House Hunting in El Salvador: $ 249,000 Coastal Home

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This low complex of villas surrounded by a lush tropical garden, steps from a private beach and beach club on the Pacific coast of El Salvador.

The property, covering a third of an acre in the beachfront community of Bahia Dorada, consists of two residences – one with two bedrooms and one bathroom and the other with a master bedroom.

The home, which is being sold furnished, is set in a traditional Salvadoran ranch style, with living quarters divided between indoor and outdoor spaces, salesman Anna Rooney said. Whimsical touches include vibrant walls and handcrafted textiles. The dining room, living room and kitchen are outdoors, while the bedrooms and several seating areas are indoors. The property also has a room for a housekeeper.

“Green spaces are indescribable,” said José Cortez, an agent for Oceanside El Salvador, which is listed. “It feels like you’re in the woods.”

From the street, a long walkway leads to the center of the property, past a 26-foot pool and adjoining gazebo with hammock and barbecue. A path leads to the center of the building, bypassing the covered open-air kitchen and living room. Adjacent to this courtyard is a bathroom, storage room and a housekeeper’s house. The kitchen has a central island with a granite worktop and a four-burner propane hob.

A passage splits past the kitchen to reach two buildings: on the left is a cottage with a bedroom and a living room. On the right is a two-bedroom, one-bathroom cottage currently being used by guests. Each room has a covered veranda with tiled floors, raised up a few steps.

Built some 40 years ago, the residence is about 1,650 square feet, excluding patios and terraces, and is constantly being updated, according to Ms Rooney. The roof was replaced this summer.

The private community Bahia Dorada offers an exclusive beach and pool within walking distance, as well as 24/7 security. The area is a surfing mecca. The surfing of El Mizat and El Zonte can be reached in 10 and 20 minutes. San Salvador, the capital and largest city of El Salvador, is about an hour and a half away, as is Monsignor Oscar Arnulfo Romero International Airport.

After years of low home prices due to a weak economy, banditry and political instability, El Salvador’s real estate market was booming in 2020 before the pandemic and travel restrictions stifled growth. But local brokers and other market watchers noted that the Central American country of about 6.5 million is recovering steadily, and more than recovering in the beach regions.

Aaron Varquero, founder and CEO of beach property company Oceanside El Salvador, said Salvadorans realized early on that in a pandemic they could own a beach home for the price of traditionally less expensive urban housing.

“In general, it will always be better to live on the beach than in the city,” said Mr Varquero. This desire, combined with the ability to work remotely, has pushed many Salvadorans to the coast of the country, especially to the La Libertad region, a 45-minute drive from the capital. “As soon as the economy reopened, the demand for beach homes rose sharply,” he said. “People started selling their apartments and investing in beach houses.”

He added: “There used to be only one or two houses a month. We now close five to six houses a month. ”

Prices in beach areas have risen correspondingly, up 15-20 percent from early 2020 levels, Mr Varquero said. A traditional three-bedroom home that would have cost $ 150,000 18 months ago could be worth $ 180,000 today.

“We are almost back where we were before the pandemic,” said Mauricio Ramirez, a RE / MAX Central agent based in San Salvador, noting that the market “began to see good spikes” in demand in the spring. He said his agency now sees more foreign buyers than it did before the pandemic. Some of them are Salvadoran immigrants returning home, while others have no ties to El Salvador and want to retire there.

Regarding the first group, he said: “El Salvador is largely dependent on the hermanos lejanos — foreign brothers — people outside of El Salvador. People from the USA, Australia, Spain. So they told the news to family members outside the home who said, “Well, we want to buy too.” From the point of view of families, it was a kind of snowball effect. “

According to Latin American classifieds portal Encuentra 24The average price in San Salvador reached $ 113 per square foot in June – up 28 percent from March 2020, when the median hit a low of $ 88 per square foot. Encuentra 24 currently shows about 9000 listings available in San Salvador, the country’s largest market.

Mr Ramirez said prices in El Salvador are lower than neighboring Guatemala and higher than Honduras. For the same price, he estimates, a house in Honduras could be “bigger, better,” while a comparable house in Guatemala could cost about 25 percent more.

In addition to the well-known reasons for the increase in demand caused by the pandemic, namely buyers looking to relocate and find more space, Mr. Varquero said several government initiatives have helped El Salvador’s coastal property market. One of them was the impetus for strengthening the country’s reputation as a global surf center by taking part in the World Surfing Games 2021 of the International Surfing Association, among other surfing competitions. The other was infrastructure investment, security, water and access to electricity.

“This new government is doing great things,” he said. “And this program, the Surf City program, has opened the eyes of many investors around the world to invest in El Salvador.”

However, there is also deep skepticism about the populist motives behind the country’s new president, Nayib Bukele, who accused the media of conspiring against him and used the military to pressure lawmakers, prompting US Vice President Kamala Harris to express “deep concern about democracy in El Salvador.”

For now, prices generally remain below pre-pandemic levels, creating opportunities for buyers, ”said Gary Barquero Arce, president of SCRiesgo, a Central American risk assessment agency. monitors the economy and housing market of El Salvador… This, combined with the expected economic growth and improved infrastructure, makes it a good place to invest, he said.

“I think there is a great opportunity right now to buy houses in El Salvador, especially because prices have dropped due to the pandemic, and also because they are now politically stable. I think this is a good opportunity for investors, especially because El Salvador is a small country, but it is a country with great opportunities. “

Mr. Ramirez said 60 percent of his agency’s buyers were domestic in the past six months, up from 75 percent before the pandemic.

Mr Varquero said that buyers of beachfront properties in El Salvador have been equally divided between local and international buyers over the past two years. About a third of foreigners came from the United States, while the rest came from Germany, France, Holland and other countries.

Buyers from most countries, including the United States, can purchase real estate in El Salvador without restrictions. However, foreigners cannot own more than 605 acres, and only foreigners, whose countries give equal rights to Salvadorans, can acquire real estate, said Oscar Torres, a partner at the law firm Garcia & Bodan, which has offices throughout Central America.

Transactions are processed by notaries who charge a percentage of the purchase price – usually 0.5 to 1 percent.

Other final costs paid by the purchaser typically include property transfer tax (for properties over $ 28,571.43) and registration fees. For properties worth $ 250,000, these taxes are about $ 8,000.

El Salvador works with the US dollar, although Mr Bukele recently advocated legislative efforts to make bitcoin legal tender in the country. “I have a huge list of buyers who are very happy to use Bitcoin as a payment method for real estate transactions,” said Mr. Varquero.

Spanish language; US dollar, bitcoin (1 bitcoin = 32,479 US dollars)

The owner pays $ 115 a month to cover maintenance of the common areas, access to the club’s pool, security, and a prorated annual property tax, Cortez said.

Jose Cortez, El Salvador Coast, 011-503-7945-9464; oceansideelsalvador.com

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