An increase in the supply of offices in Panama City is putting downward pressure on occupancy levels.
According to the consultant Indesa, the occupancy level in the first quarter of 2011 was 95.4%, versus 86.5% for the same period this year.
Speaking about the topic, the Corporate Finance Director of Indesa, Francisco Escoffier, said that, "In the next couple of years it is not expected that the total demand for offices, including locally generated demand and the demand generated by the arrival of multinationals, will be enough to absorb new supply coming, so the available inventory will go up and occupancy will do down ... in the research occupancy means that there is physically one tenant in the property, which is a conservative definition. "
The Costa Rica Real Estate Chamber is preparing a specialized index for land prices.
As by explained Aleyda Bonilla, director of the Chamber, the indicator will combine information from the public registry, municipalities and inspectors and will initially serve to determine the cost of lots and then, in a second stage, will be used to list houses.
"According to the representative of the realtors, the first results of this price collection will be ready in the first quarter of 2013 and will include data only from the province of San José.
How much does a house cost that is 200 square meters, 3 bedrooms and 2 bathrooms, in an area of 3,000 square meters, in a middle class neighborhood?
The Central American Home price Snapshot, coordinated by Reveal Real Estate and Global Property Guide, reveals the sales price of similar homes in 12 real estate markets in Belize, Nicaragua, Costa Rica and Panama.
The National Council for Housing Promoters in Panama is made up of 22 Developers and 9 Banks, who are united by quality and accountability requirements.
An article in pa-digital.com reports that "57% of everything that is built in the Republic of Panama is developed by members of this union whose promoters have been in the housing market for over 50 years."
The fever for building construction has not affected, for now, rental prices for office properties in Panama City.
Although there is in the country an inventory of office space which is enough for over six years, the construction of large buildings for this type of business has not stopped and both vacancy rates and prices are stable and have not impacted the market, reported Capital.com.pa.
The Panamanian group of companies, Convivienda projects sales in 2012 amounting to $665 million with the delivery of 7,429 homes.
The director of the national council of housing developers, explained that the with the Preferred Interest Act raising the ceiling on the value of homes which can benefit to $120,000 will help... "the middle class above all, because there are more chances to get a house for a longer period", reported Panamaamerica.com.pa
In Guatemala, where the housing deficit is 1.5 million units, they only manage to produce between 20,000 and 50,000 homes a year, a situation that is forcing authorities and the private sector to find solutions.
The minister of Communications, Infrastructure and Housing (VIC), Alejandro Sinibaldi, told Lahora.com.gt that at present, the housing deficit in Guatemala is 1.5 million units.
Prices are rising, and some areas stand out above others for higher growth rates, with no signs of a housing bubble.
Mass construction in Panama, particularly in the capital, is concentrated in some residential areas where prices are rising and it is advisable to monitor this situation. However, this does not constitute a threat of a housing bubble in the view of some economists.
The economic and tourism boom has created an inordinate amount of investment in hotels, which is threatening to lower the occupancy rate to unsustainable levels.
The opening of more than 20 hotels has been announced for 2012, adding 6,000 rooms to the inventory offered by Panama, and representing an annual increase of 300% in the hotel supply, while the increase in the number of visitors to the country during 2011 grew by - 13%, which although significant, is far below what would be needed to keep up the hotel occupancy rate, which currently stands at 66%.
An NAI Costa Rica Report for the third quarter 2011, gives analysis categorised by supply, demand and prices, and an evaluation of new projects.
Extract from the report:
The office property market is stable with an availability rate of 8.9%, up 1.1% from last quarter, due to the steady inflow of new office centers to the market.
Investment projects to be initiated or already in motion demonstrate that there is more movement in the credit sector and there are several major projects under construction. Banks are more willing to invest, contrary to what was seen 24 months ago where investment was totally paralyzed.
According to their press release, Panama’s Superintendency of Banks’ study of the real estate market shows growth in the construction sector.
For the fifth consecutive year, Panama’s Superintendency of Banks circulated a survey among those banks with most lending activity within the construction sector in order to analyze the housing market. On this occasion, as well as requesting information regarding single-family housing projects and apartments, it included financed projects which fall into the category: Other Buildings, Infrastructure and Commercial Properties.
The crisis in Europe, North America and Venezuela is dampening the dynamism in the real estate sector whose sales depend heavily on these markets.
In the first six months of 2011, of the total amount of real estate transactions only 2% related to the sale of luxury real estate projects.
The executive director of the National Housing Promoters (Convivienda), Elisa Suarez Gomez, said that building of luxury residences has been reduced in the first half of the year. "... In luxury segments, those costing upwards of $350,000, sales depend heavily on the foreign market, so the crisis in European countries, Canada and Venezuela, has made for significant changes in the sales process", said the director to Panamaamerica.com.pa
A proposal has been presented to the bondholders to extend the term of the debt.
$220 million in bonds issued in 2007 to build a luxury apartment building called Trump Ocean Club, owned by tycoon Donald Trump, will be restructured before the next payment of debt, which is due on November 15.
This is the date when Newland International Properties Corp.
Costa Rica lacks housing for the middle-income sector.
Funding is not to blame. After passing the most severe part of the financial crisis, banks are now offering home loans at favorable conditions and accessible to incomes of all spectrums. The problem is that there is insufficient supply in the housing sector in the ranges of $70 thousand to $80 thousand.