Sri Lanka plans to complete 31,000 homes under its 2026 national housing programme as the country faces a housing deficit estimated at about 900,000 units.
The National Housing Development Authority says 15,000 homes under the programme have been assigned to the authority. The target sits alongside separate reconstruction work for households affected by recent disasters.
At the current estimate of need, 31,000 homes equal about 3.4% of the national housing deficit, according to a Lakbima News calculation.
A government post-disaster assessment published this year records another figure that complicates the housing picture. Sri Lanka has about 6.76 million housing units, including 732,103 classified as unoccupied.
The comparison is numerical. It does not mean those homes can be transferred directly to households seeking housing. Government documents cite migration, investment properties, legal disputes and poor structural condition among the reasons units remain empty.
The location of those homes also matters. A vacant property in an area with weak transport links or limited employment cannot automatically meet housing demand in Colombo, Gampaha or another high-pressure urban area.
The figures raise a wider policy question over how much of Sri Lanka’s shortage should be addressed through new construction and how much could be reduced through existing housing, rental reform and better use of available land.
Official housing targets use different figures
The 2026 Budget Speech said construction on 27,000 new houses, including projects already under way, was expected to be completed during the year.
The NHDA later described the national 2026 housing programme as covering 31,000 homes.
The published documents use different programme descriptions and do not explain whether the change from 27,000 to 31,000 resulted from additional projects or a different method of counting units.
The Government’s Public Investment Programme for 2026 to 2030 sets another target. It proposes 10,000 new homes each year for vulnerable groups and lists community-led housing among its priorities.
A yearly programme of 10,000 homes equals about 1.1% of the current estimated deficit.
The 2026 Budget also announced a medium-term programme to construct 70,000 homes for low-income families. That figure equals about 7.8% of a 900,000-unit shortage.
Land availability is already listed as a constraint
Government planning documents identify high land prices and limited urban land among the barriers to expanding housing supply.
Rural and estate communities face different problems. The Public Investment Programme cites unresolved ownership, weak road access and unsuitable locations among the issues affecting housing development outside major urban areas.
The same programme proposes denser urban housing and formal land-use planning. It also calls for community-led construction and lower-cost building methods.
Sri Lanka’s existing national housing policy already supports denser development around urban centres and transport corridors. Cabinet decided in April 2026 that the policy should be revised to address current conditions in housing and human settlements.
The Cabinet decision appointed an expert committee to prepare the revised policy.
Transport projects are adding pressure to urban land
Major infrastructure projects continue to require residential land in and around Colombo.
Cabinet approved land acquisition in May for the Kelani Valley railway upgrade between Maradana and Avissawella. The project covers land within seven Divisional Secretariat areas and includes the resettlement of families living inside the railway reservation.
The 2026 Budget allocated Rs. 840 million for resettlement connected with railway development.
A separate Cabinet decision in June dealt with households displaced by land acquisition for the Baseline Road Extension. Twenty-nine family units had already received housing at the Sarasavi Uyana scheme, while another eight residents were approved after their cases were reviewed individually.
These projects place transport expansion and residential security within the same land market. Families can lose access to existing homes while the state searches for suitable land for resettlement.
Flood risk is entering planning decisions
Housing supply is also being shaped by disaster risk, especially across the Western Province.
The Disaster Management Centre is working with JICA on a programme to include disaster risk in development decisions across four vulnerable local authority areas in Colombo and Gampaha districts.
The programme involves the Urban Development Authority, Irrigation Department and National Building Research Organisation. Its work centres on the Kelani River basin, where dense settlement and flood exposure overlap.
The Public Investment Programme identifies climate risk and unplanned urban expansion as problems for future settlement development.
The Urban Development Authority has also introduced its My Zone planning platform, which allows users to check development rules and zoning information in gazetted areas.
The platform currently covers selected gazetted development plan areas in Colombo and Gampaha. Local authorities outside those areas still depend on separate development plans, building rules and hazard information when approving new projects.
Colombo continues to use relocation to release land
The Urban Development Authority’s urban regeneration programme was created to relocate families living in underserved settlements into apartment projects and release occupied land for redevelopment.
The UDA says an earlier survey identified 68,812 families living in 1,499 underserved settlements in Colombo. The programme proposed 50,000 housing units for relocation.
The Public Investment Programme says 15,327 units had been completed through direct government involvement and another 6,778 were under construction when the programme was prepared.
The approach links housing directly with land redevelopment. Residents move from existing settlements into apartment schemes while the vacated land becomes available for other urban uses.
Renting remains outside a formal national regulatory system
Ownership remains the dominant form of housing tenure in Sri Lanka. Census data for 2024 show that 84.6% of occupied housing units were owned by a member of the household.
Rental housing plays a larger role in the Western Province. Private renting accounted for 16.6% of housing units in Colombo and 12.5% in Gampaha.
The Government’s investment programme states that Sri Lanka still lacks a formal mechanism to regulate the rental housing market.
That gap affects households that cannot afford land or qualify for a state housing project. It also becomes more significant in urban areas where land prices remain high and large transport projects require resettlement.
The revised National Housing Policy is expected to cover housing and human settlements. The April Cabinet decision appointing the expert committee did not publish a deadline for completing the new policy.
National Housing Development Authority housing programme material; Public Investment Programme 2026 to 2030; Government post-disaster needs assessment; 2026 Budget Speech; Cabinet decisions on housing policy, railway land acquisition and resettlement; Urban Development Authority housing and zoning information; Disaster Management Centre planning material.
