Lower Real Estate Investment Costs in Panama

PRLog (Press Release) - Dec 19, 2008 -
The reduced  cost of electricity, gasoline, and construction materials is expected to fuel a  renewed real estate boom in Panama.  Panama  has just announced reduced electric costs and has seen the price of gasoline  drop to half of last summer's costs. As reduced production and transportation  costs move through the supply chain Panama expects to see a substantial  reduction in inflation in 2009. Lower prices are expected to recreate many of  the initial conditions of Panama's  real estate boom.

Panama Real Estate Boom

Panama's ten year old real estate  boom thrived on the highest per capita foreign investment in Latin   America and a flood of North American retirees taking advantage of  low prices and easy residency requirements. The boom had slowed with inflation  in Panama  driving up prices.

The  End of Panama  Real Estate Inflation?

The  cost of real estate investment in Panama is heading down. The lower  cost of electricity, transportation, and construction materials will make  construction projects less expensive.

Lower   Panama  Electric Costs

Panama’s government is about to  announce a reduction in electric costs starting January 1, 2009. The new  electric rates will be based on a projected $50 a barrel cost of oil.
Previously,  Panama's  President, Martin Torrijos, announced that the fuel surcharge on electric bills  is going away. For the average client electric bills are expected to drop twenty  to twenty-five percent in the first months of 2009 based on the surcharge  removal.

In  addition, Panama  subsidized the electric bills of homeowners using less than 500 kilowatts this  last summer. Businesses and construction projects did not get a break. Thus the  announcement of a recalculation of electric bills will directly help those  using larger amounts of electricity, including the many large construction  projects that dot Panama City's  skyline.

Lower  Cost of Construction Materials

Lower  demand is reducing the price of basic construction materials such as Portland  cement and structural steel. ABPanama, a  corporation registered in Panama,  believes that the continued demand for housing, the availability of credit in Panama, and  lower construction costs will continue to attract real estate investment.

ABPanama  believes that the construction boom will continue in Panama at a slightly reduced pace.  Current high end real estate prices have leveled off creating historic buying  opportunities.

Panama Real Estate Investment

Panama’s economy has been growing at  ten percent a year more of less for several years and is only expected to dip  to 6.2% gross domestic product growth in 2009. Panama's continuing growth has  become more broadly based than for much of its history. The United States ran the Panama Canal, and some say  Panama,  until the end of 1999. The USA  has been Panama's  largest trading partner, investor, and patron. Bit by bit this is changing and Panama  is establishing trading relationships, especially free trade relationships,  throughout the globe.

With  the increasing prosperity of Latin America’s middle class Panama has a  larger retail consumer base for its free market economy. As North Americans  deal with credit concerns a home Panama  is soliciting business in Europe and Asia. For  example, the developer of the upcoming Panama Pacific Development Area  megaproject is Great Britain's  London and Regional  Properties.

Local  experts such as ABPanama believe that the  current collection of forces is recreating the conditions that started Panama's  real estate investment boom.
Follow  this link for more of ABPanama's thoughts  regarding real estate investment in Panama today.

Photo:
http://www.prlog.org/10157887/1