The president of the Board of Directors of ACOBIR (Panamanian Association of Real Estate Brokers and Promoters), Francisco R. Cheng León, believes that we are currently at a very good time to invest in real estate in Panama as future prices could show an upward trend.
The Panamanian real estate market has shown positive signs which was appreciated by FIABCI (International Federation of Real Estate Professionals). ACOBIR is a member of this federation which is made up of 70 countries.
Consolidation of Preferential Interest
According to Cheng León, after evaluating the performance of the real estate market, both of local and foreign buyers, it’s important to continue with the dynamism in the range of preferential interests, for homes with costs between $ 120,000 and $ 180,000.
The increase in the preferential section has boosted developments in the city center and allows the local to acquire homes in fairly central areas.
Once employment stabilizes, the dynamics of mortgage loans can be resumed, because the market depends on financing from Panamanian banks.
In the case of the foreign buyer, he explained that this type of investment should be consolidated, with a view to a ten-year horizon.
He said that despite the challenges imposed on Panama, “it is a country in democracy, with a rule of law and political stability, compared to other nations in the region.”
This set of characteristics favors investments, as well as the use of the dollar, geographical position and a favorable legislative framework such as the Multinational Company Headquarters Law (SEM) and the Law of the Special Regime for the Establishment and Operation of Multinational Companies related to manufacturing (EMMA).
Market in Figures
The president of Acobir explained that the union develops annual studies to measure the behavior of the real estate industry.
In relation to the total inventory available (includes units ready to occupy, in pre-sale and under construction), he said that it was positively reduced at the end of 2020 versus 2019 even as the pace of sales decreased.
From 29,000 units in inventory in 2019, it stood at 24,000 units in 2020, a difference of 5,000 fewer homes.
This reduction was fundamentally due to the decision to stop the projects in pre-sale due to the circumstance of the pandemic, with which these units were removed from the inventory.
Cheng León highlights that 2021 reflects a reactivation, at a higher rate than 2020.
In addition, buyers have the option of renting and then purchasing the property or buying the project flat.
Prices have been maintained, although there is concern about the impact of the increase in freight on the costs of construction materials, mostly imported.
They still do not have definitive projections regarding the impact of this inflationary reality of the material on the construction price.