Make no mistake, the last six months in Panama have seen a noticeable rise in property values, especially along waterfront districts like Balboa Avenue, Punta Pacifica, and Costa del Este. Strong demand from the US and Canada, Venezuela and Colombia, along with an uptick in the economy of European countries like the Spain and the UK in 2013, and a decreased supply of new apartments for sale have driven up prices by as much as 10% in certain areas.
Because developers were not building new high rises between 2009 and 2012, the next 12-24 months’ supply of brand new apartments will be limited to a handful of projects; this as opposed to the roughly 4,000 new apartments that hit the market over the last three years.
This slackening of new inventory, combined with steady/rising demand will continue to drive prices up.
Some low-priced apartments in high end areas still do come on the market from time to time, including a one bedroom apartment just listed along trendy Balboa Avenue. The Bayfront building, a favorite amongst the corporate expat scene, boasts a rooftop swimming pool, gym, along with a private movie area and business center: http://www.panamaequity.com/listings/bayfront-panama-apartment-for-sale
Now may be the right time to take a serious look at getting into the market, which after being flat for over three years is once again trending upwards. Real estate prices in Panama have historically followed similar markets like Miami, and are usually on an 18 month lag. Considering what happened in Miami just over two years ago, it’s no surprise that Panama real estate prices are on the way up.
Buildings like the Allure have seen strong sales and only have six remaining apartments, ranging from $375,000 to $1.5M. Rentals in this building are also in high demand, due to the building’s close proximity to the Calle Uruguay dining district and the Cinta Costera Park system.
Just down the street from Allure sits the Grand Bay Tower, a project from Empresas Bern, one of the best developers in Panama. A listing that caught our eye in this tax exonerated building is a city-view apartment currently tenant occupied and listed for a quick sale price by the owners at $175,000: http://www.panamaequity.com/listings/a-bargain-in-this-grandbay-panama-condo-for-sale. It’s the type of turn key property that buyers looking for investment returns can jump on to start generating positive cash flow from day one.
For those looking to get in on ground floor pricing, the Casco View development could be a winner. We like the low cost model in Panama, and the fact that the building is just outside of the Historic District of Casco Antiguo means that early buyers will be in the path of progress as development continues to push into the areas currently considered to be under developed and off of the investor radar: http://www.panamaequity.com/listings/tremendous-opportunity-in-panamas-historic-district/
In the real estate game, its not just about location, it’s about timing and 2014 is going to be a game changer for Panama. The Metro will open and the road reorganization projects throughout the city will be completed, plus the historic renovations in old town and the Cinta Costera 3 will also all be completed, breathing new life into a city that’s felt like it has been under construction for the last five years.