Investing In The Boquete Area

Boquete is truly a unique area, different from much of the rest of panama, its cooler climate, abundance of wildlife and luxury housing make this area very popular with many retirees.

The uniqueness of boquete also breads a unique real estate market. Land values have rocketed here for the last few years with no sign of stopping. Currently, you can still find land out of town for less than a $1 a meter, but many of these pieces do require additional infrastructure, possibly a new road, a water supply or mains electricity. At the other end of the scale, some land in the center of boquete is available at $100+ per meter.

RE/MAX can help you invest your money.

The boquete area offers many different investment opportunities. Some people choose to buy large pieces of the -$1 land and flip it at a later date when more infrastructure has been installed. Other prefer to install their own infrastructure with the hope of increasing the value of their investment.

If your piece of land is large then you may wish to subdivide your plot into smaller ones and sell them separately. This can be quite simple for a smaller number of new titles,(depending on access) but larger projects require the submission of a master plan which requires a little more time and paper work.

A currently attractive option is to purchase a piece of land and construct a house on it. When the house is finished you can sell it or even rent it out. Currently there is a definite demand for finished housing in boquete, for rent and for purchase. Many ex-pats are looking to stay here for a few months before committing to buying, the booming hotel trade is a testament to this. It is difficult to find a rental here and even harder to find finished 'american standard' homes for sale. The Valle Escondido gated community offers short and long term rentals, along with many finished homes for sale, but expect to pay considerably more there then you would anywhere else.

The building trade here is booming, trying to fill the demand. Construction prices here are constantly on the rise due to the demand for Boquete's labor and the nationwide demand for building materials. The cost to build a house varies greatly according to requirements; a home with high end 'US standard' of finishes and fittings can vary from $55 to $75 per square foot, costs for simpler construction using cheaper materials can be much lower. Typically, expect $60-$70 per square foot, much less, and its probably too good to be true.

Once you have finished constructing your house you may wish to rent it out. A good standard, 2,000 sq ft house can achieve around $1,200 per month (obviously depending on location etc.) in the current climate. So what return can you expect?

Here's an example:

Quite amazing huh? Of course, you have to wait until the house is finished before you can rent it out (probably 1 year), and capital appreciation is only based on current climate, this obviously may change, but in principal, what an amazing return.

Now what if you built your house and then sold it? A well finished, 2,000 sqft house in a good position could be sold for around the $225,000 (obviously, again depends on many factors). If you did receive that much for the house, then that would be $60,000 above the land and construction price, having only initially invested $42,000.

Of course these figures are very much liable to change and each case is very different. Talk to us first before making decisions and we can help you make the right choice. Our agents can advise you on current rental rates and approximate sale values. We can also give you advice on how to increase these figures and how to improve the return on your investment.

If you would like any more information on investing here, please email us at info@panamaparadisefound.com, we'll be more than happy to help.

 

NOTE: All facts and figures contained on this page are only examples and are true to the best of our knowledge at the time of publication and must never be taken as absolute certainly. RE/MAX Paradise Found takes no responsibility concerning the information presented on this page.

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