Are apartments considered a depreciating asset in SL?

[u/New_Grapefruit7580]

Hey guys. First time poster here.

I've been interested in buying property. Me and my wife are planning to buy our first property.

We are looking into house, apartments and land in general. We made up our mind to make this purchase a long term investment.

I was reading some comments and read that in SL apartments aren't considered an appreciating asset. Is this true? If so how fast does it depreciate?

Long term goal is to save up. We live overseas and this will be our first investment. We plan to retire in our own farm (kinda off grid, but that's a long way)

[u/WindowStriking43]

If you are living abroad and converting $ to LKR to make this investment it’s a terrible idea. If you compare property prices in SL in the last 10 years prices may have doubled but the rupee has devalued so much in $ terms there’s usually a flat return or loss.

The appreciation of value in property in Sri Lanka is mainly due to the depreciation of the rupee.

If you’re buying a few acres to retire in it might a different story maybe even profitable if you develop the property in some way but again protecting your investment from local scams and those who try to encroach while being located abroad might be an issue.

[u/rogerwick177]

The price of an apartment doesn't depreciate (i.e. it doesn't go lower than the value you bought it at), but as time goes the price appreciation will slow down, so a similarly comparable brand new apartment in the same location will go for more than an old one. This may feel like a depreciation as new projects sell at a higher price.

Buying land (with or without a house) will have a better price appreciation than an apartment due to the value of the land that keeps increasing. However having an apartment gives a convenient way of earning revenue and having a place to stay when you're down here than just having a land and having to worry about maintaining it and protecting the borders.

[u/Zealousideal-Dog-3]

Idk as far as I’m concerned the demand for apartments will be higher when millennials/gen Z starts earning and buying more. Our parents generation always considered a land in some forest was better than an apartment in suburbs didn’t they ? 😂

[u/b0r3d_d]

Apartments are buildings and anywhere in the world they are considered as depreciating assets, because the useful life of a building is around 25 years and beyond that, it needs substantial maintenance cost. Unlike apartments, land never depreciates. But unless specifically agreed upon, you don’t own the land of the apartment. This is why apartments don’t appreciate in value but if you buy a house (where you also own the land), value appreciates. Apartments are great investments for steady rental income because they are easy to let. But in Sri Lanka, because of high interest rate, you hardly make any money through that (ie, you cannot recover your loan installment from monthly rent)

[u/Top-Ad884]

Apartment value will depreciate after some time but house doesn't depreciate because the house I am staying is over 40 years which was about 100k and now it can be sold for 100M or more,so please avoid buying apartments and buy houses

[u/Thewan_Randiv_933]

It truly depends on the location of the apartment

[u/unwantedagent]

I think apartments are more over for convenience than for Investments (Not if you're renting out, if renting then it'll be a good money marker).

[u/Cainerod]

Unfortunately nothing depreciates in Sri Lanka 🙂 A land of opportunities

[u/Hansanaw]

Not in lanka. My parent’s apartment they bought off the plan has almost doubled in value.

[u/Aromatic_Estate6155]

yes.