Why fortune will favour the brave in Asia's final real estate frontier;
Following three years of constant chatter and speculation about Myanmar being the final frontier in Asian real estate, I finally made it to Yangon this week to attend the second Real Estate and Urban Build Platform conference.
There was plenty of talk at the two-day conference about the potential of property investment in Yangon and elsewhere, although it is clear there is still a long way to go for foreign investors.
The key presentation on day one was from a member of the government on the new condominium law—until this is passed, there is literally no way for foreigners to legally own property in the country.
The Ministry of Construction representative who gave the presentation was admirably open to suggestions from the delegates on fine-tuning the bill, primarily inspired by the Singapore condo law, but this would suggest it is still some way off and the chance of anything emerging this year is rather remote.
One key aspect of the bill will be the restrictions on foreigners buying anything below the fifth floor. Whilst this seem perplexing to some, my host in the country, Brett Miller, managing director of Scipio Services, reckoned it was to prevent locals from being pushed out of Yangon's many low-rise properties should a boom come to town.
Years ago, Phnom Penh was considered to be the next gold rush town for ASEAN property. Yet this never really materialised; primarily due to the lack of strong economic fundamentals, foreign interest and enough locals with cash to transform Cambodia from an aid-dependant economy.
Whilst superficially similar to the Cambodian capital with its downtown colonial relics (it will be interesting to see if all the talk of renovation rather than replacement comes to pass in the former British colony), Yangon is a completely different proposition.
There's plenty of cash around, although most of it is currently in the hands of a tiny minority, and the massive demand has already pushed rents and land prices up to astronomical levels.
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