This is an excellent report put out by Kent Davis, a friend of mine in the City who finds the best priced deals and who made a bundle on resales in the Trump Tower when the prices were at the lowest point. He has similar deals available right now and he is targeting towers where the supply-demand imbalance is creating bargains. Let me start with the Conclusion to set the theme for all of Panama including the province of Chiriqui where I live.
2012 will be a very interesting year for the real estate market in Panama. Time will tell how increased supply (and demand) will affect prices but in the end, Panama remains a very attractive place for both inventors and end users of real estate. The New York Times just named Panama the #1 tourist destination to visit in 2012, and if only 1% of the tourists decide to buy something here, that may account for any extra inventory.
The Economist compared Panama to Singapore and we’ve heard similar comparisons to cities like Seoul in the 80’s. If these predictions are true, this could be the emerging city in Latin America in a few years…and just image what that will mean for real estate values.
Panama’s 7-Year Wave and The Swells to Come
Introduction: The Panama real estate boom will continue in 2012, but what direction will prices go and what is the future of the real estate for this small Latin American country over the next 12 months?
In order to make any sort of prediction about Panama real estate trends in 2012, one has to take a look back at the last few years, namely the boom town years of 2005-2008, the correction and plateau period from 2008-2010, and the slow yet steady year that was 2011. Who was buying, what was getting built, and what areas are currently safe bets for appreciation? This report will answer these questions along with a number of others to provide a more transparent window for those in the market.
Section 1: The Backstory
Back in 2005, Panama was still relatively undiscovered by North American buyers. Business travelers and tourists totaling less than 800,000 per year were coming to Panama because they recognized opportunity. The newly elected Martin Torijos was seen as one of Panama’s first progressive presidents and his policies and his constituents opened the doors for foreign investment and more importantly real estate development.
2005 was the benchmark year that a number of construction projects on Punta Pacifica and Costa del Este broke ground. Investors were snatching up preconstruction condos in luxury buildings at prices around $800.00 per square meter and Panama was still relatively undiscovered as real estate markets around the world were peaking. I was watching developers publish newer, higher price lists every few weeks showing strong inventory absorption and thousands of condos were being sold over the phone, site unseen. With only 10-30% down, investors were seeing 100% returns on their money by flipping their contracts and buyers were easily found. I made a lot of clients very happy during these days and most real estate deals were being done over the phone.
Enter 2008 and the economy and real estate market in Panama were still red hot. GDP was pushing 10%, tourism was an emerging industry, and places like Costa Rica and Belize were on the backburner. Everyone was thinking “Panama” because, in all reality, lots of money was being made on real estate flips and there was no end in sight.
But then in the fourth quarter of 2008, the bottom fell out of the financial markets and real estate movement in the US grounded to a halt. Prices began to plateau in Panama as investors still tried to realize the gains that had been so easy during years prior, with local developers, property owners, and foreign flippers standing firm on their asking prices and refusing to believe that the world economy could affect the Panama buying fever.
The 24 months following January 2009 saw across the board pricing corrections in the Panama City and beach real estate markets, deflating the bubble and slowing down a red hot market. Buildings like Sky, Ocean One, and Aqualina saw price per square meters prices that had peaked at close to $3,000 per square meter ($280.00 per square foot) come back down to earth and settle out around the $2,200 – $2,300 per square meter range, a correction of roughly 20% to 25%.
The Panamanian economy slowed, but unlike its neighbors to the North, still showed positive GDP and very few construction project failures. The Panama Canal expansion project was voted through, and business tycoon Ricardo Martinelli was elected to office with promises to make Panama a global hub for business and a benchmark for urban infrastructure improvements.
Section II: 2011 – A Year Of Pricing Trends
Real estate prices remained flat during the first half of 2011 as the Panamanian economy started, once again, to pick up steam. Massive foreign corporations relocating entire departments to Panama, government tax breaks like Law 41, and a general uptick in global freight movement all led to what would be another year of double digit GDP growth in Panama.
Compared with 2010, we’ve seen a pick up in activity in three main segments: the luxury property market, strong rental demand, and a higher transaction volume for condos sold on both new and existing inventory in 2011. Fellow agents in our broker network reported stronger sales numbers compared to 2010, with only moderate price reductions being made off of list price. During the last six months of 2011 we estimate a roughly five percent listing price correction occurred on City condos for sale above $100,000. Generally deals were being made anywhere from 90% – 100% of asking price on existing resale units, with additional discounts being given by developers off of their published prices up to around 15% off of list price.
Who bought in 2011?
The majority of condos priced between $80,000 and $1,000,000 purchased in 2011 were purchased by Latin American buyers, namely Venezuelans, Colombians, Mexicans and of course Panamanians. Our estimates are that approximately 50% of the real estate transactions in Panama in 2011 were Latin American buyers this past year. We would also speculate that the other 50% of buyers were 20% buyers from the US, 15% buyers from Canada, 10% from Europe and 5% from the middle east and Asia.
Venezuelans: This group of immigrants is being forced out of their native country to far-reaching parts of the world such as Australia, Miami, and of course Panama all because of one person, Hugo Chavez. The longstanding enemy of the US and champion of Venezuela’s poor has been nationalizing much of the country’s economy including the oil and gas industry and in turn disposed millions of wealthy business owners and executives of their hard earned money.
Venezuelans have been coming to Panama long before 2005, but in recent years they’ve been more compelled to come not just because of Chavez but because of the overall lure of the Panamanian economy and prospects for building and retaining wealth and lifestyle. As the Panamanian school system along with the infrastructure of Panama City has improved, entire Venezuelan families, many of whom already had relatives living in Panama, decided to relocate completely.
It’s hard to generalize which neighborhoods Venezuelans generally gravitate towards because you can find them in literally every developed neighborhood in and around Panama City, including Costa del Este, Costa Sur, San Francisco, and El Cangrejo. They tend to be wealthier than their Panamanian counterparts and are either employed on an executive level for multinationals such as Proctor and Gamble, Mapfre, and Copa or entrepreneurs starting their own businesses.
Colombians: Colombians many years ago came to Panama to escape the violent drug war in cities such as Bogota and Medellin. However in recent years, even as their cities became much safer places to live, Colombians were drawn to Panama for different reasons, namely employment and higher wages. It is estimated that there are over 100,000 Colombians currently residing in Panama, many of whom operate small restaurants, garages, and other below-the-radar businesses.
A substantial portion of the Colombians currently residing in Panama also are engaged in high level banking, finance and sales. Colombians tend to be fairly dispersed in where they are living: this depends mostly on their income. Wealthy Colombian families live in developments like Embassy Club, Costa Sur, and Versalles.
South Americans: We’ve seen a lot of activity from buyers coming from Brazil, Chile, and Argentina this year due in some part to their desire to move assets offshore and into a different currency. While there are also a fair number of expats who have decided to make Panama their home, the lion’s share of property owners in Panama from other parts of South America are investors who are looking to generate cash flow via rental properties, both residential and commercial. Panama Equity has facilitated a number of deals at great prices for this small but robust demographic.
North Americans: The American buyer’s market all but dried up in 2010, but is starting to make a resurgence as the economic picture improves slightly, or at least becomes a bit more transparent. Large institutional investors have been in Panama for years, as has the budget retiree.
We saw a lot of traffic from places like Atlanta, Washington DC, Miami and New York in 2011. The frequency and affordability of non-stop flights is certainly a factor, but the economic ties are also not to be overlooked. Large port towns like Savannah, Houston, and New Orleans have hosted high-level trade delegations that have resulted in increased visibility for Panama in those specific markets.
In general, there are three types of American real estate buyers in Panama.
- The first are the budget retirees, many of whom live outside of Panama City in such places as Las Tablas, Araijan, David, and Chitre. These buyers continue to come to Panama for the affordable cost of living, quality medical care, tropical climate, and for the adventure of living overseas. A number of the expats are also leaving the US to escape an unattractive political landscape and create a more favorable tax situation. The average property that this group is purchasing is going to be something under $200,000, most likely a condo less than 15 years old, in city neighborhoods like Paitilla, El Cangrejo, Obarrio, and El Dorado. In the beach areas, these types of buyers tend to gravitate to places like Gorgona, Coronado, and the Altos del Maria mountain community.
- Much of the same can be said about the second group of buyers, which is a more affluent group of second homeowners and those that have made Panama their full time residence. These are folks who may have several homes around the world and choose to live in Panama either full or part time because of, more than anything, the proximity to the United States, the climate, and the fact that Panama is developing as an international hub from which they can travel. This segment of the market has been in Panama since 2005, but the large majority has come over in the last 3 years. They tend to gravitate to areas like Albrook, Balboa Avenue, Punta Pacifica, and in some cases Costa del Este. Pedasi and the surrounding areas seems to be the hot spot for the affluent pioneers looking to get in to an area that remains relatively undiscovered.
- The third group of Americans that have come to Panama and purchased real estate are the investors, both large and small. In 2011, we’ve seen large investors sourcing land banking and cash flow properties as well as the smaller investor looking to move money overseas and realize some appreciation and cash flow. The smaller investors generally gravitate towards the city market, which is more mature and more quickly sized-up than the mountain and beach markets.
Institutional investment groups such as large equity funds, annuities, and development syndicates are always moving in and out of the city but have generally focused outside of the city where well priced, relatively undiscovered parcels are still obtainable in areas like Veraguas, Puerto Armuelles, The Darien, and parts of the Costa Arriba. Playa Venao, Playa Corona, and the Azuero region are all on the investment radar right now for this third group.
The same three groups for Americans can also apply to the Canadians. In general, the Canadian economy and real estate markets fared much better than the mostly-deflated US market in 2011. Resource rich provinces like Alberta and service-heavy economies of Toronto helped fuel demand for Panama real estate by Canadian investors, expats, and retirees.
Despite the troubled European economy, 2011 also saw renewed interest in real estate from European countries like as Spain, UK, and France. In general, Panama Equity worked with both sellers and buyers from Europe in 2011 and we see continued interest from countries like the Netherlands, Germany, and the UK.
2011 was an interesting year for real estate agents in Panama with several large real estate agencies either closing up shop or massively downsizing due to the increased competition in the marketplace. There were also more than a few real estate agencies that fared well in 2011, due in part to innovative marketing and sticking to the basics of successful real estate practices. This was also a year that weeded out those who were in real estate for the easy buck.
Section III: Observations and Predictions For 2012
2012 will bring new challenges and opportunities to Panama. As Panama City moves forward on a massive adjustment of its urban transportation system, traffic in an already congested city of 1.5 million people will get worse before it gets better. The good news is that by mid-2013 we believe that the real estate market will once again begin to appreciate and will do so in a manner never seen before due in part to a completely modernized transportation system and increased revenue from an expanded Panama Canal.
This year, however, we believe that city real estate prices across the board will come down by at least 10% and as much as 20% in 2012, due in part to the massive amount of residential condominiums in construction and their time frame of delivery, specifically along Balboa Avenue, San Francisco, and Punta Pacifica.
One case in point is the district of Bella Vista known as “Balboa Avenue” or Avenida Balboa, an area that will experience the largest increase in supply (in proportion to existing inventory) than any neighborhood over the last five years. People have been talking about Panama being “overbuilt” for a long time now, and this will finally be the year when the lion’s share of inventory that has been in construction finally hits the market.
One would have to assume that an unprecedented dump of new inventory onto a relatively stable market will have downward pricing pressure on the market as a whole. This pricing correction will inevitably affect the “luxury” market of $2,000-per-meter-and-up condominiums in other areas of the city and will also have an impact across other market categories in Panama City including more moderately priced condos in areas like El Cangrejo, Obarrio, and other parts of Bella Vista.
Avenida Balboa has been for the last 5 years one of the most recognized areas of Panama, which is the main reason why so many developers decided to build along this iconic waterfront strip. Balboa is one of Panama City’s prime spots for ocean view condos and – with the newly constructed Cinta Costera waterfront park system – remains a very attractive area. However, almost half of the buildings that line Balboa Avenue are in construction, and 2012 is the year that the majority of the new inventory will finally be completed and released on to the market. The good news is that after this final wave of new deliveries, there will be only a handful of empty lots for future projects.
Back in 2009, one would be lucky to find a brand new high-rise condo on Balboa Avenue for less than $2,500 per square meter ($234 per square foot). In 2011, the average price for a two-year-old condo is right around $1,900 per meter. This represents a 25% price correction over a two-year span.
As of December, 2011, there were are approximately 1,498 completed condo units on Balboa Avenue. Due for delivery in the first quarter of 2012 are four new condo projects totaling 744 new units and due for delivery over the next three quarters of 2012 are an additional 898 units. That means that at the beginning of 2012, there will be roughly 1,500 condo units and by the end of 2012 we are looking at 3,142 completed condo units. This represents a DOUBLING of available, completed, move-in-ready condos in a very finite area of the city.
Not all of these condos are going immediately to market for sale or rent, but some will. Exactly how many? We have no idea, but based on the general demographic of sellers who we are representing, we estimate that at least 50% of the condos in construction were purchased between the years 2007 and 2008, just before the financial crisis.
Some of these new Balboa Avenue condo owners are not going to be in a position to come up with the balance that they owe the developers and will be forced to liquidate their contract positions and take whatever percentage of their deposits that they can recover.
Part A. How do you find the deals?
The best deals come just after the developers start calling for the final deposit: here, timing is everything. In most cases, the price point of units in a specific building can fall dramatically during this brief window, only to recover to “market” levels once the desperate sellers are out. We saw it happen in the Trump Ocean Club, we saw it happen in buildings like Destiny and Sky, and we are going to see it with Rivage, Yacht Club Tower, White Tower, Waters Tower, Arts Tower, and Yoo Tower, all of which are slated for delivery this year.
There are some exceptional deals out there right now, you just have to find the right sellers. Very few of the best deals are ever published on the internet, so it’s up to the savvy buyer to work with an equally savvy real estate agent (or building administrator, lawyer, or anyone else with access to the “distressed” sellers). Panama Equity has listings in all of the buildings mentioned above with a handful of owners who understand the impending correction and are prepared to liquidate immediately. If you buy right now, you can buy in anticipation of the correction and either find a tenant immediately or enjoy your condo and resell once the market has recovered. In 2013, Panama will be a city that has undergone a complete face-lift: new Metro commuter rail, newly expanded Panama Canal, fully operational Costal Beltline, and a world economy slowly working its way out of a recession. That means new buyers and a totally new Panama City. We’re bullish on the real estate market and Panama in general over the next 3-5 years, however we believe that sellers must be realistic and buyers must be calculated 2012.
Part B. The math of a deal
Most of the buyers along Balboa Avenue got in anywhere from $1,700 to $3,200 per square meter, depending on when they purchased. Most of these buyers (you can call them sellers now) have anywhere from 20 to 40% deposits down with the balance coming due when the building receives its occupancy permit. To use a very general example, let’s say a new buyer has $90,000 down on a $300,000 condo. The developers in most cases are probably still sitting on at least 20% of their unsold inventory in this particular building, and we can conservatively speculate that another 20% will be defaulting and/or trying to liquidate their positions.
In the example above, let’s say our buyer purchased a 150 meter two-bedroom condo back in 2009. That condo in today’s market is worth about the same amount that they paid, maybe a slightly less, but what happens when 100 other condo owners in the same building cannot close? (And don’t forget about the developer who is sitting on their unsold inventory and will be bank motivated to burn out their units). This will force the price point lower as distressed sellers fight to recoup any portion of their deposit that they can and developers scramble to unload their remaining inventory. I know of a small handful of developers right now who are slashing their prices multi-fold in anticipation of the correction. They see the writing on the wall and, when the offer is presented properly, are prepared to come down to an aggressive purchase price point rather than lose a buyer. There are, however, some developers who refuse to acknowledge a market correction and are unwilling to negotiate off of their list prices.
Add to the mix of sellers in preconstruction projects the owners in existing buildings along Balboa Avenue like Bayfront, Grandbay and Sky who decide for whatever reason to put their condos up for sale. They’ll have to compete against brand new inventory entering the market, meaning prices will face further pressure. And who is going to pay $1,700 per meter in a neighborhood like San Francisco when they can get an equivalent OCEAN FRONT unit for only slightly more along Balboa Avenue?
Part C. Trump Ocean Club Liquidation
Moving down Balboa Avenue into Panama’s most prestigious neighborhood, Punta Pacifica, leads us to our next market unknown, the Trump Ocean Club. As we predicted, this building, five years after construction, is without a doubt Panama’s most visible and talked about project. The social areas are stunning, the amenity list is far and away better than anything that’s ever been done in Panama, and overall the building is a success in terms of introducing a luxury product to the Panamanian market.
However there are some dark clouds surrounding Newland Developers, the promoter and construction firm responsible for the project. In particular, an overdue bond payment and rumors of a default are making a lot of Trump buyers nervous and new buyers apprehensive.
If bondholders take over control of the Trump Ocean Club, they will liquidate the remaining inventory to cover the outstanding debt on the project. This will represent an exceptional opportunity for buyers to pick up a condo in Trump at a fraction of the original price point. Savvy buyers have been doing this on a small scale over the last six months by taking advantage of sellers looking to get out of their pre-construction contracts and recoup some of their deposits.
The next round of opportunity for savvy buyers will be purchasing from the agency has the contacts on recently-defaulted and/or unsold inventory at fire sale prices. This will all happen in a very short window of time and we believe the overall price points in Punta Pacifica (as a whole) will be affected as the final units in the Trump Ocean Club hit the market. One thing to keep an eye out for: Oftentimes sales agents within the Trump Organization will hold on to well priced condos for themselves and their frequent investor clients, which is a strong reason to consider working with an independent agency who has relationships within the organization and OUTSIDE of the organization.
The key for finding the right deal in Trump is being liquid: either having funds already sitting in Panama or available to send to Panama with short notice. The best deals often get sent out to one or two real estate agencies who have a history of putting together reassigned or defaulted deals or get held by inside sales staff at the developers, and Panama Equity is one of these preferred agencies. Do your homework, become familiar with the building and the exact unit type/floor/location within the project, and be prepared to jump on the right deal when it surfaces. This is no secret in the international investment community and competition is stiff for well-priced defaults.
Part D. An overbuilt hotel sector: implications for income producing assets
One cannot talk about Panama in 2012 without mentioning the massive spike in new hotel rooms that is going to be hitting the market over the course of the next 12 months. This will no doubt have an effect on the real estate market, but in what ways?
For the longest time, hotels in Panama have been very pricey compared to similar markets around the globe mainly due to a shortage of quality hotel rooms. In 2011 a mere 2000 new hotel rooms were added to the City’s supply of existing rooms, which in the Association of Hotel Owner’s opinion is just about the right number to equalize supply and demand and keep prices and occupancy relatively unchanged.
.However in 2012 almost 6,000 new hotel units will be coming on line, more than doubling the number of existing rooms. Although tourism is increasing at an average of 10% per year, this will in no way be enough to absorb the excess supply and many hotel industry leaders are worried that hotel occupancy could drop from a historic 60-70% all the way down to 30%. Prices on hotel rooms will have to drop to keep heads in beds.
The impact of the hotel chaos on the Panama real estate market will be duo fold. First (and on the positive side), lower prices on hotel stays will attract more tourists, some of whom will end up purchasing real estate in Panama.
Second, an increased supply of hotel rooms will also create pressure on apartment rental prices because executives, expats, and frequent visitors to Panama may choose to stay in hotels as opposed to signing a 6-12 month lease. Large corporations like Proctor and Gamble, Caterpillar, and Carnival who have traditionally reserved blocks of apartments on 12 month leases for relocating executives may now start to consider hotels as a viable (and in some cases, less expensive) option. Rental yields on investment properties will be pushed lower, forcing the overall price point of the asset down. We believe rents in Panama City for apartments currently priced between $1,000 – $3,000 per month will see a correction in the range of 10-15%.
Part E. Hotspots for 2012
It will most definitely be a buyer’s market for real estate in Panama in 2012. The biggest trick will be finding the deals, because many well priced properties either never get published or are published and promoted by real estate agents who either do not answer the phone/respond to emails or are not interested in working with anyone other than their direct clients to sell the listing.
Working with several buyers agents at one time may on the surface look like a good idea, however in most cases when one agent realizes that you are working with several, their motivation to spend the time it takes to find you the deal you are looking for quickly evaporates. If you are looking to sell your property, the strategy is different, however buyers will need to get connected with an agent who has relationships with major real estate agencies, developers, and a strong network of private contacts including building administrators, distressed sellers and access to unpublished developer “defaults”.
Buyers need to spend enough time becoming familiar with City offerings, focus in on one or two buildings, and identify the target price point and move quickly when a deal arises. As is the case with any real estate purchase, patience is key, but don’t be afraid to pull the trigger if you find the right deal. The Panama real estate market in 2012 will be brisk, as buyers who have been poised on the sidelines come back in to scoop up the good deals.
Infrastructure is the name of the game in Panama real estate development. The areas to the east of the city developed first because that’s where the water, power, and road access was installed in a big way back in the late ‘90’s. Development started off catering to local buyers in places like Juan Diaz, Ciudad Radial, Brisas del Golf, and more recently Costa del Este and Chanis.
We believe that one particular area poised for growth and increasing values is the area east of Costa del Este and west of the Tocumen International airport, specifically the developments of Versalles, Santa Marina, and Costa Sur due in large part to a second wave of new infrastructure that’s being installed right now.
Literally right next door to the Versalles development is the Las Acasias metro stop, the new El Rey supermarket complex, and the grounds for one of Panama’s largest private schools to date. All of this is happening a mere 10 minutes from downtown in one direction and 10 minutes to the airport in the other. The area is also strategically located about five minutes to Costa del Este, where many corporate headquarters are located including Copa, Proctor and Gamble, and the insurance giant Mapfre.
While the condo market may have potential to be overbuilt, the single family home market continues to show positive gains, especially on moderately priced ($200k – $300k) homes in gated communities close to schools and shopping. Versalles and the surrounding Costa Sur communities fit the bill for what should be continued demand in 2012 from upper income families who want to live close to work in a gated, family friendly environment. I have a number of friends and clients who live in these communities with their families and they have nothing but good things to report.
Another area to watch out for this year is the Amador Causeway, especially if government plans come to fruition. On the books for 2012 is the completion of the Bio Diversity museum coinciding with a widening of the existing road and construction of a massive new convention center complex to the west of the Causeway. Also in construction is the headquarters of the Latin American Parliament due for completion in 2013 and a massive marina expansion plan.
Amador has always been one of the top tourist destinations in Panama, but many foreign investors were concerned that the inventory available was not on titled land, but rather a government concession. What few know is that there is also a part of the Amador Causeway that IS titled and presents 0 risks for any type of repossession. Some of this Amador property has been purchased outright by private investors such as Jean Figali (site of the Figali convention center and the Zona Viva nightlife strip) and other private developers, however there are still a number of fully titled small parcels and condos on the Amador Causeway for sale.
Moving outside the city, we’re seeing a lot of movement in the beach district near San Carlos and expect the trend to continue in 2012. With construction finally starting on the international airport, prices on raw land have seen a sharp uptick due to new demand, particularly in the Rio Hato area near the Decameron. Large retail projects including three new shopping malls in the Coronado area and a commitment from both Hilton and Sheraton along the Pacific Coast have marked the return of inventor confidence in 2011 and we expect 2012 to be a banner year for the Panama beaches real estate market and the Gold Coast in particular.
Keep an eye out for real estate opportunities in the areas of La Ermita, La Laguna and Bejuco, all of which have major residential projects underway and should start to fill in with commercial and retail growth.
The Azuero Peninsula remains a hot market for both foreign and Panamanian homebuyers. With the road expansion between Divisa and Las Tablas set for completion in 2012, access to towns like Chitre, Las Tablas and Pedasi will be easier than ever. Other improvements include a new modern shopping center in Chitre (completed) and new hospitals in La Villa de Los Santos and Pedasi (underway). While a lack of large-scale homebuilders has slowed the development of some of the beachfront communities in this area, sales of lots remain steady and everyone is excited to hear rumors of a large builder from the city set to complete some projects that have already been started.
In the meantime, I believe that one of the best opportunities for investors in the Azuero Peninsula this year will be picking up distressed/foreclosure inventory from existing developments such as the Azueros project in Pedasi. Resale prices in some cases are currently below pre-construction prices. We have also seen a boost in the amount of investors looking for parcels between 2 and 20 acres for larger home sites, organic farming and other sustainable living ideas. Unlike beachfront property, even ocean-view parcels of this size in the peninsula remain relatively inexpensive and offer an opportunity for later sub-division and development.
Part F. Sellers in 2012
So called “market priced” properties are not going to sell in 2012. The Internet has leveled the playing field, and although many of the best deals are never published, the buyer in Panama is becoming much better informed than he/she was five years ago.
Your best bet as a seller is to work with as many agents as you can because most publish their listings on one of two classified sites and then sit and wait for the phone to ring. There are a handful of agents in the city and beach areas who know how to market their listings and have a steady supply of international and local buyers, so do your homework before listing with every agent you come across. Even in today’s competitive market, many agents will still try to tack on exorbitant commissions (anything more than 6% will kill a deal), and end up alienating any potential buyer to the point of them walking away from the deal not because the property or price wasn’t right, but because they didn’t have confidence in their agent to get the job done.
Pricing, staging, and creative marketing will get your property sold because – mark my words – there will be buyers in 2012. The problem is, there will also be a lot more sellers, so make sure you’re working with the right agent(s) who can get the job done for you. If you don’t have an exclusive arrangement, don’t expect a phone call or email after every showing. Stay on top of your listing agent to make sure that the property is getting promoted like it should.
Section IV: Conclusion
2012 will be a very interesting year for the real estate market in Panama. Time will tell how increased supply (and demand) will affect prices but in the end, Panama remains a very attractive place for both inventors and end users of real estate. The New York Times just named Panama the #1 tourist destination to visit in 2012, and if only 1% of the tourists decide to buy something here, that may account for any extra inventory.
The Economist compared Panama to Singapore and we’ve heard similar comparisons to cities like Seoul in the 80’s. If these predictions are true, this could be the emerging city in Latin America in a few years…and just image what that will mean for real estate values. The key in any real estate transaction is having the team to support you and we are always available to provide thorough, well-calculated suggestions on buying or selling property in 2012 and beyond!
That was one hell of a real estate report. Good job. Read the whole thang.