Why Panama?

Panama Real Estate

It is no secret that Panama real estate has become sought after beach property given its location, natural beauty and strong economic outlook. Within the Central American region, Panama real estate outperforms in so many ways Costa Rica, Honduras, Nicaragua, and Colombia. Visitors that take a Panama Vacation can enjoy cosmopolitan Panama City, colonial era ruins, expansive white sand beaches in Bocas Del Toro, cool mountain highlands, tour the Panama Canal and pristine rainforest ecosystems. Those looking to capitalize on Panama's long-term growth prospects are taking advantage of current Panama real estate investment opportunities. Foreign investors wanting to buy Panama real estate have the same rights as Panamanians and property is generally titled. Title insurance can be purchased and traditional mortgages are readily available through sophisticated international banks.

Something that is making Panama Real Estate and its beach property so attractive is that it continues to develop as not only a vacation destination but also as an attractive destination for retirees and investors, similar to what Costa Rica has already experienced. A comprehensive incentive program for retirees is available and many retirees are taking advantage of the lower cost of living and year round average temperatures of about 80 degrees. For foreign investors looking at Panama real estate, the US dollar based economy, Free Trade Zone, and international banking center are all attributes to consider. Major banks such as HSBC, Scotia Bank and Citibank all have established franchises in Panama. It is frequently said that Panama has aspirations to be the "Singapore" of the region and with its inherent assets, location, economic and political stability, Panama Real Estate is likely to be a terrific investment for long-term investors.

"Panama is now where Costa Rica was ten years ago."

  • Panama is a democratic nation. Its political stability combined with a healthy, growing economy helps makes the country tops on many lists as a retirement destination, a haven for capital and as a place to start a business.
  • All foreign and national investors who buy Panama real estate are guaranteed equal rights by law.
  • Panama Real Estate is beautiful. This extraordinarily beautiful country offers a wide variety of residential venues. You can take a Panama Vacation that includes mountain, beach and city communities, and will please visitors of all tastes.
  • Panama is modern. The cosmopolitan capital city, Panama City, with high-speed Internet, first rate hotels and restaurants and shopping, is almost on a par with the US. Panama has a reliable communications and road infrastructure due in part to the 90-year American presence in Panama.
  • Panama is incredibly affordable. The cost of living is a fraction of that in the United States.
  • Panama's currency is the US dollar.
  • Panama has a near perfect climate-Yearly average temperature: 27 Centigrade or 82 degrees Fahrenheit. Rainy seasons from May to August and from November to January. Dry seasons from February to April and September and October.
  • Panama is retiree-friendly. Panama has one of the best retiree incentive programs in the world.
  • Panama has medical facilities on par with the United States. The Johns Hopkins affiliated hospital in Panama City is the only one of its kind in the region.
  • Panama is relatively close to many major US cities and has an increasing number of direct flights from major European cities.
  • Retirement visa requirements are minimal for those that own Panama real estate.
  • Foreigners can buy and Panama real estate and enjoy the same rights and protections as Panamanians.
  • Panama City is one of Central America's most modern cities. Luxury hotels, fine restaurants, and a very cosmopolitan nightlife.
  • Panama City is the banking center for much of Central and South America.
  • Panama has a tropical climate that is essentially free of natural disasters. There are no hurricanes or tornadoes and it is not substantially plagued by earthquakes like many of its Central American neighbors.

One of the best places to retire in the world

Panama also offers the world's best resident retiree program. If you're looking to retire, Panama should be at the top of your list. The Annual Global Retirement Index has given top honors to Panama.

1st world infrastructure, 3rd world prices

Panama has almost everything: year-round sun, low taxes, massive discounts for seniors, first-world amenities, quality private hospitals, bird-filled rainforests, a dollar economy and easy flights from the U.S. Panama City is considered safest of all Central American cities, with worldly buzz because of the canal, and a World Heritage Site. Forbes - The Best Retirement Havens, Oct 2009

1st world infrastructure, 3rd world prices

Panama City is becoming a "first world" hub in the region. On economic, social and cultural fronts this city is making great strides as it evolves into a fully developed first world metropolis. This cosmopolitan city is also making advances to become a global leader in trade, commerce and tourism. Most visitors are surprised to see the renovated Tocumen International Airport (PTY), a modern skyline, upscale shops and boutiques, and a vibrant social scene. Panama real estate has a lot to offer because of because of the modernization of the country.

If you are looking for privacy, sanctuary, and serenity, you can find great deals in Panama Real Estate. Panama is one of the world's premier retirement destinations. In addition, property and services in Panama are extremely affordable. Panama Real Estate and services are generally priced far below "first world markets."

Weather: Beautiful, Temperate and No Hurricanes

Boaters will be glad to know that Panama lies below the hurricane belt, though occasionally a weak tropical depression will skirt the Caribbean coast. The high season is mid December-mid April, when it rains the least. Nonetheless, Panama, except for the highlands, is nearly always hot and humid (days in the 80s-90s F/28-37 C and nights not much cooler). With the aid of air-conditioning and sea breezes, Panama can be enjoyed all year, though it can rain as much as an inch a day during the May-November rainy season.

Panama is unique in that it offers several different "flavors" of paradise. For such a small country Panama is blessed with the aquamarine waters and islands of Bocas Del Toro, a network of national parks featuring ample tracts of primary rainforests and charming highland villages that feature soaring mountain ranges that offer cooling respite from the heat of the tropics.

Tax Advantages

Any property in Panama with a registered value of $30,000 is not subject to property tax. Owners of property of a higher value are liable for property taxes. This tax will be under Normal Tariff (article 766 of the Tax Code) and Preferential Tariff or TPCA (article 766-A of the Tax Code). The application of either tariff will depend on the specific status of the property. In case of a Normal Tariff the tax applicable is as follows: $30,000 to $50,000, 1.75%; 50,000 to 75,000, 1.95%; more than 75,000, 2.10%. In case of Preferential Tariff the tax applicable will be as follows: for the $30,000 to $50,000 bracket, .70%; for the difference between 50,000 to 75,000, .90%; more than 75,000, 1.00%. And, of course, it is always best to get appropriate tax advice from a qualified Panamanian professional in every case.

The property improvements will not be subject of taxation under the following circumstances: For properties that had the construction permit before September 1, 2006, there will be a 20 year exoneration.

For properties that got the construction permit after September 1, 2006, it will be the following:

  1. up to $100,000 - 15 years
  2. more than $100,000 up to $250,000 - 10 years
  3. more than $250,000 - 5 years

If the properties get the construction permit before July 1, 2009 and their improvements are duly registered in the Panamanian Public Registry before December 31, 2011, the exoneration will be for 20 years.

These exonerations will take place either at the registration of the improvements or at the issuance of the occupation permit, whichever occurs first.

Please check with Panama Governmental Authorities for more details and any changes to these current property and tax incentives.

Retirement Programs

Without a doubt, Panama's "law for pensioned or retired persons" is the best deal going for retirees the world over. Retire in paradise.

Qualifying for the Pensionado visa is relatively simple. You must:

  1. Be in good health and free of AIDS (blood test at a local lab costs $25 and doctor's exam is $10)
  2. Have an up-to-date passport from your country of residence
  3. Have a verifiable minimum monthly retirement income or pension of $500 from a government or private company fund. For dependents (such as a spouse or children), you must show an additional $100 of income per month for each
  4. If you do not meet the monthly pension requirement, you can instead deposit $200,000 in the National Bank of Panama. The interest from this account is proof to the government that you will be guaranteed a steady monthly income. You will have no problem withdrawing these funds should you decide to leave the country permanently.
  5. Have a clear police record for the past five years.

Once you qualify, you get significant discounts on just about everything in Panama, from doctor's visits to transportation, restaurant tabs to utility bills.

Some benefits of being a retiree in Panama:

  • 50% off entertainment anywhere in the country (movies, theatres, concerts, sporting events, etc.)
  • 30% off bus, boat, and train fares
  • 25% off airline tickets
  • 50% off hotel accommodations (M through Th)
  • 30% off hotels from Friday through Saturday
  • 25% off restaurants
  • 15% off fast food restaurants
  • 15% off hospital bills (if no insurance applies)
  • 20% off prescription medications
  • 20% off doctor's consultations
  • 15% off dental and eye exams
  • 20% off professional and technical services
  • 50% off closing costs for home loans
  • 25% off electric bills up to 600KW h
  • 25% off water bills up to $30 per month
  • 25% off phone bills on first residential line

Immigration Programs

Panama is a country full of opportunity with numerous tax and legal incentives for local and foreign Panama real estate investment. It is a nation with great stability, a strong banking system and is home to international "mega" projects like the Panama Canal expansion. These advantages, and being the leader in Central and South American GDP growth in the past two years (Statistics provided by "The Economist"), makes Panama real estate a place for investors and for those that wish to make Panama a primary or secondary residence.

As a result of Panama's dynamism, there has been an increase in the number of foreigners coming to this country to take an extended Panama Vacation (investors, tourists and retirees of other countries). Because of this immigration phenomenon the Panamanian Government has approved a new law of immigration. This is Law No 3 of February 22, 2008, duly regulated by Executive Decree No 320 of August 8, 2008. Through these new regulations, different immigration categories were included, each one with its own requisites. This change has brought more legal certainty due to the clear rules which should help to avoid free interpretation of the requests presented to the National Service of Immigration. Click Here to read more

History of Panama

Panama's history begins in the mists of pre-Columbian times among the Kuna Indians of San Blas. Here, on a shining archipelago where there are more islands than there are days in a year, the Kunas still make their colorful Molas. The first signs of human settlement in Panama are thought to be about 10,000 years old. Six different Native American cultures can be identified today: The three largest are the Embera Indians of the Darien jungle area, the Kuna of the San Blas Islands, and the Guaymi Indians of the western provinces of Chiriqui and Bocas Del Toro.

Spaniard Rodrigo de Bastidas sailed along the Caribbean coast of Panama in 1501 and Columbus arrived in 1502. Despite dropping anchor in what is now the mouth of the Panama Canal on the Caribbean side, he never realized how close he was to the Pacific Ocean. In 1513, Juan de Balboa landed in the area, hiked across the Darien jungle and became the first European to see the Pacific.

The Spanish used Panama as the trans-shipment point for treasure and goods being sent between the West Coast of South America and Spain. As a result, buccaneers desiring Spanish loot set their sights on the area. By the 1700's pirate attacks made it too dangerous to continue using the route and ships started sailing around Cape Horn. Panama went into decline.

In 1821 Panama declared its independence from Spain and joined with Venezuela, Ecuador and Colombia to form Gran Colombia. When that union split up Panama remained a part of neighboring Colombia. The California gold rush of the mid 1800s brought unprecedented traffic across the Panamanian isthmus. Once on the Pacific side, prospectors would take boats up the coast to the goldfields, a far easier journey than crossing the U.S. by land.

In the 1880's a French company began constructing a canal across the isthmus, but after losing 22,000 workers to disease and seeing investors go bankrupt, it sold the rights to the U.S. However, the Colombian government refused the U.S. permission to build which set the stage for Panama's split from Colombia. In 1903 revolutionaries on the isthmus, backed by the U.S., declared Panama an independent country and defeated Colombia's attempts to retake the territory. These actions cleared the way for the U.S. construction of the canal which was completed in 1914.

The U.S. presence in Panama continued after the completion of the canal. In addition to stationing troops in the country to protect the waterway, the U.S. frequently intervened to influence political events there. On 31 December 1999, the U.S. relinquished control of the canal to Panama.

Panama's counternarcotics cooperation has been excellent and the Panamanian Government has expanded money-laundering legislation and concluded with the U.S. a Counternarcotics Maritime Agreement and a Stolen Vehicles Agreement. In the economic investment arena the Panamanian Government has been very successful in the enforcement of intellectual property rights and has concluded with the U.S. a very important Bilateral Investment Treaty Amendment and an agreement with the Overseas Private Investment Corporation (OPIC). The current administration has been very supportive of the United States in combating international terrorism.

The Panama Canal is undergoing a major expansion to allow even larger ships and more traffic through its locks to maintain its leadership status in the coming decades. The world has taken more and more notice of Panama property since.

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