Construction Awaits Better Times

Expanding to $150.000 the range of homes with preferential interest and guaranteeing real estate leasing are two of the changes that could boost a recovery of activity in Panama.

Monday, November 19, 2018

Construction in the country has reported a downward trend in recent years, however, representatives of the Panamanian Chamber of Construction (CAPAC) expect that with the arrival of a new government and the start of major works such as Metro lines 4 and 5, the sector may re-emerge.

You may be interested in "Central America: $270 Million in Road Projects"

Héctor Ortega, president of CAPAC, explained to that "... at this moment, the scenario is not the most favorable, but the industry has always been thinking about generating tools to motivate the activity development. There is a deceleration, and these are important figures if we see it every year, however, bureaucratic issues are increasing the final cost of housing."

Ortega added that "... construction is directly related to the condition of the economy, 'there are few sectors growing, the purchasing power of buyers is important and if there are not there will be no sales, plus there will be a significant rise in mortgage interest rates."

Also see "Public Works: $1.1 Billion in New Projects"

According to the General Comptroller of the Republic, in the first nine months of 2018 the cost of new construction, additions and repairs fell 40% over the same period in 2017, confirming the trend shown since last year.

Regarding incentives for the construction of social housing, in July it was reported that with the objective of more companies investing in social housing development, the Varela administration decided to raise from $50,000 to $60,000 the price of housing solutions of social interest to be built in the Panama and West Panama provinces.

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More on this topic

Construction in Panama: Better Expectations

July 2019

President Cortizo announced the implementation of a plan that contemplates expanding the preferential interest rate for homes with prices of up to $180,000.

During his inauguration, Laurentino Cortizo announced that he will implement a plan to reactivate the construction industry, which includes the extension of the preferential interest in different ranges for housing up to $180,000, the presentation of a real estate leasing bill and exemption from transfer tax for the current inventory of housing, among other actions.

Real Estate Boom in Eastern Panama

December 2017

Greater mobility provided by Line 2 of the Metro in the East of the capital explains the growing attractiveness of the area for real estate development, especially for residential construction.

As of October 2013, the total amount of area processed for new residential buildings in the province of Panama amounted to 903,000 square meters, while in the same month in 2017, just four years later, the figure exceeds one and a half million square meters.

Panama: Boom in Construction Loans

April 2013

In January 2013, banks granted the construction sector loans worth $2.92 billion, which is $89.6 million more than in January 2012, when the figure was $2.83 billion.

These type of loans, represent 11.45% of the loans granted by the National Banking System, which adds up to a total of $33.5141 billion.

The Metro Generates Real Estate Opportunities

October 2011

Great interest is being taken in land and homes in areas near to the new Metro stops.

Real estate industry representatives agree on declaring areas where underground stations will be located "gold mines".

The price per square meter could rise to the same values or even higher as those currently paid on Avenida Balboa, the area considered the most expensive in Panama.

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