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Panama real estate will be coming out of its slump by the end of the year. What is the shape of things to come in Panama real estate investment now that Panama has a new government and new plans?

Panama has a new government. Ricardo Martinelli and his Democratic Change Party handily defeated the old line PDR and took over the presidency as well as the National Assembly. Martinelli is filling his cabinet with individuals with business experience.

As with all new governments there are the long term plans and then there are the details of setting up to run things. There is no question that Mr. Martinelli has the ability to conceive of good things for Panama and to have the will to carry through. The two questions are these. Will there be problems in implementation as Mr. Martinelli needs to work through Panama’s bureaucracy to get things done and how long will it take to see changes?

In reality they are the same question. Will things change and, if so, how fast.

Mr. Martinelli has talked about a subway system for Panama City. The bus issue seems to have been put on the back burner. The canal expansion is going forward and waiting to select the winner of bids for the new locks.

Panama Real Estate and the New Government

Part of what will happen with Panama real estate has little to do with the government and a lot to do with recovery elsewhere. However, long term indicators such as the purchase of raw materials indicate that a recovery is ready for next year. Also shippers such as Maersk are raising their rates as they see more orders and more volume. As North America recovers more buyers will show up in Panama.

A large part of Panama real estate’s prospects has to do with investment and jobs and new mega projects. The Panama Canal Expansion is in full swing and will continue to generate jobs and income through 2014. Projects like a subway system will take time and not bear fruit until Mr. Martinelli has served his five years as president.

It takes time to develop huge projects such as a subway system. Look at the Panama Canal Expansion, which was passed five years ago in an initiative and is till five years from completion. Thus we can expect to see long-term economic gains from a subway system but none of that will help the economy or real estate investment this year.

In the meantime let us not forget that Panama is not in a recession. Panama expects to see its economy grow this year albeit at a lower rate than in the last decade.

For the wise investor, this is an ideal market in Panama right now. Panama real estate prices have paused on their upward climb and there are some great deals. If you are interested in Panama real estate please come to see us at ABPanama. We have over 23 years experience managing real estate portfolios and do business throughout Panama.