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What will happen in Guatemala City’s real estate market? Will prices go up or down? Is the city still a hotspot for foreign investors? How is Guatemala’s government impacting real estate policies and taxes in 2025?
We’re constantly asked these questions because we’re deeply involved in this market. Through our work with notaries, real estate agents, and clients who buy properties in Guatemala City, we’ve gained firsthand insights.
That’s why we created this article: to provide clear answers, insightful analysis, and a well-rounded perspective on market predictions and forecasts.
Our goal is simple: to ensure you feel informed and confident about the market without needing to look elsewhere. If you think we missed the mark or could do better, we’d love to hear your thoughts. Feel free to message us with your feedback or comments, and we’ll work hard to improve this content for you.
1) More foreign investors will target Guatemala City because of favorable exchange rates
Foreign buyers are increasingly eyeing Guatemala City for investment due to favorable exchange rates.
Guatemala's economy is on a steady rise, creating a stable currency environment that appeals to investors. This stability is backed by reports from the Bank of Guatemala and the World Bank, which suggest that these favorable conditions are here to stay.
Foreign direct investment in Guatemala is booming, with an 8% increase in 2023, totaling $1.55 billion. This surge in investment highlights how attractive the exchange rates are for foreign buyers, especially in the real estate market.
Guatemala City is experiencing a real estate boom, driven by urbanization and a growing demand for housing. This makes the city even more appealing to foreign investors looking to take advantage of favorable economic conditions.
The government is rolling out the "Guatemala Investment Plan 2023-2027," offering incentives like tax breaks and easier permitting processes. These initiatives, along with positive media coverage, underscore Guatemala City's strategic location and economic potential.
With these factors in play, foreign investors are keen to capitalize on the favorable exchange rates and promising investment climate in Guatemala City.
Sources: Trading Economics, Foreign Policy, Latam FDI
2) Property prices in Guatemala City will keep rising because demand is higher than supply
Residential property prices in Guatemala City are on the rise as demand continues to outpace supply.
With a bustling population and high urbanization rates, the city is seeing a surge in housing needs. In 2025, the metro area population hit 3,230,000, marking a 2.22% increase from 2024. This steady growth highlights the ongoing demand for homes.
Foreign investors are also eyeing Guatemala, bringing in USD 1.35 billion in foreign direct investment in 2022. The country's open investment environment, which allows foreigners to own real estate without restrictions, is a big draw. This influx of capital is pushing property values higher as investors look for opportunities.
Land scarcity in Guatemala City is another factor driving prices up. With limited horizontal space due to urbanization, developers are turning to vertical housing solutions. This shift is necessary to meet the growing demand for residential properties.
The expanding middle class is also playing a role. With a GDP per capita growth of 1.9% from 2014 to 2023, more people are able to invest in homes. This economic empowerment is fueling interest in suburban areas and new housing developments.
As the city continues to grow, the combination of population increase, foreign investment, and land scarcity suggests that property prices will keep climbing.
Sources: Macrotrends, Chambers Practice Guides, The Latin Investor
We made this infographic to show you how property prices in Guatemala compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
3) Affordable housing yields will rise as government incentives draw more investors to this segment
In Guatemala City, government incentives are drawing more investors to affordable housing.
With backing from the U.S. International Development Finance Corporation, over $40 million has been invested in affordable housing projects. This financial support reduces risks for investors, making these projects more appealing. The Central American Bank for Economic Integration is also playing a role by funding sustainable housing that focuses on energy efficiency, which not only cuts costs but also attracts environmentally conscious investors.
As more investors jump in, competition and demand for affordable housing are rising, leading to potentially higher returns. The growing population and urbanization in Guatemala City are fueling this demand. Many people are now seeking homes in the suburbs, which offer more space and comfort, further driving the need for affordable housing.
Investors entering the market now are likely to see increased yields due to these trends. The combination of government incentives, financial backing, and shifting consumer preferences is creating a ripe environment for investment. As the city continues to grow, the demand for affordable housing is expected to keep climbing.
For those considering investing in this sector, the current landscape offers promising opportunities. The focus on sustainable and energy-efficient housing adds an extra layer of appeal, especially for those interested in socially responsible investments. With the right timing and strategy, investors can benefit from the ongoing changes in the housing market.
In summary, the affordable housing market in Guatemala City is becoming increasingly attractive to investors, thanks to a mix of government incentives, financial support, and changing consumer needs. This is a prime time to consider entering the market.
Sources: DFC, Habitat for Humanity
4) Demand for properties with lots of storage will grow in Guatemala City as e-commerce expands
The e-commerce market in Guatemala is booming, with projections hitting $381 million by 2024.
In Guatemala City, there's a noticeable demand for modern warehouses. JLL's analysis shows 813,000 sqm of industrial and logistics space, with nearly half being top-tier Class A. This is crucial as 62% of e-commerce transactions are made via mobile devices, highlighting a strong preference for home deliveries.
As last-mile delivery services expand, the need for properties with ample storage space becomes even more pressing. With platforms like WooCommerce and Shopify hosting numerous stores, the demand for efficient logistics solutions is skyrocketing.
Retailers in Guatemala City are increasingly seeking properties that can support their growing operations. The rise of e-commerce is pushing businesses to look for spaces that can handle large volumes of goods efficiently.
For potential property buyers, this trend means that investing in spaces with robust storage capabilities could be a smart move. The city's e-commerce growth is creating a lucrative opportunity for those with the right kind of property.
As the market continues to evolve, properties with ample storage and logistics capabilities are becoming more valuable. This shift is driven by the need to support the increasing volume of online transactions.
Sources: Registro GT, Crowley Guatemala, Aftership, JLL
5) Suburban rental yields will increase as families look for bigger homes outside city centers
Families are increasingly seeking larger homes in suburban areas due to the rise of remote work.
In places like San Lucas Sacatepéquez, there's a noticeable trend of new real estate developments that cater to modern lifestyles. These areas are becoming popular as they offer more space and are often more affordable than city centers. The suburban lifestyle is appealing, especially with the added benefit of improved infrastructure and transportation, making commuting easier.
Suburban properties are generally more affordable, which is a big draw for the growing middle class. Many families find that these areas provide a better balance of space, cost, and quality of life. This is particularly true in areas where rental prices in city centers have skyrocketed, pushing families to look for alternatives.
In places like Zona 4 in Guatemala City, the increase in property values and rental demand has made city living less feasible for many families. This has led to a shift towards suburban areas, where they can enjoy more space and better living conditions at a lower cost. The trend is clear: suburban living is becoming more attractive as families seek larger spaces outside the bustling city.
Rental yields in suburban areas are expected to rise as more families move away from city centers. This migration is driven by the desire for larger living spaces and the comparative affordability of suburban homes. As more families make this shift, suburban rental markets are likely to see significant growth.
With these changes, suburban areas are not just becoming a refuge from the high costs of city living but are also evolving into vibrant communities that offer a high quality of life. The demand for suburban homes is set to continue growing, making it a promising area for real estate investment.
Sources: Duke University, CARNM Realtor
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6) Luxury property yields will drop slightly as purchase prices rise faster than rental income
Guatemala City's luxury property market is on the rise, with purchase prices climbing steadily.
By 2025, these prices are expected to increase by 3% to 7%, outpacing rental income growth. This means buying a luxury property is becoming more expensive, while the income from renting them isn't catching up.
Currently, rental yields in Guatemala City hover around 2.9% for new residential properties. This low return indicates that rental income is lagging behind the rapid rise in property prices, widening the gap between buying costs and rental earnings.
The demand for luxury homes is also being fueled by foreign investments from companies like Microsoft and Lala. This influx is pushing more wealthy individuals to buy rather than rent, as they prefer the control and flexibility of ownership.
Surveys show that affluent buyers are leaning towards owning homes, driven by the desire for greater control over their living spaces. This trend is reshaping the market dynamics, making ownership more appealing than renting.
Source: Zillow
7) Guatemala City’s home prices will rise slightly due to economic growth
Guatemala City is seeing a slight rise in residential real estate prices due to economic growth.
With the economy on the upswing, GDP per capita has grown by 1.9% from 2014 to 2023, which means people are spending more and looking for homes. This economic boost is a key driver behind the increasing demand for housing.
Foreign investment is also playing a big part. The government is targeting USD 1.65 billion in foreign direct investment for 2024 and even more for 2025. This influx of money is expected to push property prices up as more investors jump into the market.
The middle class is expanding, and with more purchasing power, they're looking to buy homes. The poverty rate is expected to drop from 55% in 2023 to 54.3% in 2024, which means more people can afford to invest in real estate.
Government efforts to improve infrastructure are also making a difference. By cutting logistical costs and boosting competitiveness, these initiatives are attracting investors, which in turn drives up property prices.
Low-interest rates, expected to stabilize at around 6% in 2025, make it easier for buyers to get financing, encouraging more property investments.
Sources: Latam FDI, Atlantic Council
8) Rental yields in Guatemala City will rise as more young professionals seek rental properties
Rental yields in Guatemala City are on the rise as young professionals flock to the urban landscape.
Since 2023, there's been a noticeable shift with more young people moving from rural areas to the city. This migration trend is largely driven by younger demographics seeking urban opportunities, as highlighted by the World Bank. The average age of these migrants is dropping, indicating a fresh wave of youthful energy entering the city.
Guatemala's youthful population is a key factor here. Back in 2011, over half of the population was under 19. Fast forward to today, and many of these young individuals are stepping into the workforce, eager to find housing in bustling urban centers like Guatemala City. This surge in demand for rental properties is a direct result of this demographic shift.
Economic growth is another piece of the puzzle. With a projected GDP growth rate of 3.7% in 2025, Guatemala is becoming a magnet for multinational companies. These companies are setting up shop in Guatemala City, creating job opportunities that appeal to young professionals. Naturally, this boosts the demand for rental housing as these professionals seek convenient living arrangements.
Home ownership is becoming less attractive due to rising costs. Maintenance expenses are expected to be around 1.5% of a property's value annually, making renting a more viable option. Limited affordable housing for purchase further nudges young people towards renting, which in turn pushes rental yields higher.
Sources: World Bank, Wikipedia
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Guatemala. 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.
9) Tech-savvy buyers will be drawn to virtual reality tours for property viewings in Guatemala City
In Guatemala City, virtual reality tours are becoming a go-to for property viewings, especially for tech enthusiasts.
With 19.06 million smartphones connected to the internet, Guatemala's digital landscape is ripe for VR technology. This connectivity allows potential buyers to explore homes without leaving their couches, making the process both convenient and accessible.
The pandemic pushed many to seek safer ways to view properties, and VR tours quickly became a preferred method. Even now, many people continue to favor these tech-driven solutions, finding them both efficient and engaging.
By 2023, over half of adults had experienced a virtual tour, and a significant 67% of home buyers expressed interest in using them when browsing listings. This shows a clear shift towards digital solutions in the real estate market.
Globally, the VR real estate market is on the rise, with projections suggesting it could hit $2.6 billion by 2025. This growth highlights the increasing acceptance and integration of VR technology in property viewings worldwide.
In Guatemala City, the combination of high internet penetration and the growing popularity of VR tours is transforming how properties are viewed, attracting a new wave of tech-savvy buyers.
Sources: Medialandscapes.org, IDB Publications, EZ Real Estate Tools
10) Demand for properties in previously overlooked areas will grow due to city center infrastructure improvements
Infrastructure upgrades in Guatemala City are set to make previously overlooked areas more appealing for property buyers.
Thanks to a massive government investment, the city is seeing projects like the extension of electric energy coverage, new rural roads, and an urban subway line. This is all part of a three-billion-dollar plan funded for 2024 and 2025.
The Metro Riel project is a game-changer, expected to boost property values near transit hubs. We've seen this happen in places like Bogotá and Mexico City, where public transport improvements have made nearby properties more valuable. Better public transport means more convenience and accessibility, making these areas a hit with buyers.
Guatemala's public transportation market is on the rise, driven by a need for convenient and cost-effective travel. This trend is likely to increase interest in properties near new infrastructure. Suburban areas around Guatemala City are becoming real estate hot spots, thanks to the demand for space and affordability.
Sources: Mayora & Mayora, LatinFinance, Statista
11) Luxury rental prices will drop slightly as more high-end properties become available
In 2023 and 2024, luxury property construction surged in Guatemala City.
With this boom, the market is seeing more high-end rentals than ever before. When supply outpaces demand, prices naturally start to dip. This is great news if you're looking to rent a luxury home.
Real estate agencies are buzzing about the growing inventory of luxury homes. More properties mean landlords are vying for your attention, often by lowering prices to make their offers more attractive.
Interestingly, many people now prefer to buy rather than rent luxury properties. This shift in preference is reducing the demand for luxury rentals, nudging prices down even further.
So, if you're considering a move, this could be the perfect time to explore the luxury rental market. With more options and competitive pricing, you might find a deal that suits your taste and budget.
Keep an eye on the market trends, as more high-end properties continue to enter the scene, potentially leading to even more favorable rental conditions.
Sources: Real Estate, Airbnb
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12) Rents in Guatemala City will rise as urbanization attracts more residents
Guatemala City is experiencing a steady population growth, with more people moving in every year.
By 2025, 67.3% of Guatemala's population is expected to live in urban areas, driven by the search for better jobs and living conditions. This trend is making cities like Guatemala City more attractive and increasing the demand for housing.
As the city becomes more crowded, high-density housing projects are popping up to accommodate the influx. These modern developments, often equipped with amenities, are in high demand, pushing property prices upward.
In fact, property prices in Guatemala City are projected to rise by 3% to 7% in 2025, reflecting the growing interest in urban living. This makes it a potentially lucrative market for property buyers.
With limited land available, the city is focusing on vertical growth, which means more apartment buildings and fewer single-family homes. This shift is a response to the increasing urbanization and the need to house more people efficiently.
As urbanization continues, the demand for housing in Guatemala City is expected to keep rising, making it a hot spot for real estate investment.
Sources: Trading Economics, Macrotrends
13) Affordable housing prices will stay steady as government efforts boost supply
The Guatemalan government is making strides in supporting affordable housing.
They've teamed up with the Central American Bank for Economic Integration to fund projects that focus on sustainable and energy-efficient housing. This approach not only cuts down on long-term costs but also benefits the environment.
One impressive initiative is the Self-Managed Cooperative Housing Program, which has already provided homes for 225 families living below the poverty line. This program is a great example of how government, private developers, and other sectors can work together to make affordable housing a reality.
To address the housing shortage, especially in urban areas like Guatemala City, the government has set aside 750 million quetzales for affordable housing. This budget includes low-interest loans for first-time buyers, with terms extending up to 40 years, making it easier for people to own homes.
These efforts are part of a broader strategy to ensure that affordable housing prices remain stable as the government works to increase supply.
By focusing on these initiatives, the government is not only tackling the housing shortage but also ensuring that more people can afford to buy homes in the country.
Sources: Global Urban Development, CTBUH
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.