Lanka and it’s not an easy question to answer succinctly; beachland really not being a commodity you can whack a standard price per unit on. In Sri Lanka, as, I’d assume, almost anywhere else, the ‘quality’ of a piece of beach land will vary according to any number of factors - width of the beach itself, length of beach frontage, size of the plot, general topography, access, location, vegetation, how swimmable the ocean is at that point. And that’s before you even dip into manmade factors like development, tourist popularity - not to mention issues around title certainty and local politics.
Just jotting those down one’s inclined to think beachland might be the most nuanced of real estate asset classes out there. However, we all like a simple story and so it is that we submit to cite price per perch* numbers for beach strips up and down the Sri Lankan coast, knowing full well we’re having to ignore the subtleties of any individual plot.
So what are those numbers, how are they shifting and do they represent decent value?
In terms of beach land for sale in Sri Lanka, our focus of late has been from Galle moving East along the coast reaching as far, generally, as Tangalle. Close to Galle itself, perch pricing on beach land for sale typically starts now around LKR 4.5m a perch on the smaller plots - anything, say, under a quarter of an acre, being 40 perches. We’ve heard of plots being quoted at significantly higher levels but anything between 4m and 5m a perch is probably in a reasonably sensible bracket.
From Galle the perch pricing drops as you head further East along the coast but with pockets of higher prices. Beach land plots for sale around Weligama, Ahangama (ever more popular) and Midigama are spoken of now in that LKR 4-5m a perch range - occasionally higher.
Other than those hotspots, pricing in fact would show a relatively straight-line graph plotted against distance from Galle. Again, a little further down the coast, we’ve been involved on small beach land transactions close to Matara at LKR 2.5m a perch.
Keep going and you get to Tangalle and beaches around, say, Mawella, where there’s a sort of implicit assumption that beachfront land trades LKR 1.5m a perch. That particular number is the one probably most due a bit of revision, the extended Southern Highway now greatly lessening any premium you might have attached to plots closer to Galle.
It’s only really past Tangalle now that you can consistently find good beach land for sale at less than LKR 1m per perch.
In terms of pricing shifts there seems always to be a gradual creep upwards. When the rupee devalued sharply against the dollar it didn’t take long for the LKR perch price to jump but otherwise, after the climb that came following the opening of the highway, it’s been a quite consistent appreciation.
We suspect, though, that in the next 12-18 months we’ll see a slight leveling off between valuations in that hub around Galle and those further down the coast. The almost 5 times premium for beach land close to the Fort relative to plots around Tangalle really isn’t justified any longer - more Eastern plots will surely appreciate quicker and narrow that gap.
As to whether these prices represent decent value, well we’re rather duty-bound to say yes! But should add that any value in bare land, of course, will be a function of what you make of it. Some of the beachland pricing in hotspots like Thalpe or Habaraduwa will make it difficult for anyone to see good value without taking a commercial view. Most these days do - and owners of gorgeous villas can make healthy yields that seem to justify, on an income basis, the higher pricing.
Get down to strips past Matara and we think there’s still very good opportunity for a would-be value investor.
*a perch is 25 square metres - giving 160 perches to an acre.