When will the bubble burst?
I am a foreigher living in Cartagena and almost every day I can found driving past some of the most expensive real estate in Latin America. I often speak to my wife, or more exactly thin out aloud, and ask who actually has the money for these properties? Or, Who in their right mind would actually buy one?
You see, Cartagena is a lovely place. I live here and am very happy, we've got it all: sun, sea, nature and a laid back lifestyle, but all thgis comes at a price. I don't actually live in downtown Cartagena, but a short drive away along the beach. Here for instance land prices tend to double in value every 2-3 years (buy now or it will soon be too late). In my area (Boquilla/Manzanillo) there are numerous up-scale resort developments currently being built, very nice too. But the prices are really high! Over US$400,000 for an 1800 square feet apartment! You do also get a balcony for that price. How about US$350,000 for a 1600 square feet house? In my modest opinion, these prices are fine if you actually want to live here, but I honestly can't see these prices rising much higher in the near future, and you can forget about using this kind of real estate as a rental property -- you'll never get a monthly 1% + return on your investment. By the way, not to boast, but if you buy something right you can almost get a 2% monthly ROI here in Cartagena.
So many apartments, houses, 5 star hotels and boutique resorts are going up I just wonder when the bubble will burst? Don't the builders know that there is a recession in Europe and USA, and millions of COlombians were hit by a nation wide pyramid scam just recently. So, in short, there isn't a lot of money going around -- but these places keep on going up.
Just thinking out loud to anyone who wants to listen. What do you people think?
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