Sales Increased During Covid
In our last market update in September 2020, I mentioned that COVID-19 had increased interest in Nicaragua and created an uptick in sales from families and individuals looking to move and/or invest here. This trend has continued, and momentum has strengthened in the last six months.
Virtual buying has continued and increased as well. We’re seeing more buyers purchase property via virtual tours with limited power of attorney, which allows a sale to occur without the buyer stepping foot in Nicaragua. Contact us if you would like more information on how this process works.
Inventory is Low
Supply has not been able to keep up with demand, and my previous prediction of low inventory in 2021 has come to fruition. Homes priced below the $200,000 – $250,000 USD price point are being gobbled up, and there are now significantly fewer homes in this price range than at the beginning of the year.
There has also been a good amount of sales above the $300,000 USD price point in San Juan del Sur and the developments of Tola; equally, fewer homes are available in this price range.
Although there is a clearly higher demand for existing homes and condos, we also see an uptick in land purchases – from half a million dollar+ beachfront lots in Hacienda Iguana to ocean view lots for under $50,000 USD in San Juan del Sur. Many of these buyers plan to build immediately or in the near future, a change from the speculative land buyers from a few years ago and a distinct shift in the local real estate market.
Commercial Flights Available
We now have commercial flights to and from Nicaragua via Avianca, which has increased the number of visitors/tourists and allowed buyers to see properties firsthand.
No Lifestyle Restrictions
We are not back to normal levels, but the short-term rental market has been propped up by heavy national demand, and the long-term rental market has benefited as well from the increase in visitors who are here for extended stays: working remotely, a full-time move, or renting. At the same time, they search for the right property.
Increased Travel = More Sales
Travel restrictions have been one of the biggest hurdles for buyers looking to come here but can’t. Inventory will continue to decrease as we see more flights open up with the global vaccine campaign, which will drive more North Americans and Europeans to Nicaragua, allowing them to see the properties they’ve been viewing online in person after almost a year of waiting well, at least the ones that are still available.
Inventory Will Remain Low
Right now, we are not seeing any large-scale development where 5-10-20 homes are being built at a time. And when that development does begin, buyers will be paying cost +. This means that the only new homes priced below replacement cost that will come on the market are resales from existing homeowners looking to exit their investment – a number that has decreased as the need for a vacation or 3rd home has become more evident in a post-COVID world. It’s important to note that these homes will be listed with higher price points to reflect the scarcity in the market.
The World Has Changed Forever
The world is different. Many people have discovered that they can work remotely. Others have decided they want to work to live and not live to work. Some are ready to pursue their entrepreneurial dreams in a tropical paradise. COVID has permanently changed the way we live, and this new lifestyle falls in line with what Nicaragua has to offer — interest and intrigue in Nicaragua will continue its upward trajectory and increase demand in the real estate markets of San Juan del Sur & Tola
Remember, current inventory is low, so don’t miss your opportunity to buy a home below replacement cost value!
For more information about living and investing in Nicaragua, please get in touch with us for a free consultation!