The Real Estate Market in Paraguay: Projections for 2025

The real estate market in Paraguay is experiencing significant expansion, establishing itself as one of the key sectors driving the country’s economic development. According to a recent report by Statista, the total value of the real estate market is expected to reach $194.42 billion in 2025, representing an increase of $6.39 billion compared to 2024. This growth is primarily driven by the dynamism of the residential market, although the commercial sector is also showing solid performance.

Residential Sector: The Growth Engine

The residential segment overwhelmingly dominates Paraguay's real estate market, with a projected value of $155.8 billionin 2025, an increase of $5.8 billion from the previous year. This growth reflects sustained demand for housing, both for purchase and rental, driven by factors such as increasing urbanization and the need for affordable housing solutions.

In terms of transactions, a significant rise in the number of residential properties sold is expected, reaching 12,170 transactions in 2025, compared to 11,090 recorded in 2024. Additionally, the average transaction value is set to rise to $97,870, marking an increase of $2,390 from the previous year. This increase not only reflects rising property values but also a shift in consumer preferences toward higher-quality housing.

Growth in Residential Rentals

The rental market is also performing well. Total rental income is projected to reach $4.69 billion in 2025, surpassing the $4.42 billion recorded in 2024. This growth is spread across both house and apartment rentals, with significant participation in both segments.

The number of rented houses will reach 381,500 properties, generating $3.91 billion in income, while apartments will account for 151,600 leased units, generating $780 million. Additionally, the average rental income per house will increase to $10,240 per property, while apartment rentals will rise to $5,170, reflecting an increase of $450 and $230, respectively.

Changes in Homeownership

The Paraguayan market is experiencing a gradual shift in ownership and rental dynamics. By 2025, it is projected that 36.8% of households will be rented, marking a steady 0.1% annual increase since 2021. Meanwhile, the percentage of owned homes will slightly decline to 63.2%, following the same annual trend.

This shift toward rentals reflects not only changing consumer preferences but also the impact of urbanization and the younger generation’s desire for flexibility. Urban areas, in particular, have seen a notable increase in rental demand, driven by migration from rural areas in search of better economic opportunities.

The Commercial Market: A Complementary Pillar

While the residential sector leads the market, the commercial real estate segment also plays a crucial role. By 2025, the commercial real estate market is expected to be valued at $38.62 billion, with an increase of $590 million compared to 2024. This growth is linked to rising investments in infrastructure, office spaces, and commercial establishments, particularly in the country’s main cities.

Long-Term Projections and Investment Opportunities

Looking ahead, Paraguay’s real estate market is projected to grow at a compound annual growth rate (CAGR) of 3.15% from 2024 to 2029, reaching an estimated value of $219.7 billion by 2029. Within this outlook, the apartment rental segment stands out for its dynamism, with a CAGR of 5.34% during the same period, bringing the market volume to $960 million.

This sustained growth is driven by multiple factors, including the country’s political stability, a favorable economic environment, and a growing young population. Additionally, the increasing popularity of real estate investment trusts (REITs) is attracting both local and international investors.

Key Factors in Market Development

The development of Paraguay’s real estate market can be attributed to a combination of macroeconomic factors and consumer trends:

Consumer Preferences: There is a growing demand for affordable housing, particularly among urban middle-class households. This has led to an increase in residential property transactions, especially in metropolitan areas.
Urbanization: Migration to cities like Asunción has generated higher demand for housing in urban areas.
Foreign Investments: Paraguay offers an attractive environment for international investors due to its economic and political stability.
Economic Growth: Rising disposable income and low interest rates have facilitated access to housing financing.

Paraguay’s real estate market is in a phase of sustained expansion, with robust growth in both residential and commercial segments. This dynamism not only benefits investors but also meets the housing needs of a growing and urbanizing population. With promising prospects for the coming years, Paraguay’s real estate sector is positioned as a fundamental pillar of the country's economic development.

Source: Statista.