Thread: Real Estate in Panama

Well I just made it back to Panama and I am getting back into the groove of what's going on. Even though I live in the interior I am starting to hear even the locals are loosing their jobs. I still feel this is a great place to be and living in the interior is SUPER cheap. Having been in Florida for 5 weeks was like hanging out in the morgue.

Florida is going to take a long time to recover...in Buffet's words, not in his lifetime. Globally it appears that money will be tight for some time so I wouldn't expect any huge upward push for Panama real estate..if anything stable to continued downward pressure. The only exception would be from any economic boost to be recieved from the canal construction in PTY.

I do truly feel bad for my friends back in Florida along with everybody else that has been affected by the downturn. I still feel that people will continue to come to Panama but they will be looking for cheap housing, cheap food, cheap everything. I do know that some big companies are setting up shop in Panama so there is an influx of well-to-do international business types moving into Panama. Many of which are winding up in Costa del Este.

I'm seeing the same condos for sale after more than a year with the same listed price. It just doesn't make sense. When nobody is buying, why not bring those prices down.

You'll have to make an OFFER to get the price down... Hard negotiations is part of the culture here.

And in Panama -- a lot of people put their houses and cars for sale at THEIR PRICE "just in case" they find someone who is crazy enough to pay the price. Otherwise, they don't care. It's one of those weird cultural things... Just check out how many cars have "Se Vende" on them in the city.

Matt

But Matt, we all know that the majority of the condo owners in the newly built highrises aren't even Panamanian.

This one might not have a definite answer, but what is the range of costs/sq foot for building your home in the interior? We visited Altos del Maria last June and the salesman quoted us $50 - $70/sq foot. He also mentioned he personally knew individuals who had built their homes for less - for as low as $35 - $40/sq foot. We are not looking to build the Taj Mahal when we make the decision to build. We are just looking to build a nice comfortable 3 bedroom, 2 bath home (probably not in Altos del Maria) - maybe 2300 sq ft with a covered parking area and a bohio.

Originally Posted by HOSEM1

But Matt, we all know that the majority of the condo owners in the newly built highrises aren't even Panamanian.

I'm aware (that being said there is a LOT of Panamanians that bought when things were hot... probably more than you think). However, those with money are PATIENT. They are still waiting for "Boom 2". LOL. The only "super hot deals" that I'm aware of are people that are DESPERATE FOR MONEY NOW and as far as I'm aware -- they are not that heavy out there. BUT THEY ARE THERE! Just be patient and keep hunting! GO!

Matt

Look for foreign owned condos that are not furnished, they are the bargains.

Interesting read about the real estate market in PC.
Why you won't see rock bottom prices on condo's in Panama - Panama Investor Blog

Great article, seems to coincide with all of the feedback in this thread. The Panama Investor Blog is always good insight.

Panamacondomarket.com Transparency for the Overbuilt Panama City Panama Condo Market

This site was publicized in today's Craigslist Panama (venta de Pisos).

Somebody is going into Craigslist to make all the North American pre-construction buyers feel better about themselves? Let's see if the owners of the new generic site put up their names or faces?

There's nothing new on this site.

I think it's safe to say that the Panama real estate market is NOT going to bust.

Matt

I agree, when you compare Panama to how the rest of the world is doing you realize there is a difference. Another poster mentioned he left Dubai (along with many people) and has now discovered Panama. Dubai's real estate value has dropped %52 in the last year. There has been a bit of an adjustment here but not like that.

But prices still are too high. The vast majority of panamanians can't afford them, it's driven almost entirely by foreigners, specially venezuelans and colombians. What if there is a drastic change of the government in Venezuela ? Of course it is a very remote possibility, but who knows what will happen.
Most of them would go back or won't be coming to Panama to buy.You just can't rely so much on foreigners. Prices have to be affordable for the middle class of Panama.
I think it's safe to wait another 12-24 months before buying, since there is very little chance of prices going up.

Right now it doesn't hurt to wait anywhere in the world to purchase. Just make sure to avoid speculation, do your homework, and you will be good. I am still amazed to see how many people are purchasing. I thought there was going to be a larger adjustment to the market here.

I totally agree with you MRWOOHOO, I expected a bigger downward pressure too.

I truly feel that the rest of the world has taken such a downturn that Panama still is the one place EVERYBODY that can is escaping to. Things may not be perfect here (no such thing as a perfect country) but for me it works. Plus food and drink is cheap and plentiful.

MRWOOHOO, you forgot to mention one other thing that is plentiful.LOL.

I obviously don't know what you mean?

If you're waiting for the market to go down any further, you might be waiting for years (or decades)... It seems to have hit "the floor".

I literally sat down with a relatively successful real estate agent on Wed. night.

He revealed all of the latest news:

Top market movers right now are: Canadians (too damn cold up there) and Venezuelans (3000 new Venezuelans are coming here each month and probably more are coming).

Market has dropped 25% from a year ago.

You can still get 8% to 12% ROI if you buy and rent a place (if you buy it for less than $950 a meter).

$950 a meter or lower is the target price ALWAYS.

Offer people 70% of what they're asking. I've said this before... if you're looking at the ads waiting for a miracle.
That's a formula for an EPIC FAIL.

The key is to get out there... see lots of places... and low ball... low ball... low ball.

Then call them back every 4 weeks and ask them if they've changed their minds.

He said he did this and got someone who was asking $350,000 to drop to $210,000.
It took 4 months and 8 phone calls.

Hot deals are NOT going to just show up on your door step and they are certainly NOT going to show up on encuentra24.com or craigslist.com

If you want a hot deal in this market, you need to earn it. You need to see lots of places, make lots of offers (in your favor) and be super persistent and call them back.

Another interesting point that he said is: that most of the places in Panama are paid for in cash. He said a lot of people do NOT want to keep their cash in the bank (or all of it) because none of the money is guaranteed or backed by the Gov. in Panama. And they can get a much better return. So that's another reason why people aren't too excited to just sell their places super cheap.

I hope this helps guys!
Matt

But Matt, I don't think you can buy anything let's say on Balboa Avenue(recent construction) for less than $1700-1800 /sq. met.
So when you talk about $950/sq. met. , which areas do you mean?

Avenida Balboa has always been more expensive than the rest of the city and will always be more expensive than the rest of the city. If you want to live in the high end areas, and you want a brand spanking new place, then of course you're going to pay more.

You could get deals closer to $1000 a meter NEAR Ave. Balboa for slightly bigger, older places.

El Cangrejo, O'barrio, Bethania, El Dorado -- those are the places to look at for good savings.

Matt

Would you include San Francisco in with that, Matt?

Sure -- also I forgot to say that PRE BOOM: Avenida Balboa was $1500 a square meter for a decent place. If you're paying $1700 sq/mtr for a nice place -- you're close to "pre boom" prices.

Other places to check out: Diablo, Hato Pintado, 12 De Octubre... You can get even better deals there.

Matt

San Francisco area is overbuilt. I'm almost certain there will be more price correction there. Already has happened but expect more.
Matt, I think pre boom sq. met . for ave. Balboa was much lower than $1500, but I maybe mistaken.

I was shopping for apartments on Ave. Balboa 5 years ago and $1500/meter was the norm (the same in Punta Pacifica). I saw literally over 20 apartments back in the day, and they were all in that price range. At best, you could find an older unit OFF of Ave. Balboa (not directly) for $1200/meter. Then Trump came and went to $3000 a meter and everyone else cranked their prices to $2000 to $2500 meter and that's when things came to a halt (along with the crash of the US economy). So $1700 to $1800 is a decent price for something brand new.

I don't expect a correction in San. Fran. It's very close to the core of the city... close to the corredor. That being said, it's a place that you can pick up an OLDER place for around $1000 a meter if you haggle with the right people.

Matt

Matt is on with the prices and the areas. Balboa is a nice area but traffic and diesel fumes are bad outside of the building. I am a big fan of El Cangrejo and the Bank District. Having a 24/7 supermarket and many many restaurants and nightlife all within walking distance is really key.

Marbella is also a great area.