Buying a new property or a second property? Main differences

When it comes to buying real estate in Panama, deciding on a second or new construction property is something that for many is an important factor, and for others it may not give much relevance.

For both cases, there are their pros and cons, especially in Panama City, where there is a wide variety of options for both second hand and new apartments and houses that adapt to the tastes and needs of each buyer.

You would think that the ideal is to buy a new property since everything is newly built, but in today’s market, surprisingly there are also risks when buying new units.

Here are some important differences between new and second-hand properties in Panama:

The best location

The location is obviously a determining factor for any buyer when looking for his ideal property. Who would not like to buy a new apartment in a perfect and developed location?

In Panama City, when deciding to buy in the best locations or, in the most developed areas with enough amenities and shops nearby, there will always be more options in secondhand buildings and houses.

The real estate market in Panama City as of this year has matured a lot in the most sought-after areas, therefore it is not very common for new projects to emerge in the best locations, and when one comes out there is another barrier, that we will mention below.

The price

The development of new projects, especially in the most sought-after areas of Panama, come with prices per square meter much higher than the options that can be found second-hand.

Currently, in San Francisco area, for example, second-hand apartments can be found in the ranges of $1,700 to $2,000 per m2, while new projects are seen with prices of $2,400 and up.

Another important factor, speaking of square meters, is that new projects generally come with units with smaller spaces. It is now common to see new apartments from 60 to 110 m2 distributed with 2 to 3 bedrooms, when a few years ago projects from 100 to 140 m2 (or more) were offered for the same number of rooms.

Construction quality

You would think that when buying an apartment in a new project in Panama you would always have top quality construction, and this is not always the case. Due to the high real estate competition in Panama in recent years, there are some cases of recently delivered units with construction quality problems.

This situation did not occur in the market a few years ago, and for this reason many second-hand buildings are built with higher quality standards.

This does not mean that all new constructions are of poor quality, just that to decide on a new property vs. a second-hand one, it is advisable to research a little deeper, for example about the real estate developer and his track record, if possible, visiting previous apartments built from the same company in order to understand the finish and the quality of the construction.

Payment terms

Payment terms can be a barrier when deciding on the purchase of a second property instead of a new property. In the current market, real estate agencies that develop new constructions offer very flexible payment methods for the buyer at the time of making the initial payment.

It is also worth mentioning that the financing offered by banks for new properties is greater than that granted for second-hand units. In the case of new properties, it can be possible to acquire an apartment with a 5% or 10% down payment, which is not usual for second-hand apartments and houses.

As always, buying real estate is not a decision that is taken lightly, for many families it is the largest purchase that occurs during their lives and therefore, many factors influence the decision to buy either a new property or an existing one.

The important thing is to do your research and get as much information as possible before making a purchase decision.