What is a perch of land in Sri Lanka?

The main measurement unit in Sri Lanka is a perch. 1 Perch = 25.29 Sqm = 272.21 Sq Ft 1 Acre = 160 Perches = 4 Roods = 4,000 Sqm

What are property tenure/ownership?

There are two types of property tenure in Sri Lanka: 01. Freehold 02. Leasehold The terms of leases granted by the government and/or private individuals may vary and may depend on the purpose for which the land is to be used and the agreement between the parties.

How do I advertise my property?

To advertise your property for sale or rent with us is free of charge (Terms and conditions apply). You can contact us via info@southlankarealty.com to publish your property on our website.

How does purchasing a home compare with renting?

These two don’t really compare at all. The one advantage of renting is being generally free of most maintenance responsibilities. But by renting, you lose the chance to build equity, take advantage of tax benefits, and protect yourself against rent increases. Also, you may not be free to decorate without permission and may be at the mercy of the landlord for housing. Owning a home has many benefits. When you make a mortgage payment, you are building equity. And that’s an investment. Owning a home also qualifies you for tax breaks that assist you in dealing with your new financial responsibilities- like insurance, real estate taxes, and upkeep- which can be substantial. But given the freedom, stability, and security of owning your own home, they are worth it.

How do I determine the initial offer?

Listen to your real estate agent’s advice, but follow your own instincts on deciding a fair price. Calculating your offer should involve several factors: what homes sell for in the area, the home’s condition, how long it’s been on the market, financing terms, and the seller’s situation. By the time you’re ready to make an offer, you should have a good idea of what the home is worth and what you can afford. And, be prepared for give-and-take negotiation, which is very common when buying a home. The buyer and seller may often go back and forth until they can agree on a price.

What is the Real estate agent’s fee?

Typically 3% to 5% of the property value Generally paid by the seller. A buyer’s fee may apply if an agent acts as a buying agent. It is advisable to clarify at the outset whether the seller, buyer or both parties are liable for an agents’ fee.

What are the taxes that affect when buying a property?

There is a 1% Stamp Duty for leasing land up to 99 years. If buying a property, there will be a 3% Stamp Duty on the first 100,000 and 4% thereafter. A lawyer will typically charge 2-3% for preparing the documents.

What are the taxes for landlords?

Anyone leasing out a property to a foreigner or local will need to pay a 1% stamp duty when the rent is collected. The VAT is payable at 8% if the lease is to a VAT registered person, other than on residential premises. Further, the sale of land & buildings other than residential premises will also be liable to VAT at 8% on the value.

What are the taxes on possession and operation of real estate?

Assessment rates are payable to the local authority of the area where the land is situated. This would be calculated on the basis of an annual value given by the local authority after an inspection/valuation of the property. Assessment rates are payable quarterly. In addition, there are certain charges payable to the Urban Development Authority (UDA). However, UDA charges are not applicable to all premises and would be payable depending on the nature and use of the premises

How to apply for a residency visa?

A residency visa cannot be obtained by simply buying a property. However, Foreigners who invest over USD 250,000 will be allowed residence visas in Sri Lanka under the Resident Guest Scheme Visa program and anyone over 55 years old can obtain a 2-year renewable visa under the My Dream Home Visa Programme by depositing only USD 15,000.

How to move money in and out of the country?

If a foreign resident wants to purchase a property, then the money will need to be channeled into the country via a special SIA (Securities Investment Account), held at a local bank. Once the property has been sold, the money can be taken out (plus any gains) via the same account in the currency that the money was deposited in. If you currently own a property where the money hasn’t been brought via a SIA account (eg. inherited, bought while a citizen of Sri Lanka), then there’s an annual limit of $20,000 when taking the money out of the country. You could still take the money out at once if the source of the money can be proven to the bank and Central Bank (this whole process will take a few months to complete). The government will allow $45,000 to be brought in to the country without declaring the source (Budget 2017) The budgets of 2017 & 2018 have proposed that foreigners be allowed to borrow money from local banks for the purchase of condominiums (up to 40%).
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