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Many individuals dream about residing within the tropics. Folks think about a spot the place the climate is all the time heat. When contemplating the tropics, Costa Rica is commonly excessive on individuals’s lists, as are the Leeward Islands of the West Indies. Different individuals would possibly think about Hawaii, the Mexican Baja peninsula, or much more unique islands of the South Pacific. Nonetheless, the actual property market in Panama is a hidden gem proper in our personal Western Hemisphere.
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Panama actual property has been on an upward trajectory for a number of years. A number of Fortune 500 corporations have regional headquarters within the nation. Luxurious resorts and residing areas are popping up on the Caribbean and Pacific coasts. Panama presents distinctive worth propositions that no different tropical nation can match.
The Panama Canal provides a gradual inflow of worldwide money movement. Panama has political and financial stability, making it a wise place for Realtors to direct their purchasers to speculate. In reality, so many high-end traders worth Panama proper now Realtors and actual property brokers ought to do their due diligence to be taught what’s attracting all this worldwide funding.
Earlier than discussing how Realtors and brokers can help their purchasers in making the most of Panama’s particular benefits, let’s study some onerous numbers that ought to pique the curiosity of patrons and, subsequently, additionally pique the curiosity of their actual property brokers.
Panama by the numbers
- 4.4 million: Panama’s present inhabitants.
- $1.5 billion: Annual overseas direct funding flowing into Panama.
- 80 flights: The typical variety of every day direct worldwide flights to Panama Metropolis’s Tocumen Worldwide Airport.
- 19 North American cities: The variety of cities within the U.S. (17) and Canada (2) with direct flights to Panama.
- 2 years: The utmost time you’ll be able to spend outdoors Panama with out shedding your visa.
- 0 % tax: In Panama, expatriates profit from a 0 % earnings tax price on foreign-earned earnings as a result of nation’s territorial tax system, which solely taxes earnings generated inside Panama.
Proceed studying to get somewhat extra into the numbers above, in addition to different the reason why Panama is the perfect vacation spot for actual property funding.
An rising luxurious market
International funding is essential to the Panama actual property market. Mockingly, Panama’s constructing growth began in 2006 with two finally canceled tasks. The Palacio de la Bahia was the primary proposed skyscraper in Panama Metropolis. After that, the Ice Tower was to be a 104-story constructing on Panama Metropolis’s seafront on Balboa Avenue. Whereas builders didn’t end these tasks, they caught the eyes of American traders who noticed the potential for funding alternatives in Panama. These traders later constructed and opened a luxurious lodge in 2011.
Not lengthy after development for that undertaking started, Spanish traders began planning a undertaking on Balboa Avenue. By the 2010s, Panama’s banks had been providing extremely favorable mortgage phrases. Infrastructure tasks modernized the nation, which had grow to be a scorching retiree vacation spot. The strategic location and simple immigration legal guidelines welcome foreigners to speculate and transfer into the nation. Mix that with its secure financial system and political tradition, and you’ve got a pretty setting for funding.
As an actual property agent, you would possibly ask your self why you need to care about that. It’s best to care as a result of when you have purchasers all in favour of investing in luxurious actual property or retiring overseas, you need to direct them to Panama. It’s the most effective and most well-rounded nation by which to put money into Central America. In case your purchasers are all in favour of being profitable in actual property, Panama has a historical past of welcoming worldwide funding, they usually plan to proceed supporting it.
Panama is probably the most trendy nation in Central America, however not the one nation receiving outdoors funding. Neighboring Costa Rica has been a goal for overseas funding for for much longer than Panama has. Nonetheless, Costa Rica has gone in a a lot completely different route than Panama. You may click on right here for an in-depth evaluate from somebody who has lived in each locations.
There are real variations between Costa Rica and Panama concerning the price of residing, infrastructure and modernization. Costa Rica tends to be costlier than Panama, and the expat neighborhood in Costa Rica is extra established.
Nonetheless, they’ve but to do as a lot to modernize their infrastructure. Costa Rica is a good place for individuals who choose outside residing. Panama’s city life is extra vibrant, with higher buying and facilities.
However what units Panama aside from its Latin American friends concerning progress and funding? A number of elements set up Panama because the go-to spot to direct your purchasers in Latin America.
Financial stability and progress
Panama makes use of the U.S. greenback as its foreign money in order that traders from the USA can really feel safe of their investments. Costa Rica is one other standard funding vacation spot, however the nation makes use of its personal foreign money. The Costa Rican colón typically fluctuates wildly towards the greenback. With Panama utilizing the greenback, traders can have extra confidence and fear much less about change charges.
One other profit is how far the greenback stretches in Panama. As a result of dimension of Panama’s financial system, the greenback goes additional, permitting individuals to get extra for his or her cash. Advising your purchasers to put money into related properties in Miami, Los Angeles, or New York can be rather more costly than in Panama Metropolis and provide them a lot smaller returns. An opulent life-style in Panama is extra attainable. Panama additionally constantly ranks within the high 10 “Best Countries for Business” for these purchasers investing for enterprise functions.
Political stability
The Panamanian authorities additionally understands the function of overseas funding in its financial well being. In consequence, it has enacted long-standing insurance policies favorable for worldwide funding and overseas possession of corporations and property. Panama additionally has favorable tax legal guidelines for individuals who stay in Panama however conduct enterprise outdoors the nation. The latest election in Panama has traders optimistic that the insurance policies that burgeoned this financial progress will proceed.
Infrastructure
What actually separates Panama from its neighbors, together with Costa Rica, is its infrastructure. Panama’s infrastructure is as trendy as virtually wherever else on the earth. The nation has paved roads, good drainage to stop flooding and quick web connections.
Individuals who attempt residing with out these items, as they could in Costa Rica and Panama’s different neighbors, typically be taught shortly to by no means take them without any consideration once more. Dwelling in Panama’s cities is much like residing in any U.S. or European metropolis.
Enterprise alternatives
Panama’s financial and political stability offers a world-class enterprise ambiance. It isn’t a third-world nation relating to enterprise. The Panama Canal performs a giant function, and Panama has the world’s second-largest free commerce zone. Nonetheless, the canal isn’t the one motive Panama attracts billions of {dollars} in direct overseas funding.
Panama is a tax haven for a lot of companies and people. Many Fortune 500 corporations have regional headquarters in Panama Metropolis. They arrive as a result of the nation levies no earnings, company, capital beneficial properties or property taxes on earnings made outdoors the nation. Revenue made within the nation is topic to taxation, however worldwide earnings is tax-free. Meaning you’ll be able to reinvest within the firm or different ventures.
Panama has additionally lengthy been a haven for retirees and a spot to direct purchasers searching for a novel place to retire the place their retirement financial savings will stretch farther to swimsuit our longer life expectations.
Quick access
Do you know flying from Houston to Panama Metropolis takes the identical time as from Los Angeles to New York? Panama is on the backside of Central America. Nonetheless, it is extremely accessible from many areas within the U.S. Seventeen cities within the U.S. have direct flights to Panama, together with Miami, Los Angeles, Tampa, Denver, and Washington, D.C. Our buddies from Canada who’re flying out of Toronto and Montreal can even take pleasure in continuous flights to Panama Metropolis.
This accessibility simplifies doing enterprise in Panama and makes it simpler for retirees and others relocating to Panama to justify the transfer. They know they’re solely a aircraft trip away from family and friends again within the States, which is a terrific promoting level for buying actual property in Panama.
Tourism and life-style
Panama has lengthy been a vacation spot for vacationers and retirees. Panama’s use of the U.S. greenback and smaller financial system have many advantages. For vacationers and retirees, luxurious actual property is extra inexpensive than in different markets. An individual who spends $6,600 month-to-month in Orlando would solely want $4,100 to stay in Panama Metropolis. That’s an enormous distinction that provides up over time.
Your purchasers can even put money into luxurious resorts in Panama. The nation is the proper possibility for individuals who need their trip {dollars} to stretch additional. That’s why many resorts are opening on each coasts and in Panama’s jungle and mountain areas.
The wealthy and well-known have additionally found Panama. Folks not too long ago noticed Mark Zuckerberg’s luxurious yacht in Panama. Chris Hemsworth not too long ago visited the Stem Cell Institute in Panama to study their cutting-edge work in regenerative drugs. Mel Gibson, Brad Pitt, Arnold Schwarzenegger, Mick Jagger, Paris Hilton and Daniel Craig have all bought property in Panama, which is also a promoting level on your purchasers.
Panama has white sandy seashores, rugged mountain terrain and plush jungles. Relying on what they’re searching for, encouraging your purchasers to purchase actual property in Panama places them on a path to straightforward residing or luck of their funding portfolios. The funding alternatives in Panama are as various as its setting. The expat communities are heat and welcoming.
Panama presents distinctive worth propositions unmatched in Costa Rica or some other tropical nation. The enduring Panama Canal is likely one of the seven wonders of the trendy world. The U.S. greenback drives the Panamanian financial system, simplifying the transition from the U.S. Panama, which is the largest banking heart in Central America.
It additionally has entry to each the Atlantic and Pacific oceans. Panama presents the perfect mix of modernity and custom with its pure magnificence, non-public islands and seashores, trendy facilities, the historic Casco Viejo (a UNESCO World Heritage web site), and the primary man-made island within the Pacific.
Panama presents a lot by way of funding alternative and top quality of life that it is a perfect and profitable panorama for retirees, traders, digital nomads, or anybody trying to put down roots on this rising and affluent nation. As an actual property agent, you owe it to your purchasers to discover this burgeoning market and assist them discover their model of paradise.
Victoria Levitam is the Managing Companion at The Company Panama and CEO of Pars Realty.
