The property market in Mandalay is on the decline and is expected to lag again in 2013 from high prices and a lack of buyer interest in the city’s outskirts, property brokers said last week. Property prices in Mandalay’s undeveloped areas on the outskirts of the city, particularly in Chanmyatharsi and Pyigyitagun townships, had doubled or even tripled in late 2011. Experienced brokers described the price boom as an “unnatural market”.

About two months after the boom, the property market remained steady until late July 2012. Some property soared to K30-50 million for a 2400 square foot plot on Mandalay’s outskirts; meanwhile, prices downtown remained steady as it continued to develop and attracted demand.

“It is rare to see buyers in the market for property in both the outskirts and downtown area. The market in the outskirts has been affected by the issues [the Mandalay City Development Committee] has had with trespassers, so people are reluctant to buy property there. I think this situation with the property market will continue into 2013. It will take a long time for Mandalay’s property market to boom,” broker U Khin Maung Thaung, from Htin Paw Estate Agency in Myo Thit, said.

Freelance broker U Aung Win said that Mandalay’s unusual property market is the result of buyers purchasing large amounts of land on the outskirts before the spike in 2011, and then selling it for a high profit. After, he said, many other property-owners followed suit and left Mandalay’s property market.

“The situation happened once in 2007, but when it happened in 2011, it made the market much worse than before,” he said.

U Aung Win added that investors should work to cool Mandalay’s property market if they are looking to make a profit on property in the outskirts.

U Thant Zaw Linn, from Pwint Linn Estate Agency in Pyigyitagun township, said the market could stabilise again if property prices on the outskirts cool.

“Good places are hard to sell, and owners don’t want to sell their property by reducing prices for their plots,” he said.

In August 2012, the government increased the property purchase tax from 15 percent to 30pc; if the buyer cannot provide proof of income, the government will add another 7pc.