As a result of the depreciation of the value of Burmese kyat, real estate prices in Yangon are now 25 percent higher than before, according to real estate agents.
Concerns regarding historic devaluations by the junta have caused an influx of citizens to sell their kyat for gold and foreign currencies. Further devaluing the kyat is the junta printing new banknotes, creating increasing inflation.
“We estimated that the inflation rate in Burma is from 17 to 20 percent at the moment,” a business researcher told DVB.
“It is difficult to calculate, as the number isn’t stable yet, but the main things that we are seeing are the increasing prices of fuel and the dollar, which has risen up to 40 percent. We can estimate that the inflation rate is also between 30 to 40 percent.”
As a result of inflation, property values in Yangon’s real estate market have increased by 25 percent and prices remain high.
“It has increased up to 25 percent within the last ten days, but it is not similar to gold and dollar prices. That’s why people who like to buy new properties are reconsidering the market. Prices are not decreasing, even though the rate has stabilized,” a real estate agent told DVB.
Currently, real estate worth less than K100 million (US $47,764) is being paid off within a day, while properties worth more than K1 billion (US $477, 647) are being traded discreetly, according to an entrepreneur monitoring the real estate market.
“Properties in the suburbs are being paid off overnight with cash. For example, overnight purchases not using bank deposits are made if you have K500 or 600 lakh [US $2.4 million and $2.8 million, respectively] in hand,” the source said. “I see a lot of these types of transactions in places like Shwe Pyi Thar, Hlaing Tar Yar, South Dagon and other suburbs.”
The exchange rate set by the Central Bank of Myanmar was K1,331 (around K1,400 in markets) per US dollar on the day of the military coup on Feb. 1, 2021. Although the CBM’s USD exchange rate is K2,100 as of Aug. 22, 2022, black market prices are between K2,800 and 2,900.
Foreign currency exchange rates have increased by over 50 percent since the military’s seizure of power last year.