The real estate arm of Sri Lanka's Carsons Cumberbatch group said it was writing down the values of properties by 450.3 million rupees (US$3.9 million) as the prices slumped in the wake of tight monetary policy.

"This year has been a challenging year where we saw a significant market correction on the property prices as a result of tighter credit conditions and a change in investor and customer attitude on real estate," Equity One Ltd, a Carsons property firm said in a statement.

"The property values have reflected changes in interest rates and risk.