A new report from an international analyst finds Panama’s real estate prices are rapidly increasing, in large part due to international interest.
“Property values are now rising strongly in Panama’s most sought-after areas,” Global Property Guide says in a news article. The average home price rose 21 percent from January 2015 to June 2017 in Panama’s metropolitan area, the site notes, quoting the Panamanian Chamber of Construction (Capac).
In 2018, data shows prices continued to rise, “buoyed by strong economic growth,” the site notes. In fact, Panama’s economy has been growing between 4 to 6 percent annually in recent years, providing a strong foundation for the property market. The International Monetary Fund predicts Panama’s economy will grow by 6 percent this year and by another 5.5 percent in 2020.
In the property market, economic growth translates to more multinational corporations relocating and expanding their operation in Panama City, supplying a steady flow of executives looking for homes to buy and rent. At PPR, we have strong relationships with many of the top companies, such as Marek, Sony, Procter and Gamble, Adidas.
“There is strong foreign property demand, particularly from the U.S., Canada, Venezuela, and Colombia,” Global Property Guide says.
The report also notes that rental yields are strong with a 5.75 percent average, which doesn’t really represent the performance of many of the top apartments which were purchased at discounts. Even with the increases in recent years, prices are still 10 percent below the peak levels in 2008, Global Property Guide notes.
At PPR, we’ve seen first-hand many of the elements reported in the report. But there is no doubt the key caveat there is “in the most sought-after areas.” Any careful analysis of the market should note that the growth is coming in the most popular parts of the city and top-end projects with the type of amenities and quality expected from international buyers.
At the Hyde by Wanders and Yoo, which is located in the heart of downtown, and with the Beach Club Residences on Ocean Reef, we’ve seen exactly the type of activity described in the report. International interest is high and buyers and investors are focusing on location, amenities and the ability to generate steady income.
If you’re interested in getting better read on the market, we’re always available to help.
Duncan McGowan is President of Punta Pacifica Realty, the largest sales, rental and property management firm in Panama City.
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