Authored by the expert who managed and guided the team behind the Colombia Property Pack
Everything you need to know before buying real estate is included in our Colombia Property Pack
Curious about the future of Colombia's real estate market? You're not alone. With our extensive experience working alongside notaries, real estate agents, and property buyers, we've gathered valuable insights into the trends shaping this dynamic market. In this article, we dive into the strongest forecasts for Colombia's real estate landscape, exploring whether prices are set to rise or fall, and if Medellín remains a prime destination for foreign investors. We'll also examine how government policies and taxes might influence the market in 2025. Our aim is to equip you with the knowledge you need to navigate the market confidently. If you have any feedback or suggestions, please reach out to us. We're committed to enhancing this content for you.
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1) Property prices in Medellín’s eastern suburbs will rise quickly due to new metro and tunnel projects improving connectivity
Medellín's eastern suburbs are becoming a hot spot for property buyers.
In recent years, these areas have seen a surge in property demand thanks to improved security and infrastructure. Medellín is gaining a reputation as a vibrant tourist and business hub, making its suburbs more appealing. The new metro and tunnel projects are set to enhance connectivity, drawing even more interest from potential buyers.
Historically, property prices in Medellín's high-demand areas have risen by 10-15% annually. This trend is expected to continue in the eastern suburbs, especially with the completion of these new infrastructure projects. Similar developments in other regions have led to significant property price hikes, so it's reasonable to expect the same here.
The Colombian government is investing heavily in Medellín's metro system, including the Tranvía de la Avenida 80 project. This, along with the Toyo Tunnel, which will be the longest road tunnel in Latin America, is set to boost connectivity in the eastern suburbs. Such improvements are likely to drive up property demand and prices even further.
These infrastructure projects are not just about convenience; they are game-changers for the local real estate market. As connectivity improves, the eastern suburbs are poised to become some of the most sought-after areas in Medellín. Buyers looking for investment opportunities should keep a close eye on these developments.
With the metro and tunnel projects underway, the eastern suburbs are on the brink of transformation. The combination of improved infrastructure and Medellín's growing appeal as a destination makes these areas a prime target for property investment.
Sources: Medellín Real Estate, World Highways, BNamericas
2) Investors will be drawn to Bogotá’s La Candelaria as restoration projects create boutique residences
La Candelaria in Bogotá is quickly becoming a prime spot for property investors.
In Bogotá, property values in historic districts are on the rise, and La Candelaria is no exception. Areas like Chapinero and Santa Fe have already seen this trend, making La Candelaria a logical next step for investors. The district's charm and potential for growth are hard to ignore, especially as more people look to invest in places with character and history.
The Colombian government is sweetening the deal with increased incentives for restoration projects in historic areas. This means that investors can not only preserve cultural heritage but also enjoy financial benefits. La Candelaria is a perfect example, with successful restorations already proving profitable. These projects show that investing here isn't just about nostalgia; it's a smart financial move.
Tourism in Bogotá is booming, with a record number of international visitors in 2023. This surge in tourists is particularly drawn to cultural hotspots like La Candelaria. The district's colorful colonial buildings and lively cultural events are a magnet for visitors, which in turn boosts the demand for boutique residences. Investors can capitalize on this trend by transforming older buildings into unique living spaces.
La Candelaria's vibrant cultural scene is a major draw. The area is bustling with activity, from street performers to art galleries, making it a lively place to live and visit. This increased foot traffic not only enhances the neighborhood's appeal but also drives business activity, creating a thriving environment for new investments.
For those looking to invest in Bogotá, La Candelaria offers a unique opportunity. The combination of government incentives, rising property values, and a booming tourism industry makes it an attractive option. Investors can expect both cultural and financial returns as they contribute to the district's ongoing transformation.
Sources: YouTube, Colombia Travel, Nomadic Niko, Visit Latin America
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Colombia. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
3) Rental yields in Medellín's mid-range apartments will rise 20% as more digital nomads move in
Medellín is quickly becoming a favorite spot for digital nomads, with 8,300 newcomers arriving each month thanks to a handy two-year digital nomad visa.
This influx is pushing up demand for mid-range apartments as these remote workers look for comfy yet affordable places to live. Rental yields in Medellín have ticked up to about 6.5%, driven by rising property values and the strong interest from expatriates and digital nomads.
In popular neighborhoods like El Poblado, rental prices have jumped by 81%, making mid-range apartments even more attractive to this crowd. The global shift towards remote work is only adding fuel to the fire, boosting the need for housing in hotspots like Medellín.
What makes Medellín so appealing to digital nomads? For starters, the city boasts excellent internet connectivity and a growing number of coworking spaces, ensuring reliable work environments. Plus, living in Medellín is about 70% cheaper than in New York City, offering a high quality of life without the hefty price tag.
The city's vibrant culture, stunning natural beauty, and improved safety and quality of life are also big draws. Medellín's charm is undeniable, making it a top choice for those looking to balance work and leisure.
As more digital nomads flock to Medellín, rental yields in mid-range apartments are expected to rise by 20%, offering a promising opportunity for property investors.
Sources: Marketplace, UNH Scholars, International Living
4) European investors will target eco-friendly projects in smaller cities like Pereira for lower prices and strong growth potential
European investors are increasingly drawn to sustainable and eco-friendly investments, a trend that has been growing since 2023.
In smaller cities like Pereira, property prices are significantly lower than in major cities such as Bogotá. For instance, rent prices in Pereira are 44.2% lower, making it an attractive option for investors seeking cost-effective opportunities with strong growth potential.
Pereira is buzzing with economic growth, fueled by real estate investments and nearshoring. This development is pulling in more investors, as the city offers a promising environment for economic activities.
The Colombian government is sweetening the deal with incentives for eco-friendly projects, which further lures European investors. These incentives include support for green projects and policies aimed at preserving biodiversity.
Smaller cities like Pereira are seeing a rise in tourism, thanks to their natural beauty and eco-tourism potential. This trend is expected to continue, making these cities even more appealing for sustainable investments.
Latin America, including Colombia, has become a significant destination for European investments. This broader interest in the region highlights the potential for eco-friendly projects in cities like Pereira.
Sources: ESG News, Numbeo, Funds Society
5) Demand for solar-powered homes in rural and coastal areas will grow as buyers seek lower energy costs
In Colombia, solar-powered homes are gaining popularity in rural and coastal areas.
With electricity rates rising by 30% over the past five years, many homeowners are turning to solar energy to cut down on long-term costs. This shift is especially noticeable in areas where traditional energy sources are becoming more expensive.
The Colombian government is also playing a big role in this trend. They've set ambitious goals to add 6 GW of renewable energy capacity by 2026 and are offering tax incentives to attract foreign investors. This makes it easier for homeowners to access solar technology and contributes to Colombia becoming a regional hub for renewables.
Another reason for the shift is that solar panel installation and maintenance costs have dropped significantly. For smaller systems, maintenance is about 2% of the initial cost annually, and for larger systems, it's around 1%. This is because solar panels have no moving parts and use free sunlight as fuel.
In rural and coastal regions, where the sun is abundant, solar energy is a cost-effective solution for long-term energy needs. Homeowners in these areas are increasingly seeing the benefits of investing in solar technology.
As more people adopt solar power, the trend is expected to continue, making solar-powered homes a smart choice for those looking to save on energy costs in the long run.
Sources: Energy News Pro, TXSES, It's My Sun
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6) 3D-printed homes will become popular in low-income areas, providing affordable and sustainable housing options
The demand for affordable housing in Colombia is rising, with 3.7 million households facing a deficit in 2023.
3D-printed homes are stepping up as a game-changer, especially in lower-income areas. In Latin America, this tech has already shown promise with Guatemala's first 3D-printed house completed in 2023, proving it works even in earthquake-prone zones.
One big perk of 3D-printed homes is the potential to slash building costs by up to 45%. This is a huge win for low-income markets where every penny counts.
The Colombian government is on board with these innovative solutions. The UNDP is using 3D printing to build homes, aligning with the National Development Plan 2023-2026 to boost housing access for those who need it most.
Local and international partnerships are key. The collaboration between Progreso and COBOD International in Guatemala shows growing interest in 3D-printed housing from all sides.
3D printing also scores points for being eco-friendly. It cuts down on construction waste and uses sustainable materials, fitting right in with the global push for greener housing.
Sources: 3Dnatives, COBOD International, IMechE
7) Buyers will be drawn to eco-smart homes in flood-prone areas of Cali due to climate resilience projects
Cali is making big moves in climate resilience by investing in nature-based solutions to combat flooding and other climate change effects.
In Colombia, there's a growing trend towards eco-friendly and sustainable housing as people become more aware of the need for homes that can handle environmental challenges. The government's push for a green transition is making these eco-smart homes even more attractive to buyers.
Buyers are also drawn to government incentives for building eco-smart homes, especially in flood-prone areas. These incentives are part of a larger strategy to promote sustainable development and climate resilience, offering financial benefits while supporting environmental sustainability.
Take Barranquilla, for example, where climate resilience projects have successfully reduced flood damage. By restoring waterways and creating green spaces, the city has improved living conditions and protected against natural disasters, setting a precedent for other cities.
These efforts in cities like Cali and Barranquilla show that investing in eco-smart homes is not just a trend, but a smart move for those looking to buy property in flood-prone areas. The combination of government support and proven success stories makes these homes a compelling choice.
With Cali's focus on enhancing biodiversity and projects like the Pact for Wildlife, the city is reducing the impact of extreme weather events, making it an attractive option for potential buyers interested in sustainable living.
Sources: UNEP, USAID, Foreign Policy
8) Property demand will grow in Medellín's hillside neighborhoods due to new cable car projects
Medellín's cable car projects are transforming the city's hillside neighborhoods.
These areas, once overlooked, are now seeing a boost in property values. According to a study by Garcia-Lopez and Gomez-Hernandez, improved public transportation like the Tranvía system positively impacts housing prices. This means the cable cars could make properties in these neighborhoods more valuable, attracting potential buyers.
The cable car lines are also helping to change perceptions of the comunas. An Oxfam article highlights that income growth and reduced stigmatization are making these areas more appealing. People are increasingly interested in living near cable car stations, seeing them as desirable places to settle down.
Looking at other cities, we see similar success stories. In places like Hong Kong and Vancouver, integrating transit infrastructure with urban design has created vibrant communities. These examples show that improved public transportation can boost local economies and increase property demand.
Medellín's cable cars are not just about getting from point A to B; they're about revitalizing neighborhoods. The World Bank notes that cable cars are an economically viable public transport system, which can lead to thriving communities.
As these projects continue, expect more interest in Medellín's hillside properties. The combination of better transport and community development is a win-win, making these areas prime spots for investment.
Sources: Garcia-Lopez and Gomez-Hernandez (2024), Oxfam (2021), World Bank (2021)
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Colombia versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
9) Foreign interest in Cartagena’s beachfront properties will drive double-digit annual price growth in Bocagrande
Cartagena's beachfront properties, especially in Bocagrande, are catching the eye of foreign investors.
With 640,331 international visitors in 2023, Cartagena is now the third most popular spot in Colombia, right after Medellín and Cali. This surge in tourism is expected to continue, with a 24% increase in international tourists predicted for the first half of 2024, making Cartagena a hot destination.
Foreign investment in Colombian real estate is on the rise, and Cartagena is no exception. In 2023, the tourism sector saw a record 5,869,869 non-resident tourists, showing a strong post-pandemic recovery. The infrastructure development in Bocagrande, like expanding beaches and improving water drainage, is set to boost property values.
The coastal expansion project in Bocagrande is not just about aesthetics; it's about practicality too. By improving water drainage and preventing street flooding, these enhancements make beachfront properties even more appealing. Plus, more direct flights from major international cities are making Cartagena more accessible, further driving interest in real estate.
The growing expatriate community in Cartagena is another factor. Attracted by its vibrant culture and status as a digital nomad hub, this community is fueling demand for luxury residential projects and vacation rentals. This trend is particularly strong in areas like Bocagrande, where the lifestyle and amenities are a big draw.
Sources: Medellin Advisors, Double Double Cartagena, Travel Pulse
10) Laureles in Medellín will stay popular for living due to its mid-range prices and high quality of life
Laureles in Medellín is a favorite spot for those seeking a mix of traditional charm and modern amenities.
In recent years, from 2023 to 2024, both locals and expats have flocked to this neighborhood, drawn by its inviting residential vibe and the convenience of nearby parks, schools, and shopping centers. It's a place where you can enjoy a quieter atmosphere without sacrificing access to everything you need.
Real estate agents often point out that Laureles boasts high livability ratings, making it a top choice for many. The neighborhood's appeal lies in its balance of tranquility and accessibility, with everything within walking distance.
Safety is a big draw here. While specific crime stats aren't mentioned, Laureles is generally seen as a safe haven, which is a major plus for families and individuals seeking a secure place to call home. The neighborhood's reputation for safety is well-known among residents.
Getting around is a breeze, thanks to the strong public transportation links, especially the Medellín Metro system. This makes commuting and exploring the city hassle-free, adding to the neighborhood's attractiveness.
Laureles continues to be a top residential choice, offering mid-range prices and high livability, making it a smart investment for potential buyers.
Sources: Medellín Guru, Visit Medellín Today
11) Luxury home prices in Bogotá and Medellín will grow more slowly as wealthy buyers invest in rural estates or second homes
In Colombia, luxury home prices in Bogotá and Medellín are seeing slower growth as affluent buyers turn their attention to rural estates and second homes.
Many wealthy Colombians are now drawn to the idea of rural living, seeking a lifestyle that blends work, leisure, and nature. The pandemic has made these less crowded areas even more appealing, leading to a significant rise in demand for rural second homes.
Developments like Cannúa are catching the eye of those interested in sustainable and eco-friendly living. These properties offer a mix of high-end amenities and sustainable practices, appealing to buyers who value both luxury and environmental responsibility.
While property prices in Colombia are generally on the rise, luxury urban markets in Bogotá and Medellín are experiencing slower growth. This shift is largely due to buyers seeing more lifestyle benefits and potential returns in rural investments.
Sources: Statista, World Bank, J.MAK Hospitality
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12) US and Canadian buyers will drive Cartagena property prices up by 15% over the next five years
Cartagena is becoming a hotspot for US and Canadian property buyers.
With over 3.5 million air passengers arriving in 2022, many from North America, Cartagena is seeing a surge in interest from US and Canadian tourists. This influx is not just about vacations; it's sparking curiosity about owning property in this lively city. The vibrant culture and stunning coastal views are drawing in potential buyers who want a slice of Cartagena's charm.
Historically, foreign investment has played a big role in Cartagena's real estate market. Back in the early 2000s, the city's historic center saw a property price jump of 300% to 600% between 2004 and 2009. This shows how foreign interest can really boost property values. Plus, with the current exchange rates, US and Canadian buyers find Colombian real estate even more appealing, giving them more bang for their buck.
The growing communities of US and Canadian expats in Cartagena are a testament to the city's allure. Many of these expats are snapping up local properties, seeing them as solid investments. The Colombian government is also rolling out the welcome mat with incentives for foreign property investment, making it easier and more attractive for international buyers to dive into the market.
Foreign buyers from the US and Canada are expected to dominate the market in Cartagena, driving up prices by at least 15% in the next five years. This trend is fueled by the city's irresistible mix of history, culture, and modern amenities, making it a prime spot for investment. The combination of favorable exchange rates and government incentives is creating a perfect storm for North American buyers looking to invest in Cartagena's real estate.
Sources: Medellin Advisors, Global Property Guide
13) Demand for affordable family homes near Colombia’s regional capitals will grow as the middle class expands
Colombia's middle class is growing steadily due to economic stability and foreign investment.
With more people joining the middle class, there's a rising demand for quality housing in both urban and suburban areas. This trend is particularly evident in cities like Bogotá and Medellín, where people are flocking for better job opportunities and living conditions.
Urbanization is picking up speed, with the urban population expected to increase significantly by 2035. This shift is largely driven by internal migration, as people move to larger cities in search of a better life.
The demand for homes in urban areas is outpacing supply, pushing property prices higher in major cities. Bogotá, Medellín, and Cali are seeing more buyers than sellers, creating a competitive housing market.
As Colombia's middle class expands, the need for affordable family homes near regional capitals is becoming more pressing. This growth is a key factor in the increased demand for residential real estate in these rapidly urbanizing areas.
For potential buyers, understanding these trends can offer valuable insights into the Colombian property market. The surge in urbanization and middle-class growth are shaping the future of housing demand in the country.
Sources: BBVA Research, Urbanet, OECD iLibrary
14) Younger, tech-savvy investors will enter the property market due to virtual tours and digital buying platforms
Colombia's digital landscape is rapidly evolving, making it a hotspot for tech-savvy property investors.
With mobile internet access on the rise, expected to jump from 54.27% in 2024 to 59.86% in 2025, the country is becoming increasingly connected. This connectivity is crucial for attracting younger investors who prefer digital solutions. Real estate companies are catching on, using virtual tours to showcase properties in a way that resonates with this audience.
Platforms like Floorfy are leading the charge, offering 30,000 virtualized properties and drawing in over 2 million visits each month. This shows how effective virtual tours can be in engaging potential buyers who are more comfortable navigating the digital world. The convenience of exploring properties online is a game-changer, especially for those who value efficiency.
Consumer surveys back this up, revealing a strong preference for digital transactions in real estate. The ease and speed of digital buying platforms are major attractions. For instance, real estate agents using Floorfy have seen a dramatic drop in the number of physical visits needed to close a sale, from 17 to just 6, thanks to these virtual tours.
These digital tools are not just a trend; they're reshaping how properties are marketed and sold. The ability to view a property from anywhere in the world is particularly appealing to younger investors who are used to doing everything online. This shift is making the property market more accessible and appealing to a new generation of buyers.
As Colombia continues to enhance its digital infrastructure, the real estate market is poised to benefit from this tech-driven transformation. The integration of virtual tours and digital platforms is not just about convenience; it's about meeting the expectations of a digitally native audience. This trend is set to redefine property investment in the country.
We have made this infographic to give you a quick and clear snapshot of the property market in Colombia. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
15) Property taxes will rise in wealthier areas of Bogotá and Medellín to support infrastructure projects
Property values in Bogotá and Medellín's upscale areas are climbing, making them hotspots for potential buyers.
Neighborhoods like El Poblado in Medellín and Chapinero in Bogotá are seeing a surge in property prices, thanks to their luxury appeal and international interest. This trend is turning these areas into affluent hubs, which often leads to higher property taxes.
The Colombian government is keen on raising funds for infrastructure projects. In 2023 and 2024, they rolled out a tax reform plan to boost revenue through increased property taxes. This is part of a larger effort to enhance urban infrastructure, like transportation and public services, which are essential for the growing city populations.
Colombia has a history of adjusting property taxes to support urban development. The government tries to balance revenue needs with protecting property owners, but the demand for better infrastructure is pressing. As more affluent residents move into these neighborhoods, the case for higher property taxes strengthens, similar to trends in other Latin American cities.
For those considering buying property in these areas, it's important to be aware of these potential tax increases. The government's focus on infrastructure means that property taxes in wealthier neighborhoods are likely to rise to fund these projects.
Understanding these dynamics can help potential buyers make informed decisions. The ongoing development and international interest in Bogotá and Medellín suggest that property investments here could be promising, despite the tax hikes.
Sources: Colombia One, Medellin Advisors
16) More Colombians will choose renting over buying in big cities as mortgage rates rise
Many Colombians are now choosing to rent rather than buy homes in major cities.
This shift is mainly because mortgage interest rates have been rising, making home purchases more expensive. Even though the Central Bank of Colombia cut its benchmark rate to 10.25% in 2024, it's still high, and experts predict rates will stay elevated, keeping mortgage costs up.
In cities like Bogotá and Cali, property prices dipped in 2023 but are expected to rise again by 2025. This potential increase, along with high interest rates, could make owning a home less affordable, pushing more people towards renting, which offers flexibility without the heavy financial load of a mortgage.
Surveys show that more Colombians are leaning towards renting because it's seen as more affordable and flexible. The rental market is growing, with many opting for leases over buying. This trend is bolstered by the rise of co-living spaces and tech innovations in the rental process, making renting more convenient and appealing.
In Bogotá, for instance, the demand for rental properties has surged, with many young professionals and families finding it a more viable option. The city's vibrant neighborhoods and cultural attractions make renting an attractive choice for those who value lifestyle and flexibility.
Meanwhile, in Cali, the rental market is also expanding, driven by a mix of students and professionals who prefer the ease and adaptability of renting. The city's dynamic atmosphere and lower cost of living compared to Bogotá add to its appeal for renters.
Sources: The Rio Times, Global Property Guide, Statista, Trading Economics
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility.