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Peru's residential property market presents a mixed picture as we reach mid-2025. While nominal prices show modest growth, real values continue to decline when adjusted for inflation. Lima's prime districts see stronger performance, but the national market remains relatively stable with signs of both opportunity and caution for potential buyers.
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Peru's property prices are experiencing nominal growth of 3-7% annually, but when adjusted for inflation, real prices are actually declining. The market outlook remains cautiously optimistic with regional variations, particularly stronger growth in Lima's prime districts and secondary cities like Arequipa and Trujillo.
| Key Indicator | Current Status (June 2025) | Trend |
|---|---|---|
| National Price Growth (Nominal) | 0.1% YoY (Q3 2024) | Stable but weak |
| Real Price Growth (Inflation-adjusted) | -1.7% YoY (Q3 2024) | Declining |
| Lima Top Districts Price/m² | US$2,000 | Rising 8-12% |
| Mortgage Interest Rates | 8.2-8.3% | Decreasing |
| Central Bank Rate | 4.5% | Stable |
| 2025 GDP Growth Forecast | 3.1-4.0% | Positive |
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.
What are the current property price levels in Peru as of June 2025?
Property prices in Peru vary significantly by location and property type, with Lima commanding the highest prices in the country.
In Lima's most exclusive districts, known as "Lima Top" (including Miraflores, San Isidro, and Surco), average prices have reached US$2,000 per square meter. These prime areas continue to attract both domestic affluent buyers and international investors seeking quality properties in established neighborhoods.
The middle-income districts of Lima, referred to as "Lima Moderna," offer more accessible options with prices ranging from US$1,000 to US$1,300 per square meter. These areas provide a balance between affordability and urban amenities, making them popular among Peru's growing middle class.
Nationally, new residential units are typically priced between S/300,000 and S/650,000 (approximately US$80,000 to US$175,000), depending on location, size, and amenities. This price range reflects the diverse market conditions across Peru's various regions and cities.
Secondary cities like Arequipa, Trujillo, and Piura show lower price points but are experiencing increased demand due to urbanization and economic development, with prices generally 30-50% below Lima's averages.
How much have property prices increased in Peru during 2024-2025?
Peru's property price growth shows a tale of two markets - modest national increases contrasted with stronger performance in specific urban areas.
Nationally, the hedonic property price index rose by just 0.1% year-on-year in Q3 2024, following similarly modest growth of 0.5% in Q2 2024 and 1.5% in Q1 2024. This represents a significant deceleration from the 2.9% growth recorded in Q4 2023.
When adjusted for inflation, the picture becomes more concerning. Real property prices actually fell by 1.7% in Q3 2024 compared to the previous year, with the real residential property price index showing a decline of 1.87% in September 2024.
However, Lima tells a different story. The capital city saw prices rise by 8% in the first half of 2024, with top districts like Miraflores, San Isidro, and Surco experiencing increases of up to 12%. This divergence highlights the concentration of demand in prime urban locations.
The Lima real estate sector showed particularly strong performance with 30% growth in transaction volumes in 2024 compared to 2023, indicating robust market activity despite the modest price increases at the national level.
Where are property prices rising fastest in Peru?
Lima remains the epicenter of Peru's property price growth, but several secondary cities are emerging as hotspots for real estate investment.
Lima's prime districts continue to lead price appreciation, with Miraflores, San Isidro, Barranco, and Surco showing the strongest performance. These areas benefit from established infrastructure, proximity to business centers, and appeal to both domestic and international buyers. Price increases in these districts have reached 12% in 2024.
| City/Region | Key Growth Drivers | Price Growth Outlook |
|---|---|---|
| Lima (Prime Districts) | International demand, limited supply, infrastructure | 8-12% annually |
| Arequipa | Urbanization, housing deficit, mining economy | 9% projected for 2025 |
| Trujillo | Infrastructure development, economic diversification | 5-7% annually |
| Piura | Agricultural exports, urban migration | 4-6% annually |
| Chiclayo | Commercial hub, growing middle class | 4-5% annually |
| Cusco | Tourism recovery, international interest | 3-5% annually |
| Iquitos | Amazon development, oil sector | 2-4% annually |
Secondary cities are experiencing rapid growth due to infrastructure investments, economic diversification, and urban migration. Arequipa stands out with projected 9% price growth in 2025, driven by a severe housing deficit growing at 6% annually and steady demand from new families.
It's something we develop in our Peru property pack.
Which property types are experiencing the strongest price growth?
Certain property types in Peru are outperforming the broader market, driven by changing lifestyle preferences and demographic shifts.
Luxury apartments and high-end houses in Lima's prime districts are leading price growth, attracting demand from expatriates, returning Peruvians, and affluent locals. These properties, particularly those with modern amenities and security features, command premium prices and show the strongest appreciation.
Tech-equipped, energy-efficient apartments are seeing exceptional demand, especially among young professionals and tech workers. Properties featuring smart home technology, solar panels, and energy-saving systems are achieving price premiums of 10-15% over traditional units.
Family-sized suburban homes are experiencing increased interest as remote work becomes more common. Properties with 3-4 bedrooms, outdoor spaces, and home office areas in Lima's expanding suburbs are seeing strong price appreciation of 5-8% annually.
Properties with outdoor spaces - terraces, balconies, or gardens - have become highly desirable post-pandemic. In dense urban areas like Lima, these features can add 15-20% to property values.
Urban land parcels are appreciating rapidly due to scarcity and development pressure, particularly in areas designated for mixed-use development or near new infrastructure projects.
What are current mortgage rates in Peru as of June 2025?
Mortgage financing conditions in Peru have improved significantly, supporting increased property demand despite rates remaining relatively high by international standards.
As of June 2025, average mortgage rates in Peru stand at approximately 8.2-8.3%, down from peaks of over 10% in early 2023. This decline follows the Central Bank of Peru's monetary easing cycle, which has brought the benchmark rate down to 4.5% from previous highs.
For Peruvian Sol (PEN)-denominated mortgages, rates average 7.41% as of late 2024, while foreign currency-denominated loans (primarily in US dollars) offer slightly lower rates around 6.32%. However, borrowers face exchange rate risk with dollar-denominated loans.
The mortgage market shows several key trends: increasing preference for Sol-denominated loans to avoid currency risk, growing competition among banks leading to better terms, expansion of government-backed mortgage programs, and improved accessibility for middle-income borrowers.
Programs like Nuevo Crédito Mivivienda offer financing for properties valued between S/64,200 and S/464,200, covering up to 90% of the property value. The Bono del Buen Pagador provides additional incentives for timely payments, making homeownership more accessible.
What do experts forecast for Peru property prices in 2026 and beyond?
Real estate experts and economists project moderate but steady growth for Peru's property market over the coming years, with significant regional variations.
Short-term forecasts for 2025-2026 indicate nominal price growth of 3-7% annually in Lima, with real appreciation remaining minimal due to inflation. Secondary cities are expected to see 2-5% annual growth, with Arequipa potentially outperforming at 9% due to severe supply constraints.
| Time Period | Lima Forecast | Key Factors |
|---|---|---|
| 2025-2026 | 3-7% nominal growth | Election uncertainty, infrastructure completion |
| 2027-2030 | 4-5% annual growth | Political stability dependent, urbanization continues |
| 2030-2035 | Steady appreciation | Middle class expansion, sustainable housing demand |
| 2035-2045 | Moderate long-term growth | Demographics, urban development, tech adoption |
Medium-term projections for 2027-2030 suggest continued steady growth, though much depends on political stability following the 2026 elections. Infrastructure projects completing in 2027-2028 are expected to boost connected areas by 10-15%.
By 2035, experts anticipate Lima and major secondary cities will see the highest cumulative price growth, driven by continued urbanization, a growing middle class, and ongoing infrastructure improvements. Sustainable and tech-enabled housing will dominate new development.
Long-term forecasts through 2045 remain speculative but suggest sustained price appreciation in major urban centers, supported by demographic trends and continued economic development.
How is Peru's 2025 economic performance affecting property prices?
Peru's economic recovery in 2025 is providing a supportive backdrop for the property market, though challenges remain.
GDP growth is projected at 3.1-4.0% for 2025, positioning Peru as Latin America's second-fastest growing economy after Argentina. This economic expansion is driven by high commodity prices, particularly copper and gold, along with increased infrastructure investment.
Inflation has stabilized within the Central Bank's target range of 1-3%, with current levels around 1.65-2.0%. This price stability supports consumer confidence and preserves purchasing power for potential property buyers.
Employment conditions are improving, with formal sector job creation supporting household income growth. This is particularly benefiting middle-income segments that drive much of Peru's residential property demand.
The combination of economic growth, controlled inflation, and improving employment creates favorable conditions for property market stability, though real price appreciation remains constrained by still-elevated mortgage rates and political uncertainties.
Infrastructure investments, including the $3.6 billion Chancay mega-port and various transportation projects, are creating positive spillover effects for nearby property markets.
What government policies are influencing Peru's housing market in 2025?
Government intervention in Peru's housing market continues through various programs aimed at increasing homeownership accessibility.
The expansion of social housing programs remains a priority, with Nuevo Crédito Mi Vivienda and Techo Propio receiving increased funding. In 2024, the government introduced the Integrator BBP subsidy of US$895 to support first-time buyers.
These programs target low and middle-income buyers, helping to sustain demand in the affordable housing segment. Qualifying families can access subsidies covering 10-20% of property values, significantly improving affordability.
Regulatory changes aimed at streamlining construction permits and reducing bureaucracy are helping to increase housing supply, particularly in Lima and secondary cities where demand is strongest.
The government's infrastructure investment program, totaling over $8 billion for 2024-2025, indirectly supports property values by improving connectivity and urban amenities in developing areas.
However, municipal restrictions in high-demand zones and regulatory uncertainty continue to limit new supply in some prime areas, creating potential market imbalances that could support price growth in these locations.
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How does Peru's property market compare to other Latin American countries?
Peru's residential property market performance lags behind several regional peers, though it offers relative stability.
Over the past five years, Peru's nominal price growth of 3.1% is lower than Chile, Brazil, Colombia, and Mexico. In 2024, Peru's real property price index declined by 1.87%, while Brazil grew 2.7%, Chile 2.1%, and Mexico 3.9%.
However, Peru's market stability and open foreign ownership policies make it attractive for risk-averse investors. Unlike some neighbors, Peru allows unrestricted foreign property ownership except near international borders.
Rental yields in Peru remain competitive at around 6%, higher than many developed markets and comparable to regional standards. This provides steady income potential for investment properties.
Peru's mortgage market remains underdeveloped at just 6.3% of GDP, suggesting significant growth potential as financial inclusion improves. This contrasts with more mature markets like Chile where mortgage penetration exceeds 25% of GDP.
While not the fastest-growing market in Latin America, Peru offers a balance of stability, reasonable yields, and long-term growth potential that appeals to certain investor profiles.
What factors could impact Peru property prices in the second half of 2025?
Several key factors will shape Peru's property market trajectory through the remainder of 2025 and into 2026.
Political uncertainty ahead of the 2026 presidential elections poses the most significant risk. Investors typically adopt defensive positions 12-18 months before elections, which could dampen demand for luxury properties and slow new project launches.
External economic factors including global trade tensions, commodity price volatility, and potential slowdowns in China could impact Peru's export-dependent economy. Any significant economic disruption would likely affect property demand.
Interest rate movements remain crucial. While the Central Bank has paused rate cuts at 4.5%, any future monetary tightening to combat inflation could increase mortgage costs and reduce affordability.
Infrastructure project completion timelines will influence local property values. Delays in major projects like metro extensions or highway improvements could postpone expected price appreciation in affected areas.
Climate factors, particularly El Niño effects, could impact construction costs and timeline, potentially constraining supply and supporting prices in unaffected areas. It's something we analyze in detail in our Peru property pack.
We made this infographic to show you how property prices in Peru 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.
Which areas in Peru offer the best investment potential for 2025-2026?
Investment opportunities in Peru's property market vary significantly by location and property type.
Lima's emerging districts present compelling opportunities, particularly areas benefiting from metro line extensions and urban regeneration projects. Districts like San Juan de Lurigancho and Villa El Salvador offer entry points at lower prices with significant upside potential.
- Districts connected to new Lima Metro stations - properties within 1km of stations typically see 15-20% appreciation
- Coastal areas outside central Lima - beachfront communities attracting remote workers and retirees
- Mixed-use development zones - areas rezoned for commercial and residential use show strong potential
- University districts - steady rental demand from students ensures consistent income
- Industrial conversion areas - former industrial zones being redeveloped into residential communities
Secondary cities offer diversification benefits. Arequipa's severe housing shortage and 9% projected price growth make it particularly attractive. Trujillo benefits from agricultural export growth and improved connectivity to Lima.
For risk-tolerant investors, pre-construction opportunities in approved developments offer potential discounts of 10-15% versus completed units, though buyers must carefully evaluate developer track records.
Are property prices in Peru expected to continue rising through 2026?
The outlook for Peru's property market through 2026 suggests continued but moderate price growth with significant variations by location and property type.
Market fundamentals support modest appreciation: urbanization continues at 2-3% annually, the middle class is expanding, infrastructure investments are improving connectivity, and government housing programs sustain demand in affordable segments.
However, several factors constrain rapid price growth: political uncertainty surrounding 2026 elections, real prices declining despite nominal increases, high mortgage rates limiting affordability, and weak luxury segment performance.
The most likely scenario sees nominal price growth of 3-7% annually in prime urban areas, with inflation eroding much of these gains. Secondary cities may outperform due to lower base prices and rapid development.
Investors should focus on properties with strong fundamentals - good locations, modern amenities, and appeal to Peru's growing middle class - rather than expecting significant capital appreciation in the short term.
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.
Based on our comprehensive analysis of Peru's property market as of June 2025, the answer is: Yes - property prices in Peru are rising nominally, but the growth is modest and varies significantly by location.
While national statistics show minimal growth and even real price declines when adjusted for inflation, specific markets like Lima's prime districts and rapidly developing secondary cities are experiencing more robust appreciation. For investors and homebuyers, the key is identifying areas with strong fundamentals and growth drivers rather than expecting broad-based price increases across the country.
Sources
- Global Property Guide - Peru Price History
- TheLatinvestor - Peru Real Estate Market Statistics
- BBVA Research - Peru Economic Outlook March 2025
- Trading Economics - Peru Interest Rate
- Reuters - Peru Economy Growing 4% in 2025
- TheLatinvestor - Peru Price Forecasts
- CEIC Data - Peru Real Property Price Index
- Fitch Solutions - Peru Growth Outlook