What Gives With The Nicaragua Real Estate Market?
Over the past couple of months I’ve met a number of foreigners looking for property in Nicaragua who voiced their disappointment that the properties they looked at were not discounted much. Their assumption was that with Nicaragua’s real estate market not as robust as it once was, there would be bargains aplenty.
The market is down for sure, but prices don’t reflect this. Here’s why…
Most of the large tracts of land and many developed properties in Nicaragua are owned by wealthy Nicaraguans who are used to having to wait to sell a property. Potential sellers acknowledge that the market is down, but they’re unwilling to discount prices, choosing to wait out market downturns. That said, there are always owners who have to sell quickly and will sell at discounted prices. The trick is to find these motivated sellers.
Another factor contributing to making the Nicaragua real estate market appear overpriced is that what’s advertised for sale is not necessarily for sale. Often owners will offer their property for sale at a price that’s too high to be taken seriously by anyone knowledgeable. I assume these sellers are hoping a sucker will come along and overpay. Unfortunately it happens often enough for property owners to keep putting overpriced real estate on the market.
Peculiarities of the Nicaraguan real estate market.
Those properties that are reasonably price are not necessarily going to be sold by the seller for the price suggested. Sellers will ask for a reasonable amount but then refuse to accept it if someone actually wants to buy their property. I’ve experienced this myself and it’s annoying. The assumption on the part of these “sellers” is that if someone is willing to pay the price they are asking, then they’re not asking enough. These “sellers” are a waste of time.
The solution to time wasters is to have the word spread that there are buyers if a property can be purchased at a reasonable price. Nica Investments does just that and we’re constantly offered properties someone wants to sell.
Caveat Emptor (Buyer Beware)
A good 25% of reasonably priced properties are either outright fraud attempts or the properties can not be sold because the titles are too muddy. Once a con artist actually offered me a parcel of land to pitch to clients that included five fairways of a neighboring golf course within the boundaries of the offered parcel. It was news to the owner of the golf course that someone was offering a portion of it for sale.
Another 50+% are priced ridiculously high and nothing but a waste of time to even talk about. I handle these as diplomatically as possible while I show the “seller” the door.
Twenty to twenty-five percent of properties offered for sale are well priced. Unfortunately, half of these have title issues or some other negative factor that makes them impossible to take ownership of. The remaining properties that are well priced, with owners motivated to sell, and clear titles are excellent opportunities. These properties I immediately try to match up with existing clients’ desires. These properties usually sell within a matter of days, sometimes a week or two, so time is of the essence.
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