Notes on land pricing in Sri Lanka

We’re most qualified to talk about the price of beachfront land on the South West coast and reaching into the Deep South, a little beyond Tangalle. It’s this stretch of coastline that buyers we work with are most interested in (for now).

Along that ‘strip’ prices have, historically, been highest close to Galle - the traditional tourist hub of the Southern Coast. Bare land prices here are now in the region of 5-6m Rupees per perch (there being 160 perches in an acre) on relatively small plots, anything up to, say, a quarter of an acre. 

That number would give you an acre for a little under $3m so clearly a very significant investment - and one you’d likely need some good commercial logic for. In most (sensible) cases, however, larger plots will come at a discount to the often-quoted ‘perch price’.

As you move further down the coast, away from Galle and with further travel time to Colombo and the International Airport just north of it prices have tended to drop quite consistently. If you imagined a line heading East from Galle and reaching Hambantota in the South Eastern corner you could quite reasonably expect beach land pricing to be half this level (say, 2.5m per perch) half way along, around Talalla, and then considerably lower (for now), say 500,000 per perch once you get past Tangalle. 

So in USD terms, where you’ll be paying upwards of $2.5m for an acre of beach land close to Galle, you can expect (or at least hope) to find an acre for around $250,000.

As some ‘hotspots’ have emerged away from Galle in recent years that straight line price assumption has warped somewhat. In places like Ahangama, Madhia, Mawella and Hiriketiya, prices have jumped more quickly. Now, beachfront land - hard to find - in Ahangama or Hiriketiya is priced quite closely to that very close to Galle.

Again, it’s a vague category, and prices will vary massively depending on where on the island you’re looking. Prices of course, though, drop quickly as you move away from the beach and with more supply (in theory) there’s slightly less sensitivity to excitement over new ‘hotspot’ locations. 

That trend, though, of land being priced most highly close to Galle and then dropping as you move East, with a few hotspots dotted along the stretch, does still apply to some extent. In the locations mentioned above you might make a rough assumption that bare land within a walk of the beach prices at between 20-30% of what its beachfront counterpart might list for. Land that’s a drive to the beach (say, no more than 15 minutes) would perhaps list for 5-10% of the price.

As mentioned above, we’re talking here about land that would be suitable for our clients, typically people that want to develop a beautiful private villa/home, or a commercial hospitality-related property.

So…once again…if you’re looking at land close to Galle, in Ahangama, or Hiriketiya (all prime spots!)…you might assume that half an acre (80 perches) within a walk of the beach will be in the region of USD 400,000. An attractive, prime half-acre plot that’s a drive to the beach would reasonably price at USD 120,000.

If making generalisations about beach or ‘coastal’ land was hard, doing so for land in the hills is almost impossible. 

Reasonably sized Hill Country land, or other inland plots, will often have some agricultural function - tea, rubber, coconuts etc. - and so the economics of that use plays a part in valuation. Some estate land will also have a ‘bungalow’ or even a factory for which sellers make due consideration in any sale price.

Hill Country land also tends to be dealt with in much larger parcels and when you’re dealing with plots ranging from an acre to 200 acres it’s impossible to generalise without listing out a miserably long list of scenarios. 

Access (which can vary hugely), infrastructure potential (water, electricity), vegetation and views can all also impact pricing - and be critical elements for our buyers.

So to give the vaguest of indications…we are currently listing a ‘wild’ 45 acre estate bang in the middle of the island for in the region of USD 300,000 (so around USD 6,500 an acre). Planted tea estate land, with no other real assets (i.e. a house or factory) would perhaps reasonably price at around double that. Add in an ‘historic’ bungalow, some amazing views, a waterfall etc. and you’d have to more than double that again.