Yangon property market, especially for resale properties, has just waken out of doldrums, but not for good reasons. Inability to withdraw cash from commercial banks has left many depositors with hundreds of thousands of dollars worth of deposits in local banks, especially for customer with privilege banking or similar status.
There is no way to alleviate their fears over bank failures other than taking out the money from that bank. With nil possibility of that, the only other option left is to convert the cash into hard assets such as property. Property resale market is flushed with advertisements where it includes payments via bank transfers. Sellers can get more if they accept bank transfers and much less with physical cash. For people who have been waiting a while to unload their property, it seems a good way to get rid of the asset probably to pay off loans, through contra/offset with the deposited amounts from the sale of the property. Interbank transfer service is available at this point of time among banks.
For those with smaller bank balances, cars are also the asset of choice. Japanese and Korean models are in higher demand. Cars are sold at much discounted prices, compared to properties.
Unfortunately the take up rates at new condominium and apartment have not increased. Interviews with major condo developers revealed both the project and the sales had halted in the past three months. The same goes for the leasing market. Unscrupulous tenants are running away from their obligations to the landlords, through the frivolous use of the ‘force majeur’ term, using it as an excuse to rescind from the rental contracts.
Rental market is extremely negative, especially at higher end, as most expatriates went home after the military takeover. Office rental market is not spared either. Most companies are downsizing. Some have closed off for good. F&B rental market is picking up as more restaurants and food establishments re-opened in May. May be an additional push to open came from being one of a few industries which can collect physical cash from customers.
