A Charming Colonial City Where You Can Still Pick Up a Bargain

In January, I stepped out from the front doors of my colonial hotel into the already bright morning sunshine. Past perfectly preserved colonial buildings, a wide central park, lined with vendors selling cool drinks and snacks, and horse-drawn carriages offering rides to waiting tourists. It was just a few more steps—past a colorful Spanish colonial cathedral—to get a fresh-brewed coffee or a gelado. You can buy fresh-baked pastries or gourmet jellies or sauces in little street-side cafes.

This is a typical scene in Granada, Nicaragua. The country’s best-known colonial city, it teems with life and a laidback-energy from morning until evening. When the sun’s out, you can take a day trip to a volcano, on the freshwater lake, or just browse in the boutique shops along the city’s main thoroughfare. By night, you can sit on the terrace of a restaurant or bar serving Italian, American, and Nicaraguan fare, and watch street performers.

It’s a fun city with a growing tourist market—but it’s still charming and old-school Latin America. People sit in the courtyards of the colonial homes their families have owned for generations, watching people stroll by outside their front gate. They’re likely to give you a friendly “hola” as you pass. And those horse-drawn carriages aren’t just for tourists. You’ll see horses clopping down the street pulling carts loaded with wood or other materials.

I’ve been visiting Granada for more than 12 years—and it hasn’t been for the sake of vacation. I’ve been there to check out the local real estate market…and to track its evolution into a vacationer hotspot.

The Nicaraguan government has focused heavily on developing its tourism sector over the past decade. It’s taken some lessons from its neighbor, Costa Rica. Granada is proof of how those efforts have paid off. With every visit I take there, I see its improvement. A new restaurant here…or a row of renovated colonials there.

But though its tourist industry has grown, its real estate prices haven’t caught up to Costa Rica’s. In fact, if you’re looking to own a colonial home, Nicaragua is a place where you can still pick up a bargain—especially relative to other colonial cities in Latin America.

On a previous trip, I found “fixer upper” colonial homes of 2,000 to 2,500 square feet in the historic district for as little as $80,000. More turnkey colonials were going for $160,000. Prices have risen since that trip in 2013—but you can still find a bargain on colonials in Granada today.

The cheapest ones still go for under $100,000—but they tend to be snapped up quickly. Blink and you’ll miss them. But for under $200,000, you’ll find a lot of options for beautiful restored colonials. Often with a spacious courtyard and pool.

Some could be renovated into small hotels…or guesthouses. There’s a good market here for colonial-style, short-term rentals. When I visited on two separate occasions in January, I struggled to find one to stay in. All the nice rentals I saw were fully booked at $150 a night.

Or, you could just own one for your own enjoyment.

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