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Everything you need to know before buying real estate is included in our Guatemala Property Pack
What will happen in Guatemala’s real estate market? Will prices go up or down? Is Guatemala 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, 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.
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1) Investor interest in Guatemala City rentals will drop due to stricter rent controls
Stricter rent control measures are making rental properties less attractive to investors in Guatemala City.
When these controls are in place, landlords face limits on how much they can raise rents, which directly impacts potential profits. Investors are always on the lookout for opportunities to maximize returns, and these restrictions can be a deal-breaker. In places like the United States, where rent control is common, 87.5% of multifamily developers avoid building in such areas, highlighting a clear deterrent for investment.
Guatemala's rental market is already challenging, with rental yields hovering around 2.9% for new residential properties. This figure is not particularly enticing for investors seeking higher returns. Adding rent control into the equation can make the situation even less appealing, as capped rent increases might not keep up with inflation, potentially leading to negative cash flow for landlords.
In other markets, similar trends have been observed, where strict rent control measures have led to a decrease in property investment. Investors often shy away from these areas, preferring locations where they can freely adjust rents to match market conditions. This pattern is not just limited to the U.S.; it’s a global phenomenon.
For those considering investing in Guatemala City, it's crucial to understand how these rent control measures could impact your bottom line. The potential for reduced profits and the risk of negative cash flow are significant factors to weigh. Investors might find themselves in a tough spot if they can't adjust rents to cover rising costs.
Sources: Multifamily Dive
2) Demand for gated communities in Guatemala will grow as buyers seek better security and lifestyle amenities
Guatemalan buyers are increasingly drawn to gated communities for enhanced security.
In 2023, Guatemala's homicide rate was 16.7 per 100,000 people, highlighting ongoing safety concerns. This has led to a surge in demand for private security services, making gated communities more appealing. These communities not only promise better security but also offer lifestyle perks that urban residents find attractive.
Gated communities are becoming a popular choice because they provide a sense of safety and a prestigious living environment. The National Civil Police reported numerous criminal acts in late 2023, reinforcing the need for secure living spaces. As a result, more people are willing to invest in these areas for peace of mind and comfort.
Real estate trends show a noticeable increase in sales within gated communities, indicating that buyers value the perceived safety and lifestyle benefits. The media and social media often highlight these advantages, further swaying consumer preferences towards these secure enclaves.
In Guatemala City, the development of gated communities is a response to the growing fear of crime. These communities offer not just security but also amenities that enhance the quality of life, making them a desirable option for many.
As crime remains a concern, the trend towards gated communities is expected to continue, with more buyers seeking the comfort and prestige they offer. This shift is evident in the real estate market, where gated communities are increasingly seen as a safe investment.
Sources: The Development of Gated Communities in Guatemala City, Violence in Guatemala still marks high averages - Prensa Latina, GUATEMALA - Analysis of the State of homicidal violence - Infosegura
We have made this infographic to give you a quick and clear snapshot of the property market in Guatemala. 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.
3) Coastal property prices will be unstable due to rising sea levels and storm risks
Coastal properties are experiencing price volatility due to concerns over rising sea levels and storm risks.
In recent years, particularly in 2023 and 2024, the Caribbean Sea's sea levels have been rising faster than the global average, at about 3.6 mm per year. This trend is expected to continue, potentially impacting land areas and communities significantly by 2050.
Storms are becoming more frequent and intense. For instance, in November 2024, there were more named storms than usual, including Hurricane Rafael, which caused significant damage. Historical events like Hurricane Otto have also shown how vulnerable coastal properties can be.
Real estate market analyses reveal that property values in coastal areas have fluctuated due to these climate-related risks. This fluctuation is a direct result of the increased frequency and intensity of storms.
Consumer surveys highlight that potential property investors are concerned about these risks, which can lead to decreased demand and price volatility. This concern is particularly evident in areas prone to storm damage.
As a result, the real estate market in coastal regions is facing uncertainty and instability, making it crucial for potential buyers to consider these factors when investing.
Sources: Latinoamerica21, NCEI, USAID
4) Demand for solar-powered homes will grow as energy costs increase and environmental awareness rises
Solar-powered homes are becoming increasingly popular as energy prices rise and environmental awareness grows.
In Guatemala, there's been a remarkable shift towards solar energy, with solar power now making up 17.03% of the country's electricity in 2023, a huge jump from just 1.83% in 2022. This trend highlights how solar energy is becoming a go-to alternative to traditional power sources.
The cost of solar technology has been dropping, making it a more affordable choice compared to conventional energy. This is especially important in Guatemala, where electricity prices have been unpredictable. As people seek more stable and cost-effective energy solutions, solar power stands out as an appealing option.
Government incentives are also a big factor in the rise of solar energy. Guatemala has rolled out policies like renewable energy targets, net metering, and tax breaks, which encourage investment in solar installations. These incentives help ease the financial load, making solar energy more accessible to many.
Media coverage on environmental issues and the perks of renewable energy has boosted public interest in sustainable solutions. Guatemala's commitment to international agreements like the Paris Agreement shows its dedication to cutting carbon emissions and promoting clean energy. This growing environmental awareness is driving the shift towards solar-powered homes.
As more people become conscious of their environmental impact, the demand for solar-powered homes is likely to keep rising. The combination of economic benefits, government support, and environmental consciousness makes solar energy an attractive choice for homeowners.
Sources: Global Climatescope, GlobeNewswire, Energy Charter
5) More European investors will enter Guatemala’s residential market, especially in historic and culturally rich areas
European investors are set to make a bigger splash in Guatemala's residential market, especially in its historic and culturally rich areas.
Guatemala's real estate market is on the rise, with a projected growth of 6.02% from 2024 to 2029. This boom is largely fueled by foreign investments, including those from Europe. The uptick in European tourism to Guatemala is a clear sign of growing interest in the country's rich cultural heritage, which could translate into more investments in residential properties, particularly in historic locales.
There's a noticeable increase in the expat community in Guatemala, with many Europeans choosing to settle in vibrant areas like Guatemala City and Antigua. This trend points to a heightened interest in both living and investing in the country. In places like Antigua Guatemala, property prices are on the rise, driven by the demand for premium housing among affluent buyers. This suggests that European investors are already eyeing these attractive regions.
For those considering a move, Guatemala offers a unique blend of cultural richness and investment potential. The historic regions, with their charming architecture and vibrant communities, are particularly appealing. As more Europeans explore these opportunities, the demand for residential properties in these areas is expected to grow.
Investors are drawn to Guatemala not just for its beauty but also for its promising market dynamics. The combination of a growing expat population and increasing tourism makes it a compelling choice for those looking to invest in real estate. With property values on the rise, especially in historic areas, the potential for returns is significant.
As European interest in Guatemala continues to climb, the residential market in these culturally rich regions is poised for further growth. This trend is likely to attract even more investors, eager to capitalize on the opportunities presented by this vibrant and evolving market.
Sources: Statista, Expat Arrivals
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6) Demand for suburban homes near Guatemala City will rise as the middle class grows
Guatemala's economy is on the rise, with GDP per capita growing by 1.9% from 2014 to 2023, boosting the middle class's ability to buy homes.
As more people move to cities, urbanization rates have climbed to 2.2159% in 2023, especially around Guatemala City, which is seeing a population boom. This city is bustling, with an estimated 3,159,630 residents in 2024, pushing many to look for homes in the suburbs for more space and comfort.
There's a noticeable shift in poverty levels, dropping from 55% in 2023 to an expected 54.3% in 2024, hinting at a growing middle class. This group is increasingly eyeing suburban areas, drawn by the promise of a better lifestyle.
Consumer surveys show that as the middle class grows, their preference for suburban living becomes more evident. They are looking for homes that offer a balance of space, affordability, and quality of life.
Suburban developments near Guatemala City are becoming hot spots, driven by the expanding middle class's demand for better living conditions. These areas offer a mix of tranquility and accessibility to the city.
Sources: World Bank, Trading Economics, World Bank Document, World Population Review
7) Interest in suburban villas and large homes will decline as younger buyers prefer smaller, affordable units
In Guatemala, younger buyers are increasingly favoring urban living over suburban sprawl.
With the urban population expected to hit 67.3% by 2025, there's a clear trend towards city life. This shift is largely driven by the younger generation, who are looking for more compact and budget-friendly housing. The growing middle class is also a factor, as they seek homes that fit their financial constraints.
Globally, millennials and Gen Z are known for preferring smaller living spaces, and this is becoming evident in Guatemala too. The demand is not just for any small space, but for tech-smart and energy-efficient apartments. These features are becoming increasingly important as buyers look for sustainable living options.
Another interesting trend is the rise of co-living and shared spaces. This indicates that younger buyers are not just looking for affordability, but also for a sense of community. These arrangements offer a way to live in desirable urban areas without breaking the bank.
Suburban villas and large single-family homes are losing their appeal. The focus is shifting towards multi-family units and shared living spaces that offer both affordability and convenience. This change is reshaping the real estate landscape in Guatemala.
As the market evolves, it's clear that the future of housing in Guatemala is compact, efficient, and community-oriented. The younger generation is leading this change, opting for homes that reflect their values and lifestyle.
Sources: World Bank Document, Urban Institute
8) Property prices in Quetzaltenango will grow moderately as infrastructure gets better
In 2024, Guatemala is set to invest US$1 billion in infrastructure, with a significant focus on Quetzaltenango and its surroundings.
This investment includes projects like widening the regional ring road and building new bridges, hospitals, and highways. These developments are key to making the area more accessible and appealing for both living and business opportunities.
Quetzaltenango is also seeing improvements in public transportation, with the introduction of electric buses for TRANSMETRO, supported by CABEI. This upgrade is expected to make commuting easier and more efficient, which often leads to increased interest in moving to the area, potentially driving up property demand and prices.
Moreover, the USAID Creating Economic Opportunities Project is playing a crucial role by boosting investments in productive infrastructure, including road and transportation projects. These efforts are likely to stimulate economic activity, making Quetzaltenango a more vibrant place to live and work.
As economic activity picks up, the demand for housing and services is expected to rise, contributing to moderate price growth in the property market. This trend is particularly notable in secondary cities like Quetzaltenango, where infrastructure improvements are underway.
Sources: BNamericas, USAID
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.
9) Rural rental growth will be limited as more people move to cities
In Guatemala, more people are moving from rural areas to cities as urbanization accelerates.
With a high urbanization rate of 2.2159% in 2023, the country is on track to reach 67.3% urbanization by 2025. This shift is largely due to domestic migration, as people flock to cities in search of better job opportunities and living conditions.
Guatemala boasts the highest urban population growth rate in the region at 3.4%, driven by the allure of urban job markets. Cities are not just about jobs; they are also improving public services like lighting, water, and drainage, making them even more attractive.
As urban areas enhance their amenities, rural regions are seeing a decline in population growth. This trend is expected to continue, with urbanization projected to hit 80% by 2027, aligning with the Latin American average.
For potential property buyers, this means that rural areas may offer limited rentability growth as more people choose city life. The focus on urban development is leaving rural areas with fewer residents and, consequently, fewer opportunities for property investment.
Understanding these dynamics is crucial for anyone considering buying property in Guatemala, as the domestic migration to cities intensifies, shaping the real estate landscape.
Sources: Urban Population Growth in Guatemala, Urbanization and Migration Trends, Guatemala Overview
10) Demand for senior-friendly homes near healthcare facilities in Guatemala will grow as the population ages
Guatemala's life expectancy is climbing, hitting 75.26 years in 2024.
With people living longer, the country is seeing a growing elderly population. In 2023, 4.4055% of Guatemalan men were 65 or older, and this number is set to rise. This shift means more demand for homes that cater to seniors.
Healthcare spending per person is also increasing, indicating a rising need for accessible healthcare services. This makes it crucial for senior-friendly housing to be near medical facilities.
Guatemala is modernizing its hospital infrastructure through the INFRAIGSS project, which will enhance healthcare coverage. This is vital for the aging population, who will need more medical attention.
For those considering property investment, these trends suggest a growing market for senior-friendly homes close to healthcare services. The demand is likely to increase as the population ages.
Investing in such properties could be a smart move, given the ongoing improvements in healthcare infrastructure and the aging demographic.
Sources: MacroTrends, Trading Economics, World Bank, Proyectos Guatemala
11) Luxury rental yields in tourist areas will rise as Guatemala's tourism sector recovers and grows
Guatemala's tourism is booming, thanks to its visa-free entry policy for 83 countries.
With easy access for travelers from places like the USA and Schengen nations, the country has seen a surge in international visitors. This is evident from the increased number of tourists from Slovakia in December 2023, highlighting the appeal of Guatemala's diverse attractions.
La Aurora International Airport is busier than ever, with over 4.2 million passengers in 2023. This influx has led to a spike in demand for luxury rentals, where some areas boast occupancy rates of up to 98% during peak times like Easter and long weekends.
The government is not just sitting back; they're actively enhancing infrastructure to support this growth. This is expected to boost property values in tourist-heavy areas, making it a prime time for investment in luxury accommodations.
Tourists are increasingly opting for high-end lodging, driven by the positive reception of new luxury developments. This trend is a clear indicator of the growing preference for upscale experiences among visitors.
For those considering property investment, luxury rentals in these bustling tourist spots are likely to generate higher yields as Guatemala's tourism continues to thrive.
Sources: Travel and Tour World, Wikipedia
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12) Vertical housing in Guatemala City will increase to meet rising urban demand
Guatemala City is seeing a boom in vertical housing developments as urban demand grows.
With the city's population increasing by 64,530 people last year, the need for more housing options is clear. This growth, marking a 2.08% annual change, is pushing the city to expand upwards rather than outwards.
In 2023, the urban population in Guatemala grew by 2.2159%, highlighting the urgent need for housing solutions. The scarcity of horizontal land due to urbanization is making vertical housing a practical choice for developers.
Looking at other Latin American cities like Mexico City and Buenos Aires, there's a noticeable shift towards vertical living. This trend, driven by similar urbanization and land scarcity, is expected to take hold in Guatemala City as well.
International real estate investors are increasingly interested in Latin American cities, further fueling the move towards vertical housing in Guatemala City. This interest is a strong indicator of the city's potential for growth in this sector.
As the city continues to grow, the demand for vertical housing will likely increase, mirroring trends seen in other major urban centers across the region.
Sources: World Population Review, Trading Economics, CTBUH
13) Affordable housing returns will rise as government efforts aim to close the housing gap
Guatemala faces a housing shortage of over 1.3 million homes, especially in bustling urban areas like Guatemala City.
The government is stepping up with initiatives to tackle this issue, with the Central American Bank for Economic Integration (CABEI) funding sustainable housing projects. These projects are not just about building homes; they focus on energy efficiency, which means lower long-term costs and environmental benefits.
One standout example is the self-managed cooperative housing program, which has successfully provided homes for 225 families living below the poverty line. This program thrives on partnerships between the government, private developers, and other sectors, showing how collaboration can drive affordable housing success.
Investing in affordable housing in Guatemala is becoming increasingly attractive. With government backing and successful models like the cooperative housing program, there's a clear path to higher returns on investment in this sector.
As the demand for affordable housing continues to rise, especially in urban centers, these initiatives are crucial. They not only address the housing deficit but also offer a sustainable and profitable opportunity for investors.
With the right support and investment, affordable housing developments in Guatemala are poised to bridge the housing gap and offer significant returns.
Sources: Habitat for Humanity, CABEI, UHPH, Cross Catholic
14) Drone technology will boost real estate marketing by improving visibility for remote and hard-to-reach properties
Drone technology is revolutionizing real estate marketing, especially for properties that are off the beaten path.
In recent years, more realtors have embraced drones, with 35% using them to showcase listings. This shift underscores how much value drone photography adds to the industry. Imagine being able to see a property from above, capturing its full layout and surroundings in a way traditional photos just can't.
Homes with aerial shots tend to sell 68% faster than those with only standard images. Why? Because drone footage grabs attention, leading to more inquiries and offers. Buyers love virtual tours and aerial views since they give a complete picture of the property and its environment.
Thanks to advancements in technology, drones are now more accessible and affordable for real estate pros. This means more agents can use them to enhance their listings. Plus, the Federal Aviation Administration made it easier back in 2016 by loosening restrictions, paving the way for drones to become a staple in real estate marketing.
For those looking to buy in the countryside, drones offer a unique advantage. They can highlight features like expansive land, nearby amenities, or even potential development opportunities that might not be visible from the ground. This is a game-changer for properties that are hard to reach or tucked away.
So, if you're considering a rural property, keep an eye out for listings with drone footage. It might just give you the perspective you need to make a decision.
Sources: SkyVue Imaging, Tolj Commercial, Matterport
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.
15) Properties near transit hubs in Guatemala City will become more desirable as public transportation expands
The Metro Riel project in Guatemala City is set to make properties near transit hubs more attractive.
With a 21 km light rail system and 20 stations, this development is expected to boost property values, similar to what has happened in other cities. Imagine cutting down your commute time significantly, just like in Bogotá and Mexico City, where public transport improvements have made a big difference.
In these cities, systems like the Transmilenio have not only reduced travel times but also increased property values in nearby areas. Guatemala City is likely to follow this trend, making it a smart move to consider properties close to the new transit lines.
People love convenience, and real estate market analyses show that properties with easy access to public transit are in high demand. In Guatemala, areas like Zona 10 and Zona 4 are expected to see a rise in property values due to their proximity to these new transport links.
The government is investing in public transportation infrastructure, which means areas benefiting from these developments are likely to see a boost in property values. This is great news for potential buyers looking to invest in these neighborhoods.
So, if you're thinking about buying property in Guatemala City, keep an eye on areas near the new transit hubs. They could offer not just convenience but also a promising return on investment.
16) Interest in eco-friendly housing will grow due to tax incentives for green developments
Tax incentives are sparking interest in eco-friendly housing projects across Guatemala.
In recent years, organizations like the Central American Bank for Economic Integration (CABEI) have stepped up, offering financial support to boost sustainable housing in the country. This backing helps developers by easing their financial load, making it more appealing to invest in green projects.
Looking ahead, property prices in Guatemala are expected to climb in 2025, partly because of the rising demand for sustainable homes. This trend is driven by a growing middle class with more disposable income, who are increasingly drawn to the perks of eco-friendly living. Tech-savvy, energy-efficient apartments and spacious suburban homes are becoming hot commodities, turning green housing into a profitable venture for developers.
The Guatemalan government is also playing a key role in this shift. Their National Energy Efficiency Policy 2023-2050 is a testament to their commitment to sustainability. This policy not only aims to cut down on greenhouse gas emissions but also promotes the smart use of energy resources. Such initiatives align with the global push towards sustainable living, making green housing even more attractive.
With government support, consumer interest, and financial incentives all in the mix, the stage is set for eco-friendly residential projects to thrive. Developers are finding a welcoming environment to create homes that are not just good for the planet but also appealing to buyers.
As more people recognize the benefits of sustainable living, the demand for green housing is likely to keep growing. This creates a win-win situation for both developers and homeowners, as eco-friendly homes become more mainstream.
Sources: CABEI Support, Property Price Projections, Government Initiatives
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.