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Many individuals dream about dwelling within the tropics. Folks think about a spot the place the climate is all the time heat. When contemplating the tropics, Costa Rica is usually excessive on folks’s lists, as are the Leeward Islands of the West Indies. Different folks may 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 dwelling areas are popping up on the Caribbean and Pacific coasts. Panama provides distinctive worth propositions that no different tropical nation can match.
The Panama Canal provides a gentle inflow of worldwide money movement. Panama has political and financial stability, making it a sensible place for Realtors to direct their shoppers to speculate. In reality, so many high-end buyers worth Panama proper now Realtors and actual property brokers ought to do their due diligence to study what’s attracting all this worldwide funding.
Earlier than discussing how Realtors and brokers can help their shoppers in benefiting from Panama’s particular benefits, let’s look at some onerous numbers that ought to pique the curiosity of consumers and, due to this fact, additionally pique the curiosity of their actual property brokers.
Panama by the numbers
4.4 million: Panama’s present inhabitants.
$1.5 billion: Annual international 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 may spend exterior Panama with out dropping your visa.
0 p.c tax: In Panama, expatriates profit from a 0 p.c revenue tax fee on foreign-earned revenue as a result of nation’s territorial tax system, which solely taxes revenue generated inside Panama.
Proceed studying to get slightly extra into the numbers above, in addition to different explanation why Panama is the best vacation spot for actual property funding.
An rising luxurious market
International funding is important to the Panama actual property market. Paradoxically, 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 buyers who noticed the potential for funding alternatives in Panama. These buyers later constructed and opened a luxurious lodge in 2011.
Not lengthy after building for that mission started, Spanish buyers began planning a mission on Balboa Avenue. By the 2010s, Panama’s banks have been providing extremely favorable mortgage phrases. Infrastructure tasks modernized the nation, which had turn into a scorching retiree vacation spot. The strategic location and straightforward immigration legal guidelines welcome foreigners to speculate and transfer into the nation. Mix that with its secure economic system and political tradition, and you’ve got a lovely setting for funding.
As an actual property agent, you may ask your self why it’s best to care about that. You must care as a result of when you have shoppers focused on investing in luxurious actual property or retiring overseas, it’s best to direct them to Panama. It’s the very best and most well-rounded nation during which to put money into Central America. In case your shoppers are focused on earning profits 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 exterior funding. Neighboring Costa Rica has been a goal for international funding for for much longer than Panama has. Nonetheless, Costa Rica has gone in a a lot completely different path than Panama. You’ll be able to click on right here for an in-depth assessment from somebody who has lived in each locations.
There are real variations between Costa Rica and Panama relating to the price of dwelling, infrastructure and modernization. Costa Rica tends to be costlier than Panama, and the expat group 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 favor out of doors dwelling. Panama’s city life is extra vibrant, with higher buying and facilities.
However what units Panama aside from its Latin American friends relating to progress and funding? A number of elements set up Panama because the go-to spot to direct your shoppers in Latin America.
Financial stability and progress
Panama makes use of the U.S. greenback as its foreign money in order that buyers from the USA can really feel safe of their investments. Costa Rica is one other in style 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, buyers can have extra confidence and fear much less about trade charges.
One other profit is how far the greenback stretches in Panama. Because of the measurement of Panama’s economic system, the greenback goes additional, permitting folks to get extra for his or her cash. Advising your shoppers to put money into comparable properties in Miami, Los Angeles, or New York could be rather more costly than in Panama Metropolis and supply them a lot smaller returns. An opulent way of life in Panama is extra attainable. Panama additionally persistently ranks within the prime 10 “Best Countries for Business” for these shoppers investing for enterprise functions.
Political stability
The Panamanian authorities additionally understands the function of international funding in its financial well being. In consequence, it has enacted long-standing insurance policies favorable for worldwide funding and international possession of corporations and property. Panama additionally has favorable tax legal guidelines for individuals who reside in Panama however conduct enterprise exterior the nation. The current election in Panama has buyers 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 this planet. The nation has paved roads, good drainage to forestall flooding and quick web connections.
Individuals who attempt dwelling with out this stuff, as they might in Costa Rica and Panama’s different neighbors, typically study shortly to by no means take them as a right once more. Residing in Panama’s cities is just like dwelling in any U.S. or European metropolis.
Enterprise alternatives
Panama’s financial and political stability gives a world-class enterprise environment. It’s not 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 international 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 revenue, company, capital positive aspects or property taxes on revenue made exterior the nation. Earnings made within the nation is topic to taxation, however worldwide revenue is tax-free. Meaning you may reinvest within the firm or different ventures.
Panama has additionally lengthy been a haven for retirees and a spot to direct shoppers in search of a novel place to retire the place their retirement financial savings will stretch farther to swimsuit our longer life expectations.
Easy accessibility
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 associates from Canada who’re flying out of Toronto and Montreal may also get pleasure from 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 way of life
Panama has lengthy been a vacation spot for vacationers and retirees. Panama’s use of the U.S. greenback and smaller economic system have many advantages. For vacationers and retirees, luxurious actual property is extra reasonably priced than in different markets. An individual who spends $6,600 month-to-month in Orlando would solely want $4,100 to reside in Panama Metropolis. That’s an enormous distinction that provides up over time.
Your shoppers may also put money into luxurious resorts in Panama. The nation is the right choice 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 shoppers.
Panama has white sandy seashores, rugged mountain terrain and plush jungles. Relying on what they’re in search of, encouraging your shoppers to purchase actual property in Panama places them on a path to simple dwelling 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 provides distinctive worth propositions unmatched in Costa Rica or some other tropical nation. The long-lasting Panama Canal is likely one of the seven wonders of the fashionable world. The U.S. greenback drives the Panamanian economic system, simplifying the transition from the U.S. Panama, which is the most important banking middle in Central America.
It additionally has entry to each the Atlantic and Pacific oceans. Panama provides the best mix of modernity and custom with its pure magnificence, non-public islands and seashores, trendy facilities, the historic Casco Viejo (a UNESCO World Heritage website), and the primary man-made island within the Pacific.
Panama provides a lot when it comes to funding alternative and prime quality of life that it is a perfect and profitable panorama for retirees, buyers, 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 shoppers to discover this burgeoning market and assist them discover their model of paradise.
Victoria Levitam is the Managing Accomplice at The Company Panama and CEO of Pars Realty.
