A country full of exotic sceneries, multicultural destinations, and extraordinary lands, Sri Lanka quite lives up to the name “Wonder of Asia”. The diverse climate range of Sri Lanka creates a very opportunistic instance for anyone deciding to buy property here, as there is a wide variety of options to select from adhering to your personal preference. If you are a foreigner, selecting the right property to invest in can be quite a hassle. That is why thought to help you navigate through the legal background of property investing in Sri Lanka. 


As introduced above, Sri Lanka can be the home of your dream site depending on any of your liking. From the breezy beachfront, the dewy jungle, and the scorching dry lands to the bustling cityscape, Sri Lanka has it all. The exclusivity of each destination creates a significant demand for property in Sri Lanka. But, the main shortcoming of investors is the limited knowledge on the value of property investments. This helps foreign investors to take rein in property investments.


The main law that helps foreign investors purchase freehold property in Sri Lanka is Land Act no: 38 of 2014. This allows the investor to buy, build, rent, and sell the property while making a considerable amount of profit. The basic procedure under this act states that, when a foreign investor purchases a property in Sri Lanka, they are required to do so through a Sri Lankan company structure. They should also involve a lawyer as a trustee under the company. The investor can totally control the company.

The property purchase is tax-free but the other additions such as a Stamp duty of 4%, capital gain of 10%, and a dividend tax of 10% are added to the expense. The expenses also include company incorporation, trusteeship security, legal setup, and lawyer’s fees.

The Foreign Exchange Act No 12 of 2017 also helps with lesser taxation on the properties of foreign investors to expand liberal exchanges.


Foreign investments in certain areas such as Sri Lankan exports, mining, timber industry, deep-sea fishing, travel and shipping agencies, and freight forwarding will be only approved up to 40% of the stated capital by the Board of Investments in Sri Lanka.

The main thing to note is that when the investment is done through an IIA, it can be easily repatriated into home currency. This can be helpful in capital transactions and profits being exchanged into home currency.


The Land Act of 2014 was amended in 2017 to allow foreign investors to lease land for up to 99 years. This fact is very crucial as it can be advantageous to investors in many ways. Rather than purchasing property, land can be leased in order to get maximum benefits for the investor. This allows them to lease the land without any specific additional tax. It also has a lesser stamp tax than the purchase of the property. Additionally, leasing also gives the foreign investor the ability to repatriate the Sri Lankan Rupee. For any foreigners looking for property in Sri Lanka, leasing is the best and most efficient option as this will cost a lot less and put you through minimum processes.


After learning about the serious legal information, it is important to get some local advice on how to prevent yourself from being swindled while hunting for luxury properties in Sri Lanka. It is very essential as a foreigner to be familiar with all the laws pertaining to property investment as this is the major way how people get tricked into spending massive amounts of bribes. You should never pay any amount of money for any party to work around the law as it is impossible and illegal. got you covered when it comes to connecting you with reliable and experienced property sellers around the country.


The reason for investment can vary from individual to individual, and Sri Lanka has the perfect destination for all possible needs. If you want to get into hospitality with your property, then beaches are the best bet. There are breathtaking remote locations like Kogalla and Aluthgama. World Heritage tourist attractions like Galle, Bentota, and Hikkaduwa. If your taste is a bit wild, Sri Lanka has thick forest areas like Ella, Sinharaja, and Kitulgala. Catering to every need, Sri Lanka can give an investor the best experience of owning a property and the best thing about it is that investing in Sri Lankan property is not that difficult.

The legal side of property investment is not as hard as it looks, after the many incentives provided by the Sri Lankan Government to improve the economy; it is easier than ever to purchase your own safe haven in the Pearl of the Indian Ocean. 

Why green real estate is the way forward?

Technology revolutionized human history. Evolving new innovations dragged away the humans from nature leading to many global problems decades later. Once the world realized the importance of balancing development and the environment, sustainability became a hot topic in every industry. Now each and every business sector around the globe are attempting to embrace sustainability at its best capacity. Green real estate is the sustainability-conscious solution in the real estate industry. 


  1. What is green real estate?

Green real estate is properties that are developed to be more durable with a lesser carbon footprint compared to other traditional properties. They are also believed to be more health-friendly for the occupants. There are three main factors that help to decide if real estate is green real estate. 

  • It is capable of improving the quality of the life of the occupants while smoothly blending with the climate and ecosystem of the locality. 
  • There are measures to conserve energy and other resources throughout the lifecycle of the building.
  • From the start of the construction, there is a commitment and a plan to reuse, recycle and reduce the resources.   

  1. Why green real estate is the way forward? 

Global warming, climate change, and other environmental concerns have forced people to pay attention to the impact of their life on nature. In the modern information era, people are more and more aware of how they contribute to the global environmental crisis and how these environmental problems can affect their future. This is why sustainability has become a priority factor considered when investing in real estate and in other choices people make in their day-to-day lives.   

Research conducted in different countries shows that, 

  •  The second biggest factor affecting a person’s decision to purchase a property is the energy efficiency of the building. 
  • People are willing to pay more for real estate that is more sustainable and eco-friendly. 
  • A building’s ability to conserve energy or use of renewable energy can increase the value of the property considerably. 

The love for eco-friendly real estate is not a concept developed by the property developers themselves. It was an answer to the rising green trends in the world which have spread to almost all the industries in the world. The real estate investors are willing to prioritize green properties over traditional properties and the real estate developers are meeting that demand. 

The laws and regulations in regards to the sustainability standards are also actively updating at present. Starting from the Paris agreement which came into effect in 2016, sustainability regulations are increasingly becoming important to real estate developers and investors. There are certifications emerging in the industry that ensure the level of eco-friendliness of the properties.  

Therefore, green real estate is an investment with a promised future. Now you have the opportunity to invest in green real estate in Sri Lanka. But you must be careful that the real estate you invest in is genuinely eco-friendly and sustainable. You can find out the green real estate available for sale in Sri Lanka through the luxury real estate website which assures the reliability of the dealers and your convenience. 

  1. How to exploit the benefits of green real estate? 
  • Efficient energy usage

Occupants of a house spend a considerable percentage of their monthly expenses on heating and lighting their building. When purchasing a property or land aiming to reap green benefits, you must consider the availability or the potential for renewable energy sources such as solar energy. 

The land or the building must be spacious enough to facilitate a natural flow of light and heat. If your surrounding requires you to block the light or heat from outside, the houses must be planned or renovated accordingly. It is easier to cut off the energy expenses when buildings are built to receive the maximum heating or lighting naturally.

  • Blending in with the natural environment 

When buying a property or building a house of your own always go for the eco-friendly option. A little change you make in the construction process may help you to reduce your carbon footprint to a great extent. You should have a thorough understanding of how your construction materials are sourced and their impact on the environment. The materials you use on your building must be healthy for the occupants as well as being environmentally friendly. 

Green properties must blend in with the ecosystem it is situated in instead of rising above it. Do not spend on landscaping and gardening which changes the natural landscape of your land. Instead, allow the natural environment around you to beautify your surrounding. If you already have a plan about the climate or natural environment that you need to spend your life in, use a luxury property website like Luxely to find your green real estate in that area.    

In conclusion, green real estate is the future of the real estate industry and it is becoming a luxury that everyone chases to make their lives better. Therefore, this is a great time to make your wise move and invest in green real estate which will benefit both you and the world.