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House prices in Tegucigalpa are not expected to go down in the near future. The capital's property market shows strong fundamentals with rising foreign investment, government support policies, and steady demand from both local and international buyers.
Property values in Tegucigalpa have increased approximately 20-25% in real terms over the past five years, currently averaging $1,200 per square meter. With foreign direct investment nearly doubling from $920 million in 2022 to $1.8 billion in 2023, and new construction permits rising 34.5% in the same year, the market demonstrates robust growth momentum that suggests continued price appreciation rather than decline.
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Tegucigalpa's property market is experiencing steady growth with prices averaging $1,200 per square meter as of September 2025. Foreign investment has nearly doubled, construction permits increased by 34.5%, and mortgage rates are expected to decrease from current levels of 10-14%.
The combination of rising rental demand, government housing incentives, stable remittance flows, and infrastructure development positions Tegucigalpa for continued price appreciation of 3-7% annually through 2027, making property price declines unlikely in the current market environment.
| Market Indicator | Current Status (Sept 2025) | Trend Direction |
|---|---|---|
| Average Price per m² | $1,200 | Rising (3-7% annually) |
| Foreign Investment | $1.8 billion (2023) | Nearly doubled from 2022 |
| Construction Permits | +34.5% increase | Strong growth |
| Mortgage Rates | 10-14% | Expected to decrease |
| Unemployment Rate | 5.2% | Declining to 5% by end-2025 |
| Time to Sell | 2-3 months | Stable |
| Rental Yields (Airbnb) | $5,076 annual average | Rising demand |
What are the current average house prices per square meter in Tegucigalpa?
House prices in Tegucigalpa currently average $1,200 per square meter for quality residential properties as of September 2025.
This pricing reflects significant growth from previous years and positions Tegucigalpa as one of the more expensive Central American capitals. The $1,200 per square meter figure applies to well-constructed residential units in desirable neighborhoods with proper infrastructure and utilities.
Price variations exist across different areas of the city, with premium locations commanding higher rates and emerging neighborhoods offering more affordable options. Properties in central areas with better access to commercial districts, universities, and transportation hubs typically exceed this average.
Foreign buyers often face slightly higher prices due to their preference for properties that meet international standards and their willingness to pay premiums for security features and modern amenities.
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How have house prices in Tegucigalpa changed over the past five years?
House prices in Tegucigalpa have increased approximately 20-25% in real terms since 2020, significantly outpacing inflation during this period.
The average cost in 2020 ranged from $800-$900 per square meter, marking a nominal increase of 33-50% depending on location and property type. This growth accelerated particularly after 2022 due to a surge in foreign direct investment and major infrastructure projects.
The most significant price appreciation occurred between 2022 and 2024, when annual growth rates reached 6-8% in many neighborhoods. This acceleration coincided with increased international interest in Honduran real estate and government initiatives to attract foreign investment.
Property values rose about 3% in 2024 alone, demonstrating continued momentum even as the market matured. The consistent upward trajectory reflects strong underlying demand fundamentals and limited housing supply in desirable areas.
This five-year growth pattern places Tegucigalpa among the faster-growing property markets in Central America, outperforming many regional capitals in terms of price appreciation.
What are current mortgage interest rates in Honduras and where are they headed?
Mortgage interest rates in Honduras currently range from 10-14% for local residents, with higher rates typically applied to foreign buyers.
The central bank's benchmark interest rate stands at 5.75% as of September 2025, which influences the lending rates offered by commercial banks. Local banks generally add significant spreads to account for risk factors and operational costs in the Honduran market.
Interest rates are projected to decrease in the coming years, with central bank rates predicted to trend down toward 3.5% by 2026-2027. This anticipated reduction would likely translate to lower mortgage rates, potentially improving affordability for homebuyers.
Foreign buyers typically face rates at the higher end of the range due to additional documentation requirements and perceived higher lending risks. Some international banks operating in Honduras offer more competitive rates to qualified foreign applicants.
The expected downward trend in interest rates could stimulate additional demand in the housing market, potentially supporting continued price appreciation as borrowing becomes more affordable.
How many houses are currently for sale in Tegucigalpa compared to last year?
Current listings show approximately 14-31 houses available for sale in Tegucigalpa across major real estate portals, representing limited supply for a capital city.
This inventory level is consistent with a market experiencing steady demand where properties move relatively quickly. The limited number of listings indicates either strong absorption of available properties or reluctance by owners to sell in a rising market.
Listing volume remains steady to slightly up compared to the previous year, as new residential construction increases housing availability. However, the rate of new listings has not kept pace with demand, maintaining tight market conditions.
The low inventory reflects broader market dynamics where property owners prefer to hold assets in an appreciating market rather than sell. This supply constraint contributes to continued upward pressure on prices.
Major real estate portals report that quality properties in desirable locations often receive multiple inquiries within days of listing, indicating robust buyer interest despite limited options.
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What is the average time to sell a house in Tegucigalpa currently?
Houses in Tegucigalpa currently take an average of 2-3 months to sell, reflecting moderate market liquidity similar to other Latin American urban centers.
This timeframe varies significantly based on property type, location, and pricing strategy. Well-priced properties in desirable neighborhoods often sell within 4-6 weeks, while overpriced or poorly located properties may remain on the market for 4-6 months.
The 2-3 month average indicates a balanced market where buyers have some options but motivated sellers can achieve sales within reasonable timeframes. This pace has remained relatively stable over the past year despite rising prices.
Properties targeting foreign buyers or investors may take slightly longer due to additional due diligence requirements and financing complexities. However, cash buyers, both local and foreign, often complete transactions more quickly.
Real estate agents report that properly marketed properties with competitive pricing and good presentation typically generate interest within the first month of listing.
How have rental demand and prices shifted recently in Tegucigalpa?
Rental demand in Tegucigalpa is rising due to growing numbers of students, young professionals, and expanding industries like IT and tourism.
University enrollment in the city has reached all-time highs, creating consistent demand for student housing and young professional accommodations. The expanding technology sector and tourism industry also contribute to increased rental demand from domestic and international workers.
Rental prices are increasing, especially for centrally located and modern properties that meet contemporary living standards. However, new residential development is helping to stabilize rent growth by increasing overall supply in the market.
Short-term rental markets show strong performance, with Airbnb hosts averaging $5,076 in annual revenue. Median nightly rates around $48 and occupancy rates of 31-40% depending on season and property quality demonstrate viable investment returns for property owners.
The rental market benefits from both local demand and increasing tourism, creating multiple revenue streams for property investors considering rental strategies.
What is the current level of construction activity and permit issuance?
Tegucigalpa experienced a 34.5% rise in residential building permits in 2023, signaling a significant boom in new home and condominium construction.
This construction surge is driven by multiple factors including tax incentives for developers, streamlined permitting processes, and substantial foreign investment in the residential sector. The government has actively promoted construction through policy reforms and financial incentives.
Major residential projects are underway across the city, with developers focusing on both affordable housing segments and higher-end properties targeting foreign buyers and wealthy locals. Mixed-use developments combining residential and commercial spaces are particularly popular.
The permitting increase reflects confidence in the market's future performance and suggests that supply will expand to meet growing demand. However, the construction timeline means most new units won't impact the market until 2025-2026.
It's something we develop in our Honduras property pack.
What are the employment and income trends in Tegucigalpa?
Tegucigalpa's unemployment rate has declined to 5.2% in 2024 and is expected to reach 5% by the end of 2025, indicating a strengthening job market.
Average salaries rose from $600 per month in 2024 to approximately $620 per month in 2025, representing modest growth of about 3%. While this increase is moderate, it demonstrates positive momentum in the local economy.
Minimum wage increases varied by sector, rising 5.5-7% depending on the industry. These wage improvements help support housing demand by improving affordability for local buyers, though the pace of wage growth still lags behind property price appreciation.
The technology and tourism sectors are driving much of the employment growth, attracting both local talent and international workers to the city. These industries typically offer higher wages than traditional sectors, contributing to increased purchasing power among younger demographics.
Government employment also remains significant in the capital, providing stable income sources for a substantial portion of the working population.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Honduras 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.
How is inflation affecting household purchasing power and housing demand?
Annual inflation in Honduras currently runs at 4.41-4.67% as of July 2025, moderately eroding household purchasing power and potentially slowing housing demand.
This inflation rate impacts both housing costs and general living expenses, creating pressure on household budgets. However, continued salary adjustments and government support programs have softened the impact on most families.
The inflation level remains within manageable ranges compared to some regional economies, and government policies aim to maintain price stability while supporting economic growth. Central bank monetary policy focuses on controlling inflation without severely restricting economic activity.
Housing demand continues despite inflationary pressures because property is viewed as an inflation hedge. Many buyers prefer to invest in real estate rather than hold cash that loses purchasing power over time.
Foreign buyers are less affected by local inflation dynamics, and their continued interest helps sustain demand even when local purchasing power faces pressure from rising prices.
What government policies and subsidies are affecting the housing market?
The government has implemented several programs to support housing access and construction, including Executive Decree PCM 40-2024 providing targeted financial aid for homeowners.
New mortgage relief programs reduce capital reserve requirements for banks, making housing loans more accessible to thousands of families. These initiatives specifically target first-time homebuyers and middle-income households previously excluded from traditional financing.
Tax incentives and simplified permitting processes encourage developers to build more housing units, particularly in the affordable segment. These policies contributed to the 34.5% increase in construction permits and continue to drive new development.
Local governments, supported by advocacy organizations, are enacting policies to encourage affordable housing construction and improve land access for first-time buyers. These initiatives help address housing shortages in lower-income segments.
Recent tax legislation focuses on improving oversight and compliance rather than imposing new property-specific taxes, maintaining relatively favorable conditions for property ownership and investment.
How are foreign investment and remittances influencing property purchases?
Foreign direct investment in Honduras nearly doubled from $920 million in 2022 to $1.8 billion in 2023, significantly impacting the Tegucigalpa property market.
This investment surge fuels both new construction and price appreciation, particularly for higher-end properties sought by foreigners and expatriates. International buyers often focus on properties meeting international standards, driving demand in premium market segments.
Honduras remains highly dependent on remittances, which support both consumption and property investment by local families. These funds provide crucial financing for many property purchases, especially in middle-income segments.
No restrictive policies currently affect access to remittance funds for real estate purchases, maintaining this important source of market liquidity. Remittance flows remain stable and continue supporting housing demand across various price ranges.
The combination of foreign investment and remittance flows creates multiple demand sources that help sustain market growth even during periods of local economic uncertainty.
It's something we develop in our Honduras property pack.
What do experts forecast for Tegucigalpa housing prices over the next 12-24 months?
Major banks and real estate analysts expect property prices in Tegucigalpa to rise 3-5% per year through 2027, driven by ongoing strong demand from both local and foreign buyers.
Infrastructure projects and a growing, youthful population continue to drive housing demand, while supply constraints support price appreciation. The combination of limited inventory and steady demand creates favorable conditions for continued price growth.
Rental markets may stabilize as new supply increases, but overall demand remains robust across both sales and rental segments. This dual market strength supports property values and provides multiple exit strategies for investors.
Market risks include political uncertainty ahead of elections and relatively high lending rates, but these concerns are mitigated by foreign investment flows, stable currency conditions, and continued infrastructure improvements.
Barring major external shocks, the Tegucigalpa real estate market is expected to maintain a steady upward trajectory for the next 24 months, with price declines considered unlikely given current market fundamentals.
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.
The Tegucigalpa property market shows strong fundamentals that make price declines unlikely in the near term. With foreign investment nearly doubling, construction permits increasing significantly, and government policies supporting housing access, the market demonstrates robust growth momentum.
Current market conditions including limited inventory, steady demand, declining unemployment, and expected interest rate reductions create an environment favorable for continued price appreciation rather than decline. Investors and homebuyers can expect continued growth in the 3-7% annual range through 2027.
Sources
- The LatinVestor - Honduras Buy Property
- The LatinVestor - Tegucigalpa Price Forecasts
- Trading Economics - Honduras Interest Rate
- Trading Economics - Honduras Lending Interest Rate
- Fazwaz - Houses for Sale Tegucigalpa
- AirROI - Tegucigalpa Report
- The LatinVestor - Honduras Real Estate Trends
- The LatinVestor - Honduras Real Estate Forecasts
- Trading Economics - Honduras Unemployment Rate
- Trading Economics - Honduras Inflation CPI