Nicaragua is down-to-earth and authentic.  There's not much of the glitz you’re starting to see elsewhere in the region.  The tourism minister likes to say that Nicaragua has everything except snow.  That may be the case but it’s still a country searching for a stable identity on the world stage. 

One thing everyone agrees on is that Nicaragua is beautiful.  The country has magnificent beaches known for their world-class surf and pleasant year-round sunshine, soaring volcanoes, huge freshwater lakes and historic colonial cities.  Nicaragua’s  strong year on year growth in tourism visitors is testament to this appeal. 

Cost of living in Nicaragua is cheaper than in Belize, Costa Rica or Panama.  The flipside of this equation is that GDP per capita is among the lowest in Central America. Nicaragua also scores at the low end in indicators such as the Human Development Index (see chart), Index of Economic Freedoms and Transparency International’s Corruption Perception Index.  Review key indicators for Nicaragua.

An 'early-in' market for Nicaragua real estate?

Browse the top property listing sites and you'll find surf real estate, ocean view properties, historic colonial homes in granada, beachfront lots, vacation homes, beach houses, beach condos, oceanfront property and so on.  It's an exciting market with a great deal to offer.  Promoters tout Nicaragua real estate for sale as representing an ‘early-in’ market at the beginning of a growth phase.  It may not stay at this point in the curve for much longer.  Nicaragua has already seen significant growth the past few years, partly helped by inexpensive prices, a reputation as a safe country, growing tourism and increased air connections with the United States.

While poverty reduction and economic development still pose challenges, the country has enormous potential for a positive future. Right now, some commentators are wary of Nicaragua given the rhetoric from President Daniel Ortega and his close relationship to Hugo Chavez the controversial leader of Venezuela.  But others are saying that Nicaragua real estate presents a huge buying opportunity with developers releasing property at never-to-be-seen-again prices. 

Large scale road improvements are taking place in key tourism areas and the rolling black-outs of 2006 are no more.  Nicaragua has complied (unlike many other nations) with prescribed IMF demands for cutting its deficit, implementing structural reforms, and maintaining overall monetary stability.  This, together with the successful completion of negotiations of the Central American Free Trade Agreement is helping to drive the improvement of infrastructure, economic situation, and position in the global marketplace.

Real estate in Nicaragua: not immune to the global financial crisis

Our 2009 and 2010 data revealed that although asking prices for real estate in some of Nicaragua's master planned communities fell year-on-year from 2008, the international real estate sector did not experienced the large, across-the-board declines seen in the US, UK and other developed world markets.

A key reason for this is the undeveloped mortgage market in Nicaragua for international real estate purchases by foreigners.  As most buyers pay in cash there's no shadow inventory of foreclosures dragging the market down.  The low property taxes in Nicaragua have also helped. Still as sales rates slowed in 2009, some real estate developments have stalled and others are pulling back on more ambitious aspects of their master-plan.  Pre-construction and off plan properties, particularly in projects at an early stage of development, are still struggling as investors increasingly turn to lower risk completed properties in more established locations.

The one bright spot in the international property market is the growing sector of 'lifestyle buyers' looking for small, functional, turnkey property.  They're attracted by the low cost of living possible in Nicaragua and keen to pursue a life overseas away from the glare of what they perceive to be an increasingly predatory government style back home.  Developers who are able to shift their attention away from the speculator and address the needs of the lifestyle buyer should do well in the current investment climate.

Nicaragua property hotspots

The consolidation of the coastline in the south west of the country between El Transito and Costa Rica as the prime real estate zone, with San Juan del Sur as a pivotal center, is underway.  Over 80% of Nicaragua real estate projects in our survey fall within this zone which takes in the Central Pacific (due west of Managua and closest to the international airport), the Tola Riviera, the town of San Juan del Sur, the Maderas/Marsella area and the coastline south of San Juan del Sur to the border with Costa Rica. On offer are dramatic ocean vistas, secluded beaches and famed surfing waves. 

An important property hotspot away from the Pacific is the colonial town of Granada.  For the most part, the Granada market comprises individual colonial homes (both restored and un-restored) for sale rather then property within planned developments.

Our Nicaragua property page provides more information on price points for real estate across different categories.  Subscribe to the Reveal Real Estate newsletter for more analysis of real estate in Nicaragua comparisons of property prices across Central America.