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THE FUTURE OF CARTAGENA’S REAL ESTATE MARKET?
The Opinion of Paul Juan, October 27, 2008.
Prospects, clients and friends frequently ask me questions regarding the mortgage, housing and deepening financial crisis which began in the United States and now effects various degrees, around the world. Most importantly, they are interested in Cartagena, and Colombia.
We experienced a downturn of real estate sales beginning in 2007 and this trend continues in 2008. This is attributed to two main factors: the revaluation of the Colombian Peso, the oversupply of properties, However, when compared with other realty markets in Colombia, our city, principally because of personal safety and our positive international recognition, is fortunate.
Oscar Borrero, a real estate professional based in Bogota, believes this cooling period may extend a couple of years. Importantly, he predicts that the Colombian Economy "will not enter into serious recession."
In the Colombian mortgage market there appears to be no serious risk of non payment, which continues the housing crisis in the United States. The Colombian government has also shown fast response in both consistency and flexibility, in managing the countries economic, banking, and monetary policy.
After the boom of 2003-2006, Barcelona de Indias, was perhaps, based on location, the last project which met with rapid response in successful pre-construction sales. Here in Cartagena, they presented a novel market product: suburban houses.
Now there are good opportunities to buy at below market prices. Many international buyers who bought with speculative investor or even "flipper" purposes, are in need of money. Most will now sell at their same purchase price, yielding zero profits. Many of these properties will sell in a reasonable time, depending of course, on their correct purchase decisions, which primarily should have been based on good locations.
Currently there are fewer international "investment" buyers. I sense however, that sales will steadily increase as more international buyers correctly assess their own local situation when compared with the favorable over-all stability and low-cost-of-living in Colombia.
The Colombian government expects NO revaluation. Prices of new and re-sale properties located in good areas, with good design and construction should remain stable. Historically, in the world wide recession of 1999 property prices, Cartagena prices did not drop. I feel that this maybe a good historic indicator that prices here in Cartagena will remain firm.
My Sales Office, here in Laguito, experiences slower traffic. My bi-lingual Internet Home Pages continue to provide daily current changes, tips, and important information on more than 200 good properties. International and Colombia visitor statistics remain strong and E mail interest, less than in the boom years, is keeping me busy.
E-Mail: email@example.com. Phone Call Reception: Mon Thru Friday 9:30am - 1:00pm and 2:00pm - 6:00pm. Saturday 9:30am - 1:00 pm.
Office: Bocagrande, Cra. 1 Calle 13 Edificio Cartagena de Indias - Local 1. Tel.: (57 5) 665 0515. Celular: (57) 311 660 2756. Cartagena de Indias, Colombia.
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