The price of rents in Nicaragua has fallen to 30%, according to landlords willing to speak to the media.
One such landlord, Isabel González, told El Nuevo Diario, she has been renting three of her properties for the last four years, but in the last eight months, she has had to take measures to keep receiving that income.
González has three homes, inherited from her family, which before the social protests that started in April, rented at more than US$600 dollars each.
The houses are located in Altamira, Monseñor Lezcano and Los Robles, high-end areas of Managua. Now, Isabel is struggling to keep them rented, dropping her prices close to the US$400 mark.
Real estate companies say that rental prices have fallen least 30% because of the sociopolitical crisis that began in mid-April and continue to this day.
Realtor Enrique Cornavaca stressed that this type of area in which González rents are those that have been most affected.
“The entire southern area, Masaya road, Villa Fontana, Altamira, are part of the most affected areas because there were people with high purchasing power who now, because of the crisis, have decided to leave the country and those places have been left unoccupied,” said Cornavaca.
Low demand is the influencing factor. Experts agree that now there are few tenants to fill the the rental market and this vacuum has resulted in lower prices.
According to Gonzalez, even with lower rents, she is not able to rent two of her properties, this despite dropping US$200 on her rates.
Gonzalez said one of her tenants left because he lost his job, the other couldn’t keep up with the rent for his business plummeted due to the crisis.
Cornavaca explained that rents in the high districts of Managua would go for US$2,000 monthly for a 2,500 square meter home. Now, empty, those homes are being offered at US$1,600. But there are no takers.
The declining economy due to the crisis has led to high unemployment, which is one of the main factors for the rentals becoming empty, as people movie in with family or move to areas less expensive.
According to the Foundation for the Economic and Social Development – Fundación para el Desarrollo Económico y Social (Funides) – in the last eight months some 150,000 people have become unemployed.
Another factor is insecurity. Many left their homes for not feeling safe. Houses in areas near universities, rotondas and shopping centers have been vacated.
A landlord speaking to the El Nuevo Diaro in anonymity, who rents rooms to university students, said she has no more tenants. She said that though she dropped her prices she still cannot attract tenants. “People don’t want to live in this area that became unsade during the months violence and anti-government protests.”
Cornavaca adds that in some areas of Managua, like in the north, where there is more industry and commerce and have not been affected by the violence as much, rental prices have not fallen to the same extent as other areas.
The outlook for 2019? Not every encouracing.
According to Cornavaca and other realtors, who expect an even greater supply of rentals to hit the market and even lower prices.