Things have been changing fast in Myanmar and they show no sign to stop soon. The government has been opening the country to the world (think of the new possibility to apply for a Myanmar visa completely online in minutes) and implemented extraordinary political and economic reforms.
Myanmar was long under dictatorship and considered a difficult country to invest in. But after the first elections in 2007, progress has been on everyone’s mind in Myanmar, with what could be important advantages for the real estate market.
On this page, readers will find an introductory guide to Myanmar property for foreigners. You’ll learn about:
The current economic scenario in the country
Property law and taxes in Myanmar for foreign citizens
Where to buy and invest in real estate.
Keep in mind that this is an introduction only. Before you decide to make a commitment, you will have to seriously consider your specific circumstances and research the conditions for investment in depth.
Is Myanmar a Rich or Poor Country?
Gone the days of the military junta, the new Burmese democracy has taken a great leap forward. During the past 10 years, Myanmar has turned into one of the fastest-growing economies in the world with an average 6% expansion in GDP and the ability to not being impacted by the 2008 Global Financial Crisis at all.
On top of that, the country enjoys a unique strategic position (it borders China and India) that promises great advantages.
Can Foreigners Buy Property in Myanmar?
Just a few years ago, the answer would have been a categorical no. Until recently, it was not possible for foreigners to buy land or property in Myanmar because of the Transfer of Immovable Property Restriction Law. However, things have changed radically.
In January 2016, Myanmar’s Union Parliament passed the new Condominium Law. Now, foreigners are allowed to purchase properties although limitations apply.
Myanmar Property Law for Foreigners: the Condominium Law
In order to be sold to non-Burmese citizens, a building must be registered as a condominium. The qualification and registration must be approved by the Ministry of Construction.
The condo must also be built on a collectively owned parcel of land at least 20,000 square feet in size. And similarly to the Thai property law, the total foreign ownership in any development can be of up to 40% of the project.
Foreigners cannot buy land for now but can sign up for a long-term lease.
Although these may seem like strict limitations for those used to more open markets, remember that the Condominium Law is an important first step forward giving all the impression that things are going to improve even further soon. It won’t be surprising if many of the above restrictions will be lifted in the next few years.
Finally, although not a legal restriction in itself, foreigners may find the Burmese financing scenario to be very different from what they’re used to. The banking sector is booming and more foreign banks are being licensed by the minute. However, don’t forget that until not too long ago, the norm for buying houses in Myanmar was to pay cash.
Obtaining financing as a foreigner is not an option for now. You will be expected to transfer funds from abroad in order to buy your condo.
Property Taxes in Myanmar for Foreigners
Foreign citizens who are not residents of Myanmar will see their rental income taxed at a progressive rate between 0-25% based on their annual income. It’s important to notice that a foreign investor’s salary will probably place them at the higher end of the range.
Stamp duty on rental income also applies after the tenant has moved out, depending on the rental period, and can be between 1.5-3%. Stamp duty also applies after selling and amounts to 7% in Yangon and 5% elsewhere.
Where to Buy Property in Myanmar
Because of the restrictions set by the Condominium Law, there are very few properties at the moment that qualify for foreign investment. As mentioned before, this is bound to change in the next future.
It’s very likely that you will find qualifying and top-quality properties mostly in Yangon, the largest city and commercial center in the country. Construction sites are popping up all over town and foreigners will be able to make the best of them. If you’re thinking about investing in Yangon, get your passport and valid Myanmar visa ready and check out areas like Dagon, Bahan, and Botataung.
* This is a contributed article and this content does not necessarily represent the views of realtytoday.com
