A realistic look at Medellin real estate prices

Medellin real estate prices

This is an important topic that I thought would make an interesting post, especially for those unfamiliar with Medellin real estate and the city’s different zones or sectors. Like in any real estate market, prices for homes and apartments in Medellin are most often determined by one thing (or is it three?), location, location, location! Medellin is officially divided into 6 different zones or stratas. The government uses these divisions as a way to decide what to charge residents for electricity. Generally, the higher the zone number, the nicer the zone and the more the government charges residents in that zone for electricity per kilowatt hour. This has proven to be an excellent way for the residents of nicer areas like Poblado to essentially subsidize the electricity usage for those who live in the poorer barrios of Medellin.

Medellin neighborhoods and zones

Though the 6-sector division works well for the municipality, for the purposes of real estae, we have found it easier to divide the city into four zones and, in this case, the higher zone numbers do not necessarily correlate to a nicer neighborhood. Prices in Medellin have been rising steadily for the past several years. It is hard to say what effect foreign investors and home buyers have had on real estate prices in Medellin, but my assumption is not much. Most of the price appreciation witnessed in Medellin has been driven by the stability in the local economy, a growing middle-class and Colombian-expats living abroad and investing in Colombia. Over the last several weeks, I have compiled a list of the average price per square meter for apartments in Medellin’s main neighborhoods. My calculations are based on the asking prices of well over 100 apartments in neighborhoods from all four real estate sectors.

Here is what we found.

The lack of a Multiple Listing Service in Colombia makes it difficult to obtain precise real estate sales information. Nonetheless, data was compiled on more than 100 different apartments in Medellin and are accurate through September 2009. Avid followers of Medellin real estate and Internet sites dedicated to the promotion of Medellin as a travel and investment destination will notice that these results differ greatly from those posted on other, more outdated sites. I have found these results to be right on the mark, and that they accurately reflect today’s real estate market in Medellin. Long gone are the days where one can find a nice apartment in Poblado for $60/sqft. Almost every apartment that we surveyed in Poblado was above $100/sqft. I will highlight each one of these sectors in my next few posts. Stay tuned!