Friday, October 25, 2013
Boquete, Panama, is often painted as a sleepy highlands town - a place where nothing really happens. That’s a big part of the town’s appeal to the North American retirees who choose to make Boquete their home.
But there are some big stories in the news right now that affect Boquete: an airport expansion and a new highway. What impact will they have on property prices?
In September, Panama’s president inaugurated a new 4-lane highway connecting Boquete with the city of David. The road isn’t completely finished, with the completion date set for the end of the year. The work involved the construction of new bridges, upgrading old ones, widening some sections of road and re-surfacing it. It’s a big government investment of $119 million. And it’s not the only one.
The ribbon-cutting ceremony at David’s newly-expanded international airport took place in January this year. I flew there a month later. The airport has a shiny new terminal and a longer runway.
The airport stirred up a lot of excitement. I’ve seen posts online talking about direct flights to Miami, to Dallas, to Houston, to Canada. But I don’t think that’s likely to happen in the near future.
But it will make it easier for a local airline like Copa to offer flights to David from the international airport in Panama City. That would make a big difference to visitors and expats traveling to Boquete. Right now, passengers land in the international airport. Then they need to travel across the city to the little domestic airport to catch a flight to David. It’s not a long trip but it can take a lot of time to cut through the busy city traffic. And it adds to the cost. You pay for two flights, the international flight plus the domestic one, and the transfers across town.
If Copa did start flights to David from the international airport, it would cut out the cross-city transfer and should cut the ticket cost, too.
Of course, our main interest is the impact any of this will have on property values. For now, I don’t think the airport expansion will have a big impact. But it will certainly make Boquete easier to get to.
The new highway, on the other hand, will make it much easier to live in Boquete. The town is now a short 25 minutes from the hospitals, big supermarkets, hardware stores and movie theaters in David.
The city of David is growing commercially. With the new road, Boquete looks more attractive as a weekend destination for the middle-class professionals based in David. David is a very convenient city, but it’s also hot and humid. It’s refreshing to escape to Boquete’s cooler climate. The new road makes it possible to commute from Boquete to David.
A big influx of North American buyers snapping up second and retirement homes triggered a boom in Boquete’s real estate prices. New communities sprang up, selling big luxury homes and large lots.
Today, many of these communities see stronger demand from Panamanian buyers. They’re changing their product to suit this market. They’re building smaller homes and offering smaller lots. One community reports strong sales in the last three months – selling home sites to well-heeled locals and professionals based in David.
For re-sales, pricing in Boquete has dropped from its peak in 2007-2008. Sellers today are more realistic with asking prices.
That’s why you can buy a new three-bed house in a private community with access to a swimming pool, tennis court and squash court, for $165,000. I’ll write more about this property tomorrow. In the meantime, you can read more about Boquete and how to see it first-hand here.