Continental Magazine
July 2008
“The market is strong and steady,” says real estate developer Tim Welbes.
Obviously, those are words that would make many real estate brokers, homebuilders, and buyers and sellers jealous, or certain that the speaker was crazy. But the truth is, while the subprime debacle has been a drain on the economy and a cause of pain for many, it’s not the whole story. Certain areas of the United States, and the rest of the world, are enjoying a solid real estate market, and there are unique investment and second-home opportunities out there, if you know where to look.
As co-president of the Woodlands Development Company, Welbes follows the news in real estate with a passion. He says that whenever he sees a television report or reads a news story these
To buy some duplexes, put some money in them and rent them out and manage them as investment properties over a long period of time,” she says. It’s a different type of investment.”
It’s not just investors and those looking for second homes who can find a silver lining in the current real estate morass. Tyler also points out that people in the market for a new, long-term primary home – whether as the result of a job relocation, to get more space, or to move into a better school district – are also in a good position, particularly in areas where people are eager to sell. “It’s a good time to buy, if you can get financed, because there’s less competition with other buyers,” she says. “ You have more power to negotiate with sellers.”
Whether you’re buying a home for an investment, a vacation home, or a primary home – or, in fact, whether it’s a bargain price or a purchase during a boom market – one thing buyers need to remember is to do your due diligence, something Bromma says very few investors do. It includes actually visiting a piece of land or a home. At times, it is tempting to jump at a really great deal sight-unseen. Bromma says that happens more than you might expect. “Number one, see what the property is. Know what market you’re buying into, and visit that market and spend a week or two if you’ve never been there,” he recommends. “Get good local advice from real estate professionals and look at market trends, like what values have done over time. Those are the primary things, and investors mostly fail to do them.”
Looking Beyond the Border
Jack Studnicky is glad he doesn’t have to focus on making real estate sales in the United States. A vice president with the Miami-based luxury broker International Sales Group, Studnicky fixes his attention on drawing buyers to the Trump Ocean Club in Panama City. “The U.S. is flat,” he says. “We are making scant sales, and the sales we are making are at discounted prices, as much as 40 percent less than 2005.”
Not so overseas. For instance, Studnicky says that sales for the Trump Ocean Club – a high-end development with a hotel, casino, residences, marina, and spa, located right on the water on Panama City’s Punta Pacifica peninsula – broke records this past March, and then again in April. “We are selling at great speed, and a lot of that has to do with the fact that Panama is a hot market.”
Indeed, Panama – like much of the rest of Central America and the Caribbean, including parts of Puerto Rico, the Dominican Republic, Belize, Costa Rica, and even Honduras and Nicaragua – is still very much in the midst of a development boom, as American baby boomers look for investment properties or an affordable place to retire and Europeans seek to take advantage of their strong currency to snap up bargains.
Panama is currently a popular destination for investors and buyers for many reasons, including good infrastructure, a stable government that offers generous incentives to both developers and expatriates, and, thanks to the Panama Canal, a high level of familiarity with foreigners, particularly Americans.
Richard Kiibler, a vice president of operations with Six Diamond Resorts, says it was the stability and inviting atmosphere that led his company, which is in the process of going public, to launch its Central American activities in Panama. An even more compelling reason to launch in Panama, he adds, is the country’s spectacular natural settings – from t he mountain highlands near Boquete to Panama City, which has been compared to Miami for its culture and vitality, to the quiet tropical islands of Bocas del Toro in the north, near the Costa Rican border.
Six Dianonds’ first project in Panama, Palacio del Mar, will be in Bocas del Toro, on a strip of land between Almirante Bay and the Caribbean. “You can come out on your front porch and see the sun rise over the beach, and you can go to the back and watch the sun set,” Kibbler says. “It’s a spectacular piece of property.”
