Affordability Crisis: Why is Rajagiriya the best place for an Affordable Apartment?
As property prices continue to climb amid tight supply and the evaporation of an economic downturn, renters now face the hard choice at renewal: pay the increased rent or find alternative housing. For many home renters the likelihood of finding a new home at a more reasonable price, physically moving and putting down a new security deposit makes the prospect that much more daunting.
In Central Colombo, the median rental rate on 2-3 Bedroom apartments are 21% higher from the 4Q of 2023, In 2019 the median rental was nearly 37% lower than what they are now the last normal market prior to the pandemic. Excluding Colombo 7, the median rental rate in Colombo is up an incremental 35% from this time last year. Still, there are great variations by submarkets & neighborhoods available.
Given the challenges, we identified the immediate suburb Rajagiriya to be the best location where renters still may find reasonably priced housing and upscale living.
Rajagiriya Topping Rental Yield Opportunity
If you are faced with a daunting price hike on your rent, your best bet is to look at a close substitute for Colombo city limits. Rental prices in Rajagiriya highrises are up 10% year-over-year, far less than the 35+% increases in all other Colombo markets & submarkets. Additionally, the median rental rate in Rajagiriya is far more affordable in comparison.
2023 | 2024 | |||
Development | 2-Bed Apartments | 3-Bed Apartments | 2-Bed Apartments | 3-Bed Apartments |
Capital Heights | LKR 200,000 | LKR 250,000 | LKR 250,000 | LKR 350,000 |
Iconic Galaxy | LKR 175,000 | LKR 220,000 | LKR 200,000 | LKR 250,000 |
Fairmount | - | LKR 200,000 | - | LKR 220,000 |
Fairway Waterfront | - | LKR 200,000 | - | LKR 220,000 |
Fairway Elements | - | LKR 300,000 | - | LKR 350,000 |
Clearpoint | - | $1,500 | - | $1,700 |
Notably, the top four most affordable rental apartments in Rajagiriya are all on the Buthgamuwa Road stretch. Fairmount & Fairway Waterfront are two of Rajagiriya’s first vertical spaces however they are the most affordable rental market in Rajagiriya and saw one of the smallest yearly increases in rent.
If you want to look a few tiers up on particular condos outside of Fairway Waterfront & Fairmount, head to Iconic Galaxy, their median rental rates, while up significantly, are both under LKR 250,000 per month and bridge the gap in terms of newness, affordability and convenience.
While Apartments like Clearpoint and Fairway Elements are expected to see rental rates rise at a more rapid rate in the coming years as they have in previous quarters , they are still at present the most compelling options for upscale renters who wish to reside on the luxurious side. Many of these neighborhoods also offer access to multiple roads, multiple schools and just a 5 minute drive from Colombo.
Written by Isaac Jasinghe
Isaac Jasinghe is a seasoned Property Consultant and Real Estate Advisor with 73 Avenue Realtors (Pvt) Ltd. With over four years of exemplary experience in the dynamic real estate industry, Isaac has facilitated numerous successful transactions, consistently delivering exceptional results. His expertise and dedication make him a trusted authority, guiding clients through complex real estate endeavors with precision and proficiency.
