On the island of Roatan off the coast of Honduras, a house known as the Casa de los Bahias is on the market for $2.2 million. The fully furnished, 11,830-square-foot house sits on top of a hill, enjoying a view of two bays.

The house's asking price reflects how the small island has developed from a scuba diving destination to a prominent tourist spot. Cruise ships stop at the island's two ports on a regular basis, and there are direct flights there from the U.S. Most buyers in Roatan are American and Canadian, though Europeans have discovered the island as well.

In 2009, the combination of political crises and the global economic downturn sent Honduran house prices plummeting. “It almost flat-lined our market,” says local broker Janine Goben. “It was a disastrous year for anyone wanting to sell.”

But since the beginning of this year, the local situation seems to have improved. The political situation has stabilized somewhat, and a warning on traveling to the Central American country has been lifted. Foreign buyers have started to come back, and places like Roatan, which are quite removed from the political problems of the mainland, are enjoying the return of foreign interest.

It's still a buyer's market, with many house prices off by 40% of their peak values, or even more.

Source: The New York Times