Comparison shopping: An analysis of purchasing destinations for Nicaragua real estate
The Nicaragua real estate market is hard to generalize on a national level. It’s made up of many micro or sub-markets. In this article we deep-dive into some of Nicaragua’s most important sub-markets or ‘purchasing destinations’ to draw out the kind of data we hope will help buyers and sellers make more educated decisions.
In Nicaragua the main purchasing destinations are located on the south western part of the Pacific coast. In particular the town of San Juan del Sur, the area south of San Juan del Sur to the border with Costa Rica, the Tola Rivieria & Popoyo region and the Central Pacific Coast, due west of the capital, Managua.
Together these four areas have 80% of all overseas property developments in Nicaragua catering to the international buyer, making them a logical basis for comparison.
Mingle enough with real estate investors in Nicaragua and you’ll hear them expounding on the relative merits of different areas and asking questions like: “Is the town of San Juan del Sur with its local cafes, bars and restaurants a good place to invest. Or is Tola with its master planned resort-style communities a better option?”
Ranking purchasing destinations by price
The Central Pacific Coast of Nicaragua tops the list for median price/sqft for both serviced lots ($11.75/sqft) and condos ($206.30/sqft). Several large scale resort communities are planned in this area, including 3 championship golf courses.
The area South of San Juan del Sur, towards Costa Rica is the most expensive for single family houses ($173.03/sqft), followed by Tola Riviera & Popoyo ($164.78/sqft).
San Juan del Sur receives the most press and has the most international tourist visitors. But it is not the most expensive purchasing destination for any property category. (It comes a close second for condos.)
San Juan del Sur has certainly seen a rush of development in recent years and is home to 1/3 of all real estate projects in Nicaragua focused on the international market. Perhaps developers have been doing the math on buying a lot in the San Juan del Sur area (5th most expensive location) and developing this into condos (2nd most expensive location).
What about trends over time for San Juan del Sur?
The median price for lots, condos and single family homes has fallen in San Juan del Sur by more than the average across the country. For lots, the overall fall in median price between 2008-9 for the country was -3.53% (in San Juan del Sur the median price fell -9.38%), for condos the overall fall was -6.40% (in San Juan del Sur the drop was -9.90%) and for houses -3.41% for the country compared to -11.98% in San Juan del Sur.
Some buyers will see this as a clear buying opportunity given San Juan del Sur’s continuing status as the pivotal center for property options in Nicaragua. Others a sign of over-supply. What do you think? Let us know in the comments below this post.