Renting a Property in Yangon

Renting a Property in Yangon

WHAT YOU NEED TO KNOW

The propertymarket in Yangon is still catching up with the rest of South East Asia.The supply of properties exceeds the demand from international clients, but the number of properties in the rental market that meet international standards are in limited supply. We expect this to change over time, however the poor quality construction standards and lack of knowledge of international property standards by local owners mean you can’t bring the same expectations for property to Yangon that you could to Singapore, Bangkok or even Ho Chi Minh. This makes the property market very challengingto find suitable accommodation. This article highlights some of the main challenges and what you need to expect in each rental bracket.

Real Estate Agents and Commissions

Anyone can be a broker in Myanmar and the market is not yet regulated. Market practice is for brokers to charge a 1-month commission if you choose a property, however there are different agents offering different schemes.

Contract Periods

For foreigners, the longest and most common recognized contract by law is 1 year. However, the length of contracts does open up the risk of rent hikes in the second and subsequent years. Efforts can be made to write in first right of refusal to extensions, and to minimize rent rises to a percentage.

Rent Payments

It is standard for rent in Myanmar to be paid in advance for the entire period of the contract. There is a risk that once the rent has been received that landlords will become unresponsive to any subsequent issues that may arise.

Making payment to landlords can be challenging for corporations, as often landlords will want to accept cash only, and will often only take payment in US dollars, but will very rarely have a US dollar bank account to accept payment by wire transfer. Happily, the landscape is changing – more landlords are accepting more flexible payment terms, and Myanmaris trying to move away from a reliance on the US dollar, and encourage the use of its own currency.

Deposits and Cancellations

Usually a one month deposit is requiredto secure the property, and a pre-lease agreement will sometimes be signed. The deposit will be used towards the total rental fee due – for example, for a one year lease, the total amount payable will be 1 month deposit paid in advance, plus 11 months’ rent to be paid when the tenant moves in.

Early terminations are generally not accepted, and any rent paid for the remainder of the contract period will be forfeited. Efforts can be made to write cancellation clauses into contracts;however it is not market practice and landlords are unlikely to agree to such terms.

Furnishings

Most properties are furnished, or negotiations can be made to have them furnished. However, the furnishings provided by landlords may not be modern, andare of variable quality. Some landlords will allow the tenants to choose their own furniture atlocal stores.

Appliances

Depending on the rental level you choose, many appliances maynot be provided as standard and would need to be negotiated with the landlord. This would include air conditioning units, water heaters, stoves, refrigerator, washing machine and clothes driers. Apart from the high end rental properties, ovens and dishwashers are generally not included.

Utilities

Utilities are generally not included in the rental price, unless the property is a Serviced Apartment. Eventhen, it is common for maximum limits of coverage to apply. For condominiums with a building management team,the utility payment could be made in cash at the management office. Otherwise, tenants will have to arrange payment at the local utility board office.

Cable TV and Internet

Negotiations could be made to get cable TV and internet services installed at the property. However, the cost of the services would not be included in the rental amount. Depending on the situation, payment may be collected by the building management team, or in other cases separate vendors would come to the door for cash payment. Internet connections and networks are not always stable.

Electricity

There are often power cuts in Myanmar, hence having an inverter/a backup generator is very important in negotiating the lease. Modern condominiums and higher end properties should already have these.

Insects and Pests

Insects and pests including cockroaches are a part of life in Yangon and are found in almost found in almost every price level. Mosquitos’ can be very bad during raining season.

Rental Price Guide
Up to $1,500per month

Properties in this price bracket will either be further out of town, or offer very basic amenities, or both! The properties are likely to be older and lacking in basic western conveniences such as separate showers and toilets; limited or no hot water; and missing kitchen appliances such as built in stove tops. They are also likely to be located very close to neighboring apartment blocks. Inverters/backup generator will not usually be included in this price bracket as standard. One also needs to expect that there will be some on-going maintenance issues with water leaks, water pressure or water drainage.

USD $1,500- $3,000per month

Options in this price range will be mainly condominiums of 130- 200 square meters in size (roughly 1,300- 2,000 square feet). They are usually be 3 bedroom units, or sometimes 2 bedrooms and do not include a storage room/maid’s quarters.

Toilets will generally be western, but in most cases will also be where the shower space is. The shower space is unlikely to be closed off, and drainage tends to be poor, meaning that once you have a shower your whole bathroom will be wet.

Kitchens will be limited to cold running water only.Electrical stoves are more common than gas stove. In most cases this will be propane gas, and you will need to find a space to put the gas bottle within your kitchen.

Rooms will tend to be quite large and as spacious as western homes in most cases, but air conditioning of all the spaces might be a challenge in the hot periods of the year.

These properties have been built by locals and quite often lived in by localsuntill the properties are up for lease, there will often be a “prayer room” in the property that houses a portable Buddhist alter. Often this will break a decent sized room into two, leaving a less than desirable floor plan for foreign tenants.

USD $3,000- $5,000 per month

Many of the challenges that exist in the above budget range still exist in this range, but there are more options to choose from.

Condominiums

Will be a little larger in this budget range; probably well in excess of 200 square meters or 2,000 square feet, and they probably will have rooms for storage and maid quarters. Due to the higher monthly premium, the quality of these properties is likely to be slightly higher, and they may contain more appliances.

Detached Houses

Begin to become available in this budget range. For houses in this budget range, you need to expect everything mentioned about maintenance issues in the lower budget range; issues to do with hot water heating, power cuts and the response of generators (often these houses will not have generators), insects including cockroaches, internet connections, water pressure, water leaks or water drainage.

Serviced Apartments

While there is limited inventory in Yangon currently, options begin at the top of this range; from $4,500.00 per month upwards. The “Sakura Residences” and “Golden Hill” serviced apartments start with one bedroom units in this range, and if you are willing to compromise on the commute, the Pun Hlaing Golf Estate and the Star City Housing Complex are also options (Star City also has options in the $1,500- $3,000 range). With serviced apartment options, you simply will not need to worry about most of the maintenanceissues commonly encountered. However, especially in the Yangon City locations, availability is quite scarce in most serviced apartment properties, although as time goes by there are a growing number of options in lower budget ranges.

** Please see Myanmar Relo Services for more information on Serviced Accommodations

USD $5,000.00- $10,000 per month

Many of the challenges that exist in the above budget ranges will exist in this range also, although generally the quality of property will be much higher, and the size of the properties much larger. While there will still be some condominium options in this range, predominantly options will be Stand Alone Houses.

Stand Alone Houses

For houses in this budget range, you are not going to lack anything in terms of space. It would be common for properties to be 300 square meters (3,000 square feet) or larger and many rooms with an on-suite. You can expect many of the same issues with regard hot water heating, power cuts and the response of generators, insects including cockroaches, internet connections, water leaks or water drainage, etc., but much of this will come down to the staff you employ to look after these kind of issues. Considerations will need to be made on how to staff for cooks, cleaners and security of your property. Guards are likely to be needed on your gate, and due to the size of the properties at least maids will be required for cleaning and upkeep of your house. You may also require gardeners for the outside areas. While such staff could be arranged through the owner, making such negotiations would not be recommended, rather it would be best to engage a reputable firm that supplies maids and security staff and has done the necessary due diligence in terms of background checks, etc. While Yangon is generally a very safe place and the majority of the population is very honest and respectful, you must not become complacent about security issues. Often it is the additional burden of staffing your home that turns people against a large home in Yangon, and instead sees them choose serviced options in the following section.

Serviced Apartments

While there is limited inventory in Yangon currently for this budget range also, you will find the top-of-the-range serviced apartments in this bracket. “Shangri-La Residences” the larger rooms at “Golden Hill” and the penthouse option at “Pun Hlaing Golf Resort” are all in the $6,000- $8,000 price range. Prices do differ depending what you wish to have included in the monthly rent (eg. often electricity charges or club-house membership maybe outside the monthly fees), but the advantage of serviced apartments over regular condominiums or stand-alone houses is always going to be that you don’t have to worry about the maintenance issues mentioned through this document.

** Please see Myanmar Relo Services for more information on Serviced Accommodations

USD $5,000.00- $10,000 per month

Many of the challenges that exist in the above budget ranges will still exist in this range, although generally the quality of property will be much higher, and the size of the properties much larger. While there will still be some condominium options in this range, predominantly options will be detached houses.

Detached Houses

For houses in this budget range, you are not going to lack anything in terms of space. It would be common for properties to be 300 square meters (3,000 square feet) or larger and many rooms with an en suite. You can expect many of the common maintenance issues but much of this will come down to the staff you employ to look after the property.

Considerations will need to be made on how to staff for cooks, cleaners and security of your property. Guards are likely to be needed on your gate, and due to the size of the properties at least maids will be required for cleaning and upkeep of your house. You may also require gardeners for the outside areas. While such staff could be arranged through the owner, making such negotiations would not be recommended, rather it would be best to engage a reputable firm that supplies maids and security staff and has done the necessary due diligence in terms of background checks, etc. While Yangon is generally a very safe place and the majority of the population is very honest and respectful, you must not become complacent about security issues. Often it is the additional burden of staffing your home that turns people against a large home in Yangon, and instead sees them choose serviced options in the following section.

Serviced Apartments

While there is limited inventory in Yangon currently for this budget range, you will still be able to find the top-of-the-range serviced apartments. “Shangri-La Residences” the larger rooms at “Golden Hill” and the penthouse option at “Pun Hlaing Golf Estate” are all in the $6,000- $8,000 price range. Prices do differ depending what you wish to have included in the monthly rent (eg. often electricity charges or club-house membership maybe outside the monthly fees), but the advantage of serviced apartments over regular condominiums or detached houses is that you don’t have to worry about the common maintenance.

** Please see Myanmar ReloSolutions for more information on Serviced Accommodations

Coming Developments

There are many developments under construction in Yangon, but for the most part their completion schedule has not been finalized.
It is expected that many more developments will be ready by late 2016 through 2017. Until then, there is going to be shortage of good quality property options in Yangon, and due to the demand for serviced apartments, assignees are going to need to compromise between locations and modern comforts in selecting long term accommodations.

For further information on questions about the housing market in Yangon, please contact Myanmar Relo Solutions (MRS) at anytime.

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