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The tides of Panama Citys real estate market have shifted in recent months, as the countrys economy continues to grow and international investors return to the market.

Today’s market is very different than a year ago, with sales and prices rising at a slow-but-steady pace, according to a new market analysis by Punta Pacifica Realty (PPR). In some neighborhoods sale prices for apartments are up more than 10 percent in the last year, particularly in buildings popular with executives from the multinational corporations expanding operations in the city.

In Punta Pacifica, the exclusive waterfront community of skyscrapers, prices have increased by 14 percent over the last year and the sales volume is up 35 percent, according to PPR data. A year ago average prices in Punta Pacifica were $2,200 a square meter, with a few select apartments available at closer to $2,000 a square meter. Fast forward to today and prices are closer to $2,500 a square meter, with a few rare deals at $2,200 a square meter.

Several key factors are driving the growth. While many countries are still struggling in the wake of the global economic crisis, Panamas economy grew 6 percent in 2014. Although down from the double-digit rates of a few years ago, the numbers reveal a healthy economy providing more buyers and renters for the property market.

But the biggest sign of change has been the return of international investors, particularly from the United States and Venezuela. The uptick in the U.S. economy has Americans looking for investment and retirement opportunities again, while turmoil in Venezuela has many wealthy citizens looking for long-term investments outside their own country.

Panama City real estate is also showing signs of The Miami Effect, which has impacted the market in the past. When Miami was cheap, investors flocked to Miami. But now that prices are rising again in Miami, they are looking for alternatives like Panama City.

Like Miami, after the building boom, Panama City was left with an oversupply of apartments that has been steadily absorbed in recent years. The last of the large pre-construction projects to be delivered in Punta Pacifica was Grand Tower, which started handing over apartments to investors in the first quarter of 2014. While the developer is still delivering the last of the apartments and construction of the roof top social area has yet to be finished, we are seeing strong demand and a steady absorption rate of the inventory into the rental market.

The increase in demand and prices in Punta Pacifica is evidenced by the start of construction of a new pre-construction project, The Residences, by the developer Habitats. This is the first major Pre-construction project launched in Punta Pacifica since the downturn and a sure sign that developers and financiers see the shift in the market.

All around Panama City, there are signs of new construction, as the industry responds to the improving market. Adjacent to Punta Pacifica, construction is underway on several three story apartment buildings on Ocean Reef, the first of two manmade islands. On Amador Causeway, where the Frank Gehry designed bio-diversity museum recently opened and a new convention center is almost finished, developers are proposing several projects that could create a new luxury residential sub-market for the city.

Unlike past years, organic economic factors are driving the growth in the market, a far different scenario than the irrational exuberance of the boom years. There are few speculators or flip specialists active in the market these days. Buyers and sellers are responding to the economic growth and a desire to be part of the booming city, a true sign of a healthy residential market.