Panama Real Estate Market Trends 2021

[Gomez Tomiczek]

Panama has always positioned itself as an attractive destination for expats, businessmen, retirees and foreign investors. Forty percent of real estate assets in Panama above USD$140,000 are purchased by foreigners. Despite the pandemic we can see that the Panamanian real estate market is going through a boom by international buyers.

Work from Anywhere

Both commercial and residential real estate market trends are changing due to COVID-19. Before the pandemic, digital nomads were a phenomenon of the digital revolution. Traveling and seeing the world with a flexible job working online was a unique way of life for a small group of freelancers, innovative entrepreneurs or highly digitized specialists. But in 2020 an emerging trend became a mass movement. Large, traditional companies that previously demanded a work culture from their employees where the team must be physically "present" in one place, suddenly felt compelled to jump into the 21st century, and all within a few days.

Home Office - The New Normal

But the home office lifestyle has not only created new fashion trends, sudden shortage of office supplies such as home printers, change of laws, and strange and sometimes even comical situations due to the use of new means of communication such as Zoom, Google Meet, Skype among others, for team and client meetings. People are waking up to new possibilities: Why do I live in an apartment whose rent eats up most of my income, if work can be done after a morning run on a Caribbean beach, while saving a lot of money living in a warm place? Because of the COVID-19 crisis, millions of people are starting to work from anywhere. Even big hotel chains are remodeling their rooms in order to convert them into small, temporary, beach-side home offices for holidaying remote workers.

Something for Everyone

The type of real estate available in Panama is very varied. The isthmus of Panama boasts mountains and beaches, and allows you to wake up in the Caribbean and have lunch overlooking the Pacific. Although Panama City is a dynamic and modern city, much of inland Panama remains quiet and remote. This geographical diversity converts Panama into an interesting market for buyers who prefer the city, as well as those who do not. In recent months we can observe two trends of real estate buyers in Panama, the purchase of unique spaces located in the interior of the country and the investment in centrally located apartments in Panama City with the aim to put them up for rent and thus create an additional source of income in the long term.

Foreign Real Estate Investment in Panama

Alberto Grajales, commercial director of encuentra24, a digital portal specialized in classified ads, indicates that 250,000 visitors are registered monthly in the English version of the portal, of which the vast majority are looking for information about real estate properties in Panama.

Unlike other tourist destinations, foreigners and nationals can buy almost any type of property in Panama. It is also possible to own and sell property titles in your own name (although it is not recommended) or through corporations or foundations, even without being a resident, only with tourist status. Panama has a fully dollarized economy, with the US dollar being the legal currency in the country, which allows diversification out of the Euro zone. And the current exchange rate between the dollar and the euro favors European investors even more. New demand and opportunities arise from changing lifestyle circumstances due to the new way of remote working, global economy and financial and personal priorities.

[Moderator_02]

Quote

Real estate market remains in ICU

70% of sales were below $120,000

Posted 30/04/2021

Panama’s housing market is still in intensive care but showing signs of recovery during the first quarter of the year when sales exceeded the movement registered between October and December of last year, said Diego Vallarino, executive president of Grupo Verde Azul, in an analysis presented to the members of the American Chamber of Commerce and Industry of Panama. (AmCham) on the impact of teleworking on the real estate sector.   According to data from the Panamanian Association of Real Estate Brokers and Promoters. At the end of the first quarter of 2021, the inventory of residential units was reduced by 1,000 homes, although there are still 24,000 homes completed or under construction.

Over 70% of sales were concentrated in the range of $120,000 downwards, but there was also an increase in the placement of homes whose price ranges between  $400,000 and $600,000.

One of the segments that has registered the most demand in recent months is properties on the beach or outside the areas with the highest density.

It was shown that productivity increased with teleworking, a modality that attracted benefits for the employer and worker, such as lower expenses, better use of free time, among others," he said.

For real estate developer Félix Carles, teleworking allows people to be connected anywhere without affecting their obligations, a benefit that made it easier for people with the necessary purchasing power to choose to acquire a second home in the beach sector.

"Whoever could left the capital city to get rid of the stress of months of confinement," he said.

But while the inventory of residential properties has decreased in recent months, the available premises in the commercial sector have increased by about 27,000 square meters, a rise of 1.5%, attributed to the closure of companies.

Vallarino said that the real figures for the commercial sector will be known once the country's health situation normalizes since at that time, companies will decide whether to keep their workers teleworking or return to their offices.

 

https://www.newsroompanama.com/business/real-estate-market-remains-in-icu