Violence, political instability and a crumbling infrastructure do not make Caracas the easiest location for an expatriate. Its reputation as one of the most dangerous major cities in the western hemisphere – with 16 murders a day and so-called express kidnappings on the rise – is well known around the world. But, in fact, foreigners are rarely targeted and for those that are willing to take a risk and invest in property here the rewards can be high.

In the past four years, most types of residential property in the Venezuelan capital have doubled in value, spurred on by spiralling construction costs, cheap government-backed loans and strong domestic demand.

Estate agent César Aguzzi says that because relatively few foreigners posted to or otherwise living in Caracas invest in property, the market is limited and returns can outstrip other areas nearby. “If they are not put off by the red tape, investors are often dissuaded by the lack of legal certainty,” says Aguzzi. “As a result, the buy-to-let sector is rather limited, which in turn means that yields are extremely high compared to the rest of Latin America. An annual yield of approaching 10 per cent of the value of the property is not uncommon for high-end units in the best areas.”

I take a walk with Aguzzi through the office blocks and residential towers of the Sabana Grande neighbourhood, convenient for the city’s central banking district. Aguzzi insists that his home town is a city with a lot to offer foreign residents, and that money can be made from real estate.

He says the district’s landmark Solano development is a favourite with first-time buyers and that a 62 sq metre unit that sold for $b260,000 (£18,573.92) in May 2007 is now worth $b380,000.

A luxury new-build apartment with 120 metres of floor space in the sought-after Prados del Este area sells for approximately $b850,000. In prestigious Valle Arriba, meanwhile, near the US embassy and with a panoramic view of a vast swathe of the east the city, Bricks Caracas is selling a 292 sq metre penthouse with four bedrooms, four bathrooms, maid’s quarters and four covered parking spaces for $b1.9m.

As we walk around it becomes clear that as one of the continent’s oldest colonial cities, Caracas is also home to some beautiful examples of modern architecture. Among the shadows of downtown skyscrapers are South American liberator Simon Bolivar’s birthplace, the Plaza Bolivar, the elegant Casa Amarilla (Yellow House) and the 1665 Caracas Cathedral. Then there is the city’s university, designed by Carlos Raul Vilanueva, which is a United Nations Educational, Scientific and Cultural Organisation World Heritage Site. On side streets, it is also possible to find vestiges of the colonial era in the form of brick homes, remnants of Spanish masonry, and a hillside monastery.

David Palacios, a 40 year old artist who is originally from Havana in Cuba, finds inspiration in both the positive and the negative aspects of life in the Venezuelan capital.

“My main tool is my eye,” he tells me over a coffee in Los Palos Grandes, an eastern district that is home to many young diplomats and oil executives keen to be close to its eclectic range of restaurants and bars. Behind us is the magnificent green hulk of Mount Avila, all of it a national park, which lies between Caracas and the Caribbean shore.

Another resident to have found inspiration here is Sander Koenen, 36, originally from Tilburg in the Netherlands. He markets his eponymous line of chocolates to a local client base that appreciates his innovative flavours using mainly local ingredients.

“One of my truffles pays tribute to Venezuela’s long tradition of beauty queens by combining pistachio nuts, white chocolate and Special K cereal – reputedly a staple of their diet,” he says.

Home for Koenen is the district of Chacao, a residential quarter traditionally favoured by Spanish and Portuguese immigrants and something of a buffer zone between the working class west and the mainly middle- and upper-class east, of Caracas.

Year-round tropical warmth and sunshine are key attractions for Koenen. “The city’s wonderful climate makes you happy just to get up in the mornings,” he says. Most of the capital’s 6m residents live at an altitude of 900-1200 metres, which usually makes for refreshingly cool nights.

Diplomat Gaetano Viti, 36, and his wife Karen Van Hoorick, 34, also feel that there is much about Caracas expat life to be positive about, in the district of Los Palos Grandes especially.

“Quite apart from the regular sight of pairs of parrots flying past our terrace, we are lucky to live in a district that you can explore on foot,” says Viti. “And it is a particularly good area if you have young children. Within four blocks of our home there are crèche facilities in Spanish, Italian, English and French.”

Writer and broadcaster Valentina Quintero from Venezuela agrees that the most pleasant residential options in Caracas are districts such as Los Palos Grandes that preserve something of a village atmosphere, contrasting with the many newer, gated communities where anonymity is prized.

“In Los Palos Grandes middle class people still find time to chat on the street,” says Quintero. “I’ve lived here for two decades and have come to think of it as the SoHo of Caracas. Although it has become more commercial over the years, there is a definite desire here to preserve the district’s many old, characterful buildings from the post-war period, with their fine granite interiors.”

The same cannot be said for much of the rest of Caracas. A combination of stifling bureaucracy, municipal indifference and real estate speculation – fuelled by the oil boom – mean that the city’s precious patrimony of modern architecture is under greater threat than ever before.

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Estate agencies

Bricks Caracas, tel: +58 212985 3222,
www.brickscaracas.com

César Aguzzi and Associates,
cesaraguzzi@gmail.com