Authored by the expert who managed and guided the team behind the Peru Property Pack
Yes, the analysis of Lima's property market is included in our pack
Lima's property market is experiencing strong momentum in 2025, making it an attractive time for both investors and homebuyers to consider purchases.
Property prices have risen 10% year-on-year citywide, with mortgage rates dropping to 7.44% from previous peaks above 10%. The Peruvian economy has bounced back robustly with 3.92% GDP growth in Q1 2025, while inflation remains controlled at just 1.7%. Strong demand, healthy foreign investment, and attractive rental yields of around 6% position Lima as one of South America's most promising real estate markets.
If you want to go deeper, you can check our pack of documents related to the real estate market in Peru, based on reliable facts and data, not opinions or rumors.
Lima's property market shows strong fundamentals with 10% price growth, declining mortgage rates, and robust economic recovery making September 2025 an opportune time to buy.
Key factors supporting property purchases include controlled inflation at 1.7%, GDP growth approaching 4%, and attractive rental yields averaging 6% across the city.
| Market Indicator | Current Status | Trend |
|---|---|---|
| Average Property Price | USD 1,500/m² | +10% year-on-year |
| Mortgage Interest Rate | 7.44% | Declining from 10%+ peak |
| GDP Growth | 3.92% (Q1 2025) | Strong recovery |
| Inflation Rate | 1.7% | Well within target range |
| Rental Yields | 6% average | Competitive regionally |
| Currency Stability | 3.65-3.75 PEN/USD | Relatively stable |
| Foreign Investment | Strong participation | Continued growth |
What's the current average property price in Lima?
Property prices in Lima vary significantly by district, with the citywide average sitting at approximately USD 1,500 per square meter as of September 2025.
The most exclusive districts like Miraflores and San Isidro command premium prices up to USD 2,500 per square meter, reflecting their prime locations, luxury amenities, and oceanfront access. These areas attract both high-end local buyers and international investors seeking prestigious addresses.
Mid-range districts including Jesús María, Magdalena, and San Miguel offer more accessible pricing between USD 1,000-1,300 per square meter. These neighborhoods provide good infrastructure, shopping centers, and transportation links while remaining within reach of middle-class buyers. Emerging districts present the most affordable entry points, with prices starting as low as USD 800 per square meter in areas experiencing urban development and infrastructure improvements.
For practical reference, a typical 2-bedroom apartment of 60 square meters costs approximately USD 110,000 in Lima's residential market. This price point represents solid value compared to other major South American capitals.
It's something we develop in our Peru property pack.
How have property prices in Lima changed over the past 12 months?
Lima's property market has demonstrated strong upward momentum with average property prices increasing 10% year-on-year across the city as of September 2025.
The growth has been particularly pronounced in specific districts, with emerging areas like Chorrillos experiencing exceptional price increases of up to 19% over the past year. This surge reflects increased investor interest in previously undervalued neighborhoods that are benefiting from infrastructure development and urban renewal projects.
This recent performance builds on a solid foundation of consistent growth over the medium term. Over the past five years, Lima's property market has averaged approximately 5% annual price appreciation, indicating that the current 10% growth represents an acceleration of existing trends rather than an unsustainable spike.
The price increases have been broad-based across property types, from apartments to single-family homes, suggesting fundamental demand-supply dynamics rather than speculative bubbles in specific segments. Both domestic and foreign buyers have contributed to this price momentum through increased purchasing activity.
What's the current interest rate for a mortgage in Peru?
Mortgage interest rates in Peru have become significantly more attractive, currently averaging 7.44% as of September 2025, representing a substantial decline from previous peaks.
This current rate marks a dramatic improvement from early 2023 when mortgage rates exceeded 10%, making property purchases considerably more expensive for buyers requiring financing. The decline reflects Peru's Central Bank monetary policy response to improved economic conditions and controlled inflation.
The lower interest rate environment has stimulated property buying activity by expanding access to financing for middle-class buyers who were previously priced out of the market. Monthly mortgage payments have decreased substantially, allowing buyers to afford higher-priced properties or reducing the financial burden on existing purchase plans.
For international buyers, these rates compare favorably to mortgage costs in many developed markets, enhancing Lima's attractiveness as an investment destination. The trend toward lower rates is expected to continue supporting property demand throughout 2025 and into 2026.
How stable is the Peruvian economy right now?
Peru's economy is demonstrating robust stability and growth momentum as of September 2025, with GDP expanding 3.92% in Q1 2025 and annualized growth approaching 4%.
This performance represents a strong recovery from the recession experienced in 2023, supported by healthy expansion across key sectors including mining, construction, and manufacturing. The construction sector's contribution is particularly relevant for property buyers, as it indicates continued infrastructure development and housing supply growth.
The economy benefits from Peru's diverse export base, strong mining sector, and improving domestic consumption patterns. Government fiscal policies have supported growth while maintaining reasonable debt levels, providing a stable macroeconomic environment for property investments.
However, political instability remains a notable risk factor, with frequent cabinet changes creating some uncertainty in policy implementation. Despite this political volatility, economic fundamentals remain solid with inflation controlled and growth targets of 3.5-4% appearing achievable based on current trajectories.
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What's the current inflation rate in Peru?
Peru's inflation rate stands at a very manageable 1.7% year-on-year as of July 2025, well within the Central Bank's target range of 1-3%.
This controlled inflation environment provides excellent conditions for property investment, as it maintains purchasing power while avoiding the price volatility that can destabilize real estate markets. The low inflation rate also supports the Central Bank's ability to maintain accommodative monetary policy, keeping interest rates relatively low.
Economic forecasts indicate inflation is expected to remain comfortably below 2% for most of 2025, providing predictability for property buyers planning medium to long-term investments. This stability contrasts favorably with many other Latin American countries experiencing higher inflation pressures.
For property investors, low inflation means rental income and property values maintain real purchasing power over time, while financing costs remain stable. The controlled inflation environment also supports continued economic growth and consumer confidence.
Is there strong demand for property in Lima at the moment?
Lima's property market is experiencing exceptionally strong demand, with new home sales jumping 30% in the first half of 2025 compared to the same period in 2024.
The market has shifted decisively toward a seller's market in desirable areas, with vacancy rates expected to end 2025 around 5%, indicating healthy demand-supply balance. This tight market condition gives sellers pricing power while ensuring properties move quickly when properly priced.
Pre-sales activity demonstrates particularly robust demand, with 70-80% of units being sold before project completion. This strong pre-sales performance indicates buyer confidence in the market and developers' ability to deliver projects that meet market demand.
Demand is being driven by multiple factors including improved economic conditions, lower mortgage rates, growing middle class wealth, and continued urbanization trends. Both domestic buyers seeking primary residences and investors pursuing rental properties are contributing to the strong demand environment.
It's something we develop in our Peru property pack.
Are there many properties available for sale in Lima right now?
Lima maintains a healthy inventory of properties available for sale across various districts and property types, with no evidence of significant oversupply in the market.
The property inventory spans from luxury developments in premium districts to affordable housing options in emerging neighborhoods, providing choices for buyers across different budget ranges. New construction projects continue to add supply, but absorption rates have kept pace with development activity.
Market observers consider the current inventory levels appropriate for a growing metropolitan area of Lima's size, avoiding both oversupply conditions that could depress prices and severe shortages that could create affordability crises.
The availability varies by district and price segment, with luxury properties in exclusive areas having more limited supply compared to mid-range and affordable housing options. This distribution reflects the natural market segmentation and development patterns in the city.
Are there any upcoming government policies or tax changes that could impact property prices?
No new punitive property taxes or ownership restrictions have been announced by the Peruvian government that would negatively impact property prices or foreign investment in Lima's real estate market.
Existing tax incentives for Real Estate Investment Funds and REITs have been extended through 2026, maintaining favorable conditions for institutional property investment. These incentives help attract capital to the real estate sector and support continued development activity.
Peru ratified the OECD Multilateral BEPS Convention effective October 2025, which strengthens anti-tax-avoidance rules for multinational investors. However, this change is not expected to immediately impact individual property transactions and primarily affects complex corporate tax structures.
The government's focus remains on supporting economic growth and housing development rather than implementing restrictive policies. Property buyers can proceed with confidence that the regulatory environment remains supportive of real estate investment and ownership.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Peru 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.
What are rental yields like in Lima compared to other cities?
Lima offers attractive rental yields averaging 6% across the city, with yields ranging from 4.4% to 7.8% depending on the specific district and property type.
| District Type | Average Rental Yield | Yield Range |
|---|---|---|
| Prime Residential (Miraflores, San Isidro) | 4.4-5.2% | Lower yields, higher capital appreciation |
| Mid-Range Districts | 5.5-6.5% | Balanced yield and growth potential |
| Emerging Areas | 6.5-7.8% | Higher yields, moderate appreciation |
| Commercial Properties | 7-9% | Higher yields, different risk profile |
| Student Housing | 8-10% | Specialized market segment |
These yields compare very favorably to other major South American cities, with Lima exceeding most regional gateway cities as of mid-2025. The combination of reasonable property prices and strong rental demand creates this attractive yield environment for investors.
It's something we develop in our Peru property pack.
Is the local currency stable or showing signs of volatility?
The Peruvian Sol (PEN) demonstrates relative stability, trading within a narrow range of 3.65-3.75 per USD throughout 2025.
This stability provides confidence for both domestic and international property buyers, as currency fluctuations can significantly impact investment returns for foreign buyers or local buyers using USD-denominated financing.
Some mild pressure on the Sol may emerge heading into the 2026 elections as political uncertainty typically creates currency volatility in emerging markets. However, major currency volatility is not currently expected given Peru's solid economic fundamentals and controlled inflation.
For international property investors, the current currency stability means investment returns are primarily driven by property market performance rather than currency movements, providing clearer investment decision-making parameters.
Are there signs of significant foreign investment in Lima's real estate market?
Lima's real estate market continues to attract strong foreign investment participation, with international buyers enjoying the same property ownership rights as local buyers except in border areas.
Foreign investors are drawn to Lima by several factors including tax incentives, robust rental yields, legal reforms supporting property rights, and the favorable economic environment. Both individual investors and institutional capital continue flowing into the Lima property market.
The government maintains policies that encourage rather than restrict foreign property investment, recognizing its contribution to economic growth and development. This supportive stance contrasts with some other countries that have implemented foreign buyer taxes or ownership restrictions.
International capital continues targeting various property segments from luxury residential developments to commercial properties and emerging district investments, demonstrating broad-based confidence in Lima's real estate market potential.
How do property experts and analysts see the Lima housing market evolving over the next year?
Property analysts forecast continued moderate price growth of 3-7% annually for Lima's housing market through 2025-2026, reflecting optimism about underlying market fundamentals.
The consensus outlook points to sustained appreciation driven by ongoing infrastructure development, continued demand for modern housing, and a resilient Peruvian economy. Infrastructure projects including transportation improvements and urban development initiatives are expected to support property values across multiple districts.
Emerging districts are expected to outperform established areas in terms of price appreciation, as they benefit from urban expansion and infrastructure investments while starting from lower price bases. This creates opportunities for investors seeking higher growth potential.
Political uncertainty and global macroeconomic volatility remain the primary risks that could disrupt this positive outlook. However, most analysts believe Lima's property market fundamentals are strong enough to weather moderate political or economic disruptions.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Lima presents compelling conditions for property buyers in September 2025, with strong economic recovery, controlled inflation, and attractive financing costs creating an opportune environment for real estate investment.
The combination of 10% price growth, declining mortgage rates, and healthy rental yields positions Lima as one of South America's most promising property markets for both investors and homebuyers seeking quality opportunities.
Sources
- Lima Price Forecasts - The LatinVestor
- Lima Market Data About Real Estate Market - The LatinVestor
- Peru Mortgage Interest Rate - The Global Economy
- Peru Mortgage Interest Rate - Global Property Guide
- Peru's Economy Soars 4.67% in March - Rio Times Online
- Peru Economic Outlook March 2025 - BBVA Research
- OECD Economic Outlook Peru - OECD
- Peru Inflation CPI - Trading Economics
- Lima Property - The LatinVestor
- Real Estate Investment in Peru - Ecovis
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