You many be on the look out for great affordable international real estate deals. During my Panama property search, I checked out some Pacific beach communities en route. My first stop was Chitre. So here are my findings that will be helpful for you real estate investors:
I took the new highway from Divisa. This recently-completed road is now four lanes rather than two and makes getting to Azuero quicker and easier. That’s the first of the changes I can see in this area..
Chitre is an important commercial center in the central region of Panama. It’s the capital of the province of Herrera. It’s not a quaint village or on the tourist trail. It’s got a lot of conveniences—banks, hardware stores, supermarkets, pharmacies and restaurants. It feels busy and thriving. But it’s a local town, driven by local trade, rather than tourists or expats.
There are a number of new commercial plazas under construction. New supermarkets are opening up. They’re not just catering to the lower end of the market. Riba Smith, a gourmet supermarket chain, just opened in Chitre. It’s their first branch in Azuero. It’s stocked with fancy pasta, fresh bread and produce, expensive wine and imported goodies.
The supermarket sits in the commercial center of a new residential community. It’s got a colonial-style hotel with a restaurant, swimming pool, sauna and gym. Owners in the residential community can use the hotel’s amenities and get a discounted rate at the restaurant.
Properties In Chitre, Panama
That’s downtown Panama City prices for a good neighborhood, not the kind of pricing you’d expect in Chitre. Despite this, the houses are almost sold out.
The buyers are local families looking for an upscale home in Chitre. They’re the kind of folks that drive new SUVs, send their kids to private school, hire a maid or a nanny or both. This is the newest, nicest project in the area. It’s got a certain cachet.
That’s a complete turnaround from three years back when the project launched. The sales manager admitted that many locals doubted if the project would sell at all.
I tried to figure out if there was any rental angle with the homes but couldn’t see one. Local real estate agents reckoned you might get $1500 a month on a long-term let for one of the furnished houses.
By the time you bought the furniture you were looking at gross yields of less than 7%. That’s if you paid cash for the property. And as the owner, you’d pay the monthly condo/association fee which would cut your profits even more. It simply doesn’t stack up.
The developer still has 15 condos for sale. They’re offering full rental management through the hotel. But to generate any kind of income, the hotel will really have to step up to the plate.
Travel Arrangements To Look For Deals
I stayed at the hotel. But that was only because I knew about the project. I searched for Chitre hotels on sites such as Tripadvisor, hotels.com and booking.com. I found several hotels. But this hotel was not listed on any of them.
I contacted the hotel directly to book. They wanted me to fill in a form, send scanned copies of my credit card, front and back, and a copy of my passport. Needless to say, I didn’t want to do that.
The other options were not attractive either. They asked me to wire a 50% deposit. The stay for one night was only $110 with tax. I’d have paid almost as much in wire fees as the deposit.
I ended up paying the deposit to a local bank and scanning the receipt to the hotel. This is not an option for anyone that doesn’t live in Panama. The hotel needs to make reserving as easy as possible. They also need to get a presence on big sites like Tripadvisor. Only then will they start to get guests in any real numbers.
Chitre isn’t the prettiest town in Azuero. But it’s an important commercial hub that’s definitely on the up. You can still find low-priced property in Chitre. A nice, local-style home with decent finishes in a good neighborhood would cost from $80,000-$120,000. But you’ll also see fancier homes, with swimming pools and all the bells and whistles, for $300,000 plus.
Investing In Chitre, Panama
As my Panama property search continues, my conclusion on Chitre is that it’s a convenient town with a commercial focus. It’s not a hot spot for foreign retirees or second-home buyers. There isn’t a strong investment angle. But it definitely showcases Panama’s increasing prosperity and the rise of a wealthier middle class.