According to the latest report from Convivienda, the number of new residential units sold rose by 7.5% in 2016. In 2017, units sold are expected to rise by 10%.
Convivienda is a private conglomerate of real estate professionals, real estate companies, and banks, focused on the development of new residential housing. The conglomerate is responsible for more than 60% of new housing sales and more than 75% of residential development in Panama City.
Convivienda reports the 10% growth expected in 2017 translates to almost $1 Billion USD in total sales.
The Convivienda 2016 annual results, released last March 15, also showed a strong Panama real estate market for 2017. During 2016, most new residential housing sales fell into the range of $40,000 to $80,000. The expectation for 2017 is that most new residential sales will fall into the range of $65,000 to $95,000.
Credit advantages for citizens fuel growth
Panamanians’ access to credit keeps fueling housing demand. The government has a 15-year subsidy program, called the preferential interest program, where buyers pay a lower interest rate towards the purchase of a new residential property.
For instance, for a $60,000 property financed at 5% during 30 years, the buyer will only have to pay 1% interest (plus principal) during the first 15 years. The government covers the remaining 4% interest – an 80% subsidy.
The preferential interest program is available only to Panamanian citizens, and foreigners aren’t eligible for a program such as this. Further, applicants eligible for financing real estate in Panama must complete their amortization upon reaching the age of 70.
What would happen to demand in the Panama real estate market if early retirees from the United States, Canada, and Europe had access to a 30 year fixed rate mortgage regardless of their age? We imagine a whole new world of Panama real estate investment would emerge.
Invest in Panama today – PanamaKeys is here to help
The article Panama: An Intelligent Investment Option identified the Real Estate sector as a major player in the local economy, and the 2016 Convivienda report confirmed it.
Panama continues to be an attractive investment option for foreigners looking to diversify their basket of assets outside of North America. Do you have questions about investing in Panama? Contact PanamaKeys today, and we’ll help you sort them out.
Did you find this article useful? Please share it with your family and friends!