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HGQ2112
Joined 2009
Posts: 1640

Real Estate Report - Punta Blanca

12 years ago

I generally release extremely condensed excerpts from real estate country analysis reports on July 1, 2012, for public consumption. This year, business matters and various personal matters have kept me from being punctual. Utilizing the better late than never theory, I offer them as segmented summaries, with each city having its own thread. I wanted to present them in one Ecuador thread, but it would be huge. Frankly, many people won’t even read them and those that do will likely want to focus on one or two cities. I would say that this format will cause folks to have to “hunt and peck” for data, but I still deemed it the lesser of two evils.

This data is presented only for those who have an interest in their real estate purchase, also being an investment asset. For those just looking to buy a pretty house, no point in reading further. The perspectives shared are not for every buyer. Some have different motivations for their purchase, besides sound investing, and those perspectives should be equally respected.

We have a simple system for rating a locale:

Sell - We recommend selling your asset or portfolio as quickly as possible.
Hold - If you have bought already, hang onto the asset and wait for further market developments. If you have not bought already, then do not buy now, but perhaps begin to look around for future opportunities.
Buy - Means that it is a good time to acquire an initial or additional real estate asset in that sub-market, due to favorable long-term market trends.
Strong Buy - Means that an exceptional market opportunity exists and that the time is right for the immediate consideration of an initial or additional real estate asset acquisition in this sub-market. For those looking at portfolio diversity, spreading assets across “strong buy” markets is advised, prior to focusing on “buy” markets, if investment opportunities is your sole or primary reason for purchasing real estate.

We also employ two trending systems. The first is an upward mobility and downward mobility system intended to dictate if this property market is in an upswing or downswing from the last time we reported on it. Upswing markets will be denoted by an ? and downswing markets by a ?.

Also, we place certain markets “on watch”. This is neither a necessarily good or bad thing, but a caution that a pending review to upgrade or downgrade the market is imminent. We try our best to project whether that review is likely to be positive or negative, but some market dynamics are so complex that this projection is not always 100% accurate. it should be used for guidance and not as statements of certainty.

Without further delay...here is data for the market you selected to view:

Punta Blanca Strong Buy / On Watch
Whether your view is of a glass half-full or half-empty, Punta Blanca shares much of its fate, for now, with nearby Salinas. Let us be candid, few come to Punta Blanca as an end game destination. Most use it as a sleepy, secluded and quiet “bedroom community”, where one retires after a day and, usually, a night in Salinas. Until, Punta Blanca further develops, its fate is tied largely to the tourism generated by Salinas. As such, with Salinas going “on watch” for a possible downgrade in 2013, Punta Blanca shares the same fate, for the same reasons already identified in the Salinas summary. In short, the much vaunted Salinas International Airport must go from legend to reality, with at least a concrete, quantifiable time frame for the build out of the commercial terminal. Likewise, the Province of Santa Elena has to create a cohesive plan for enhancing employment and reducing poverty. This latter point resonating particularly in contrast to Punta Blanca, which has real estate prices that rival or exceed Salinas proper, and has a reputation for being the bedroom community of many of Ecuador’s wealthy elite. While this is no doubt that Punta Blanca will continue to appeal to those that want the excitement of Salinas, but at a modest distance, while being able to enjoy a beach that surpasses anything Salinas can offer, the current level of economic development in Punta Blanca does not allow it to distance itself from the reliance on Salinas tourism. Ultimately, for now, it will suffer or enjoy the same fate.

Item of Note: While this was mentioned earlier in the year to existing consulting services clients, it is good to report that the anticipated DeCameron Resort did, in fact, open a Royal DeCameron destination, at the Punta Centinela project site. The facility is beautiful, like all DeCameron operations and will drive tourism into the region, literally, by the bus loads. While exciting, it remains to be seen if it will have any positive impact on the local economy, given the all-inclusive nature of DeCameron Resorts and the penchant for its guests to seldom have reason to leave the premises. Still, it is a step in the right direction, if Punta Blanca is ever to step away from the long shadow cast by Salinas. I have no business relationship with or receive any compensation from the folks at DeCameron.

Hector G. Quintana
[email protected]
In a time of universal deceit, telling the truth is a revolutionary act. -- George Orwell, “1984”

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