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Peru's property market is experiencing robust growth with record-high sales volumes and attractive rental yields.
As of September 2025, the Peruvian real estate market presents favorable conditions for buyers, with home sales in Lima increasing by 25% in the first half of 2025, competitive mortgage rates at 7.44%, and rental yields averaging 5.97% nationally. The combination of stable economic growth, controlled inflation at 1.7%, and supportive government policies makes Peru an attractive destination for both investment and residential purposes.
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Peru's property market shows strong fundamentals with 25% sales growth in Lima and stable price increases of 0.74% nationally.
The market benefits from low mortgage rates, controlled inflation, and government incentives supporting both local and foreign buyers.
| Market Indicator | Current Status (September 2025) | Outlook |
|---|---|---|
| Property Prices (National) | +0.74% YoY growth | 3-7% nominal growth forecasted through 2026 |
| Mortgage Interest Rates | 7.44% (multi-year lows) | Expected to remain stable |
| Rental Yields | 5.97% national average | Slight decline expected but remain competitive |
| Economic Growth | 3.1-4.0% GDP growth forecast | Continued steady growth |
| Inflation Rate | 1.7% (within 1-3% target) | Expected to remain controlled |
| Foreign Buyer Access | Minimal restrictions | No changes expected |
| Government Support | Multiple incentive programs active | Continued policy support |
What's the current state of the property market in Peru?
Peru's property market is experiencing strong momentum as of September 2025.
Lima's residential market shows particularly robust activity with home sales increasing by 25% in the first half of 2025 compared to the previous year. Sales volumes have reached record highs across major Peruvian cities, indicating strong buyer demand and market confidence.
The buyer profile shows clear preferences for smaller, well-located properties between 60-70 square meters, particularly in premium Lima districts such as San Miguel, JesĂşs MarĂa, Miraflores, and Surco. Two- and three-bedroom units represent the hottest market segment, reflecting both affordability constraints and practical living preferences.
Most activity concentrates in urban centers, with Lima leading the market followed by secondary cities like Arequipa and Trujillo. The market demonstrates healthy fundamentals with steady transaction volumes and stable pricing trends across different property types.
How are property prices trending right now?
Property prices in Peru show stable, modest growth with regional variations as of September 2025.
National property prices increased by 0.74% year-over-year as of March 2025, while Lima specifically saw a more modest 0.27% increase to an average of S/452,900. These figures represent nominal growth, but when adjusted for inflation, real prices remain either stable or show slight declines.
The pricing trend reflects a balanced market where demand growth aligns with supply, preventing dramatic price spikes. In nominal terms, most markets see annual increases of 3-7%, but the low inflation environment means buyers maintain purchasing power.
Different districts within Lima show varying price movements, with premium areas like Miraflores and San Isidro maintaining higher price levels, while emerging neighborhoods offer more affordable entry points with steady appreciation potential.
What are experts saying about the future of real estate values in Peru?
Real estate experts express cautious optimism about Peru's property market outlook through 2026.
Industry forecasts predict nominal price growth of 3-7% annually through 2026, with Lima and key secondary cities like Arequipa and Trujillo showing the strongest prospects. However, experts note that much of this growth may be offset by inflation, keeping real price appreciation moderate.
The primary drivers supporting price growth include sustained job creation, infrastructure investment, and stable macroeconomic conditions. Long-term forecasts from 2027-2035 anticipate continued urbanization and rising middle-class incomes to sustain housing demand and support steady price appreciation.
Expert consensus emphasizes that price stability depends heavily on maintaining political stability, particularly around the 2026 elections. Market fundamentals remain strong, but political uncertainty represents the primary risk factor for future price performance.
It's something we develop in our Peru property pack.
What's happening with interest rates and mortgage availability in Peru?
Mortgage conditions in Peru are currently very favorable for property buyers as of September 2025.
Mortgage interest rates have reached multi-year lows at 7.44% as of June 2025, down significantly from earlier highs. The Central Bank maintains its benchmark rate at a stable 4.5%, supporting continued access to affordable credit for property purchases.
Mortgage lending has reached record levels with total lending hitting 72.6 billion PEN in June 2025. Lenders are actively expanding their mortgage portfolios, with approximately 36,000 new mortgage loans forecast for 2025, representing an 8% increase from 2024.
Credit availability has improved significantly due to the combination of lower rates and rising incomes, making homeownership more accessible to a broader range of buyers. Banks are showing increased appetite for mortgage lending given the stable economic environment and low default rates.
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How stable is the Peruvian economy at the moment?
Peru's economy demonstrates strong stability and growth momentum as of September 2025.
GDP growth forecasts for 2025 range from 3.1% to 4.0%, positioning Peru among the fastest-growing economies in Latin America. This growth rate significantly exceeds regional averages and indicates robust economic fundamentals supporting property market stability.
Employment conditions continue improving with falling unemployment rates and increasing formal job creation. The expansion of formal employment directly supports mortgage qualification and housing demand, creating a positive cycle for the property market.
Economic diversification across mining, agriculture, manufacturing, and services provides resilience against sector-specific shocks. Peru's stable currency and manageable debt levels further support long-term economic stability and property market confidence.
What's the inflation rate and how is it affecting property affordability?
Peru maintains excellent inflation control with significant benefits for property affordability.
| Inflation Metric | Current Rate (September 2025) | Impact on Property Market |
|---|---|---|
| Annual CPI Inflation | 1.7% | Well within 1-3% central bank target |
| Mortgage Rate Impact | Supports low rates | 7.44% mortgages remain affordable |
| Real Income Growth | Positive | Improves buyer purchasing power |
| Construction Costs | Stable increases | Predictable development costs |
| Rental Affordability | Maintained | Supports rental yield stability |
Are there any new government policies or tax incentives for buyers?
Peru offers extensive government support programs for property buyers in 2025.
The "Mivivienda" program provides substantial subsidies covering 10-20% of a home's value for qualifying families. Additional programs include the Bono del Buen Pagador, MiVivienda Verde for eco-friendly properties, and various social housing incentives targeting different income levels.
New "green mortgage" incentives specifically support sustainable housing purchases, offering preferential rates and additional subsidies for energy-efficient properties. These programs align with Peru's environmental goals while making homeownership more accessible.
Tax advantages include a flat 5% tax rate on rental income, principal residence capital gains exemption after 2+ years of occupancy, and annual property taxes ranging from 0.2-1% of assessed value. The 3% transfer tax includes a $15,000 deduction, reducing transaction costs for most buyers.
FIBRI and FIBRA investment funds provide additional incentives for real estate investors, while tax treaties offer benefits for international buyers from specific countries.
How easy is it for foreigners to buy property in Peru?
Foreign property ownership in Peru faces minimal restrictions and follows straightforward procedures.
Foreigners can purchase property throughout Peru with the only restriction being areas within 50 kilometers of national borders, which require government approval for security reasons. This restriction affects a small percentage of available properties and doesn't impact major urban markets.
The legal requirements include obtaining a Peruvian tax identification number (RUC) and conducting proper title verification through the property registry system. Peru's title system provides reliable protection for buyers who follow proper due diligence procedures.
Property ownership does not automatically grant residency rights, but Peru offers various residency pathways for individuals who can demonstrate sufficient income or investment. Property ownership can support residency applications by demonstrating financial stability and commitment to Peru.
The transaction process typically takes 30-60 days and requires notarization, title verification, and registration with the property registry. Legal representation is recommended but not mandatory, though it significantly reduces transaction risks.
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 major Peruvian cities?
Rental yields in Peru remain attractive compared to regional and international markets as of September 2025.
| City/Area | Average Rental Yield | Best Performing Districts |
|---|---|---|
| Lima (Overall) | 6.45% | Surquillo, Barranco, San Miguel (6.5-7.5%) |
| Arequipa | 5.49% | Central districts |
| Trujillo | 5.5% | Urban core areas |
| National Average | 5.97% | Varies by property type |
| Studio/1-Bedroom (Lima) | 6.5-7.5% | High demand areas |
| Larger Units (Lima) | 5.5-6.0% | Premium districts |
How safe and reliable is the property buying process in Peru?
Peru's property buying process offers strong legal protections and transaction security for diligent buyers.
The country maintains a well-established property registry system that provides reliable title verification and ownership protection. The legal framework follows civil law traditions with clear procedures for property transfers and ownership registration.
Transaction security depends heavily on proper due diligence, including comprehensive title searches, verification of seller ownership, and checks for outstanding debts or liens. Buyers who follow established procedures and engage qualified legal counsel face minimal transaction risks.
The notary system provides additional security by verifying document authenticity and ensuring proper legal procedures. All property transactions must be notarized and registered with the public registry to be legally valid and enforceable.
It's something we develop in our Peru property pack.
What risks should buyers be aware of in the current market?
Property buyers in Peru should consider several risk factors when making purchase decisions in 2025.
Political uncertainty represents the primary risk, particularly with the 2026 elections approaching. Changes in government could potentially affect property policies, tax structures, or foreign investment regulations, though Peru's democratic institutions provide stability.
Market imbalances could develop in high-demand areas with constrained supply, potentially leading to price volatility. While this supports current property values, rapid price movements could create affordability challenges or market corrections.
Regulatory changes in popular districts could affect development potential or rental regulations. Some Lima districts have implemented zoning changes that impact future development rights and property values.
The modest real price growth after inflation adjustment means buyers shouldn't expect dramatic appreciation. Properties should be evaluated based on rental income potential and long-term stability rather than rapid price gains.
Transaction risks include inadequate due diligence, unclear property titles, hidden debts or liens, and dealing with unqualified intermediaries. These risks are manageable through proper legal representation and thorough verification processes.
Given my personal financial situation, would buying now make sense for me?
The decision to buy property in Peru depends on your specific financial circumstances and investment objectives.
Current market conditions favor buyers with stable income, adequate down payment savings, and long-term investment horizons. The combination of low mortgage rates, stable prices, and attractive rental yields creates favorable entry conditions for qualified buyers.
Consider buying now if you have secure employment, can comfortably afford mortgage payments at current rates, and plan to hold the property for at least 3-5 years. The market rewards patient investors who focus on rental income and steady appreciation rather than quick gains.
International buyers should evaluate currency exposure, residency plans, and property management arrangements if investing from abroad. Peru's stable economic fundamentals reduce currency risk compared to other Latin American markets.
Avoid buying if you lack sufficient emergency funds, face job uncertainty, or need quick liquidity from your investment. Property markets require financial stability and patience to achieve optimal returns.
It's something we develop in our Peru property pack.
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.
Peru's property market in September 2025 presents favorable conditions for both investors and residents, with strong fundamentals supporting steady growth and attractive returns.
The combination of low mortgage rates, controlled inflation, government incentives, and stable economic growth creates an environment conducive to property investment, particularly for buyers with long-term perspectives and solid financial foundations.
Sources
- HomeReady Global - More Peruvians Are Buying Homes in 2025
- The LatinVestor - Peru Price Forecasts
- Trading Economics - Peru Residential Property Prices
- The Global Economy - Peru Mortgage Interest Rate
- Trading Economics - Peru Interest Rate
- BBVA Research - Peru Inflation Analysis
- Global Property Guide - Peru Rental Yields
- The LatinVestor - Peru Real Estate Market