The idea of investing in real estate in Mongolia, a country that has historically and traditionally been nomadic (in fact, about 30% of the population is still fully or semi-nomadic), at first seems counter-intuitive. Even the capital city Ulaanbaatar changed locations a staggering 28 times before settling permanently in its current location – with such a loose cultural attachment to the land, why bother buying any? And why do so many people still choose to live in a nomadic or semi-nomadic way?
The answer begins with the climate and style of the land. Much of Mongolia is non-farmable land, which does not lend itself well to permanent settlements. However, it does lend itself well to grazing animals, much like the Great Plains of the western United States. And just like the Plains Indians, native Mongolians developed portable homes (gers, or yurts) and followed the grazing animals. Some Mongolians still live in these gers at least during the winter, for several reasons. One, because they’re small, round, and well insulated with wool felt, they’re easy and inexpensive to heat. Two, because certain parts of Mongolia are subject to discontinuous permafrost, a permanent structure can be difficult to build, because digging a foundation is very labor intensive in frozen ground.
However, no matter how charming and affordable living in a ger can be, twenty-first century technology and comforts have begun to seduce people into more modern living situations. The very fact that construction is difficult makes permanent buildings that much more valuable and desirable, especially to businesses trying to convince international customers that investment opportunities in Mongolia will offer a good ROI. It can be hard to conduct Western-style business from a ger, and the plumbing and steady electricity enhance the status of a home or business.
Ulaanbaatar is the capital and main population center of Mongolia, with as much as 45% of the nations people living and working within the city. Because of the population density, investment opportunities abound here for those enterprising enough to see them. However, investors should not overlook possible investments in other parts of the country, such as smaller cities and mineral mining.
Tourism is a small portion of revenue for much of Mongolia, but a sector that could grow with wise marketing from travel agencies. After all, where else on Earth could one go to see a festival with 400 hunters on horseback, using golden eagles to catch their prey? Where else could you see an entire country turn itself out for three June days of archery, wrestling, and horseback games, called Naadam? And considering the long, cold winters, the Ice Festival is a bright spot in the middle of the chill. And all these tourists would need hotels to sleep in, restaurants to feed them, and beautiful mementos to buy so they can remember their trip.
Consider Mongolia for your future investments, and see your money grow along with the beauty of a nation.