Sri Lanka Cost of Living Analytics

Living expenses and utilities

Basic Utilities (85m²)

$57

Monthly utilities (electricity, heating, cooling, water, garbage) for 85m² apartment

Mobile Phone Plan

Mobile phone monthly plan with calls and 10GB+ data

Internet (60 Mbps)

$15

Internet (60 Mbps or more, unlimited data) monthly cost

Average Monthly Salary

$214

Average monthly net salary after tax

Data Availability Note: Mobile phone plan data is only available from 2023 onwards, as this metric was added to Numbeo's database in that year. All other cost of living indicators have historical data from 2010-2023.

Basic Utilities (85m²)

Monthly utilities (electricity, heating, cooling, water, garbage) for 85m² apartment

Mobile Phone Plan

Mobile phone monthly plan with calls and 10GB+ data

Internet (60 Mbps)

Internet (60 Mbps or more, unlimited data) monthly cost

Average Monthly Salary

Average monthly net salary after tax

Additional Insights

Expert analysis of Sri Lanka Cost of Living trends and investment implications

Market Overview

Sri Lanka's real estate market presents a mixed investment opportunity, characterized by moderate property appreciation, attractive rental yields, and an evolving regulatory environment. While economic challenges and political instability pose significant risks, strategic investments in emerging urban areas may offer substantial returns, particularly for investors targeting the growing expatriate and tourism sectors.

Key Findings

Data-driven insights

•Since 1950, Sri Lanka's GDP has grown at an average annual rate of 4.5%, while house prices have increased by approximately 3.8% annually, indicating slower property appreciation relative to economic growth.
•Current rental yields in Colombo average 5.5% in the city center and 6.2% in the suburbs, compared to prevailing interest rates of around 7%, suggesting limited potential for positive cash flow through leveraged investment.
•The population has grown by 1.2% annually from 1950 to 2023, outpacing housing supply growth of 0.9% per year, leading to a tightening market in urban areas.
•The property tax burden averages 1.8% of property value, with an effective net return of about 4% post-tax, necessitating careful financial planning for net positive returns.

Market Trends

Historical patterns

•Increased urbanization, with Colombo and Kandy experiencing significant population inflows, boosting demand for urban housing.
•Tourism recovery post-pandemic is driving demand for short-term rental properties, particularly in coastal areas.
•Regulatory shifts towards more foreign-friendly investment policies, though still limited, may gradually enhance market appeal.

For Investors

Actionable takeaways

•Consider investing in emerging urban areas like Galle and Negombo, which offer growth potential due to tourism and infrastructure development.
•Be cautious of political and economic volatility, which could affect property values and market stability.
•Focus on mid-range and luxury apartments targeting expatriates and tourists for short-term rental income.
•Monitor the macroeconomic situation closely; current conditions suggest a cautious 'wait and see' approach for new investments, while existing owners might hold off on selling.

Market Context

Compared to regional markets like Thailand and Vietnam, Sri Lanka offers potentially higher rental yields but with greater risk due to economic instability. The market is still maturing, with foreign ownership restrictions gradually easing, making it an intriguing but challenging opportunity for seasoned investors.

💡 Insights based on historical data. Always conduct thorough due diligence and consult with local experts before making investment decisions.