Real estate market data matters. Without access to accurate and timely sales data, market comps and price trends, it’s hard to know if a property is properly priced. Inadequate information can make buyers cautious in presenting offers and sellers less likely to set realistic prices. An inefficient and sluggish market is often the result. More transparent markets on the other hand – where buyers and sellers can access reliable data – foster confidence, improve decision-making and build trust.
Jones Lang LaSalle has been tracking global real estate transparency since 1999. In the 2012 index, Canada and the US were the only two countries in the Americas to fall within the "Highly Transparent" category. In Central America both Panama and Costa Rica were given a "Low Transparency" result due to low availability of market data. Other Central American countries where not covered.
But the news across the region is not all bad. Information is starting to flow, albeit slowly. Several fledgling Multiple Listing Systems modeled on the US approach are under development, broker collaboration is increasing and a growing number of quality blogs and property sites are providing robust market commentaries.
It’s into this rising transparency story that Reveal Real Estate and Global Property Guide have introduced the 2012 Central America House Price Snapshot. The study provides an apples to apples comparison of the sales price of a “typical house” across 12 popular property hotspots in Central America. These are sought after locations with local attractions and attractive landscapes that draw in tourists as well as real estate investors. Places like Ambergris Caye in Belize, Tamarindo in Costa Rica, Boquete in Panama and San Juan del Sur in Nicaragua.
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The snapshot data is generated by a special benchmarking group of recognized real estate experts with in-depth knowledge of their local market. The “typical house” is defined as a single family home that has sold in the previous year, approximately 2,200 square feet in size with 3 bedrooms and 2 bathrooms, on a lot no greater than ¾ of an acre located in a “middle market” neighborhood.
- The median house price for the 12 markets was $260,000
- The average house price for the 12 markets was $285,000
- A $425,000 price gap was found between the most expensive market (Placencia Peninsula, Belize) and the most affordable market (Granada, Nicaragua). Note: The house identified in Placencia, Belize is located on the beachfront
- In all locations the price for a typical three bedroom house was below $580,000. If we remove the beachfront property identified in Placencia from the sample, in the remaining 11 locations the price for a three bed house was below $380,000.
- The two lowest priced markets are located in Nicaragua.
- The two highest priced markets are located in Belize and Costa Rica.
The snapshot provides a simple dataset that helps set expectations and compel action in unfamiliar markets. While it can’t compete with the vast array of real estate data served up to buyers in the US or Canada, by focusing on sales price data it offers a useful insight into the demand side of the market and helps improve the flow of information to everyone involved in the real estate sector in Central America.
The snapshot results and a video explaining the approach can be seen here: http://www.revealrealestate.com/snapshot