From where we sit, 2018 was a very good year by almost every measure! It might have been an amazingly good year if we didn’t hit a speed bump in November and December. But more on that later.
On the South Shore we have seen several high-end water-front properties up to $3M go under contract and the latest Sierra del Mar Los Arcos development ‘Arco Playa’ sell extremely well with only 2 units remaining for June 2019 delivery. At the same time our newly renovated Olas Altas Office has seen most of the 15 new buildings in the Romantic Zone that were started in 2017 completed with most virtually sold out. For the first time in over 20 years there are now 3 separate cranes over three different condominium projects under construction in the Marina. The Flamingos extension of Nuevo Vallarta has three different waterfront condo projects including the amazing Bellarena project underway and in the process of selling well by all reports. Further North we are seeing continued strong activity out of our Punta Mita Office and our Rincon de Guayabitos Office reports that the La Mandarina Resort featuring a One And Only Resort and the El Capomo Resort just announcing the addition of a Ritz Carlton Reserve Hotel – are both well under-way.
Year on year comparisons are all up both in houses and condominiums. For houses there were 255 sold in ’18 vs 205 sold in ’17 which represents a 24.4% increase in number of houses sold. The Average Sale Price was $396,789 in ’18 vs $360,582 in ’17 which represents a 10% increase in the average sale value of a house sold in 2018 as compared to 2017. Both these numbers represent solid gains in the single family housing market for the Puerto Vallarta/Riviera Nayarit areas. The absorption rate – the time that it would take for the market to ‘absorb’ 100% of the market inventory of condominiums based upon the rate of sale at the end of 2018 – has also fallen from about 32 months to 20 months.
For Condos we had 819 reported sales in ’18 vs 727 sales in ’17 – a gain of 12.7% while the average price of a condominium sold was $281,726 in 2018 vs a sale price of $270,666, a gain in the average price of a condominium of 4.09%. Another very positive for the condo market is that the absorption rate has fallen to just under 13 months from 17 months at the end of 2017.
Unfortunately, markets rarely sustain themselves in straight lines and the bump I referred to earlier started to occur late October 2018 and lasted through to the end of the year. In both houses and condominiums sales were off significantly in both November and December. For these 2 months compared to 2017, house sales were off some 45% in 2018 and condominium sales were off about 20% for the same two months. Our feeling is that this deterioration occurred due to two factors. One was the general preoccupation with the US Midterm Elections which took place of course on November 6, 2018. The second factor which occurred from the end of November through December was the wild gyrations and eventual losses that took place in the world stock markets, led by those in the US.
So, where do we go from here? While caution certainly seems to be the order of the day we feel that given the general strength of the world economy and the strong levels of employment that there is basis for optimism going forward – especially when it comes to our area. Stability on the world trade front and a less aggressive stance from the US Federal Reserve would definitely be a plus. The thing that won’t change is the continued desire for people in Canada, the US and other parts of Mexico to locate themselves in a picturesque, secure and thriving community in a warm mild climate right next to the sea! That will not change!
Please contact us at any one of our four offices throughout the Bay for more details and discuss your next move with one of our skilled agents or our web-site www.cblacosta.com