Colombia, especially for those unfamiliar with or uninformed of the country's recent history, may only be seen through the lens of difficulties with drug trafficking and terrorism. But a confluence of factors, from a much improved security situation over the past decade to a stable, growing economy, a bright light compared to those of many Latin American neighbors, has made the country, and its real estate market, hot commodities for previously skittish foreign investors.
"Colombia is poised for the greatest move of any country in Central or South America," says Rich Holman, founder and partner of First American Realty Medellin. "We're going to blow Panama and Costa Rica out of the water."
Previously, the beautiful, historic city of Cartagena was both the gateway and the end of the road for those interested in Colombian real estate, since it was considered much safer than bigger cities in the interior. But the country's economic expansion (after the serious bump of a worldwide drop in commodity prices), favorable exchange rate, growing middle class, and burgeoning tech scene—Facebook hosted its first international town hall in Bogota—suggest a market poised for sustained growth. Local real estate agents, buoyed by the potential for foreign investment in cities across the country, see it in even more direct terms.
"We can see a tidal wave that's coming," says Sam Miller, Managing Director at Colombia International Real Estate in Bogota.
Why Buy Here:
A confluence of factors has created the potential for a long-lasting real estate growth spurt. Colombia's recent history has kept away foreign investors, meaning the real estate market is relatively cheap, tied to the peso, and lacks the sudden inflows and outflows of capital that would radically swing prices. The fundamentals of the economy are very strong, and many have suggested this market is ideal for retirement homes (perfect climate, culturally rich cities) or investment properties (especially considering the tourist trade, expected to grow 4 percent annually for the next decade).
Jose Miguel Echenique, managing director of Engel & Völkers, sees upside in nearly every major city in the country, including Barranquilla (a top financial and trade center on the Atlantic coast) as well as Cartagena (an attractive destination for local and international tourists filled with high-end developments).
Brad Hinkelman, GM of Casacol in Medellin, believes that city is unfairly maligned. Those unfamiliar with the city may focus on its turbulent past, but that's only meant that it's undiscovered. Neighborhoods such as the stylish El Poblado slip under the radar.
"It's the Manhattan of Medellin," he says. "It's the most developed and tourist friendly, and that's where most people want to be."
Miller says the up-and-coming spot in Bogota right now is Chapinero Alto, in the northern part of the city, an eclectic neighborhood boasting Brooklyn-style restaurants, upscale amenities and indie coffee shops. Homes there may not be brand new, but there are old properties ideal for fixing up and smart investments.
"If you're an entrepreneur, it's a city that's starting to catch up and come up, after being held back for a long time," he says. "With a growing middle class and one of the largest English-speaking population in Latin America, there are opportunities."
Developments to Watch For:
Echenique points to a handful of big developments in Bogota, including redevelopment along Carrera Séptima, as examples of the growth about to hit Colombia: the luxury Neos Nogal apartment building; Torre Vitrum designed by Richard Meier, located near the posh Avenue Carrera; and La Resolana, located in El Refugio, by Escalar. High-end property in the city appreciated by 10 percent last year.
Advice for Foreign Buyers:
There's no limit to property purchases by a foreigner, fees and commissions are relatively low, and buying above a certain threshold means that you receive a permanent residency card.