Thread: making money in panama

Hello.

How viable is it to own income producing property (e.g. duplex, small apt. building) in Panama? Is it legal to gain income from renting a unit in a multi-unit building one owns?

Not old enough to retire, and have no pension; I am thinking of legal ways to generate a modest income while in country.

As far as I know, it is legal. I live near Las Tablas. I have been looking very hard for a home to purchase here. When I consider the price of the properties and the possible rents that could be obtained, it doesn't add up. For example, a 25 thousand dollar house that you could rent for only 100 dollars per month. I have seen four-plexes that rent for 50 dollar per month each etc. And, the renters destroy the property and are not dependable paying the rent. Doesn't seem feasible in my neck of the woods. Maybe in different areas it might be worth it. Out here, a family that can afford to pay rent will build their own house.

Pollerkeeper,

How long have you lived in the Las Tablas area? Are you going to purchase something in that area?
What have you found is the largest adjustment to life in Panama?

Thanks,

david: please start a new thread.

Pollerkeeper:

Is it really that cheap to rent there???? The homes must be in terrible shape or in terrible neighborhoods.... please enlighten me...

The homes come in all shapes and sizes. You asked about earning an income from rentals so I answered that part. I don't know all the answers but I understand a little. Affordable housing is subsidized by the government by offering those who qualify extremely low interest loans to buy homes. Those families that can afford to rent, can afford to buy a home in the 30 thousand dollar range. So, those families that cannot afford to buy will be your renters and they are not a good pool of clients. Or, if you did find a dependable family they would rent just long enough to build their home. The payments on these new homes are only around 100 dollars per month. Panamanian's prefer new homes because of the 20 year tax deferment. Used homes have less value because of this, unless it is a real intriguing location or something unique about the property. Nice 3 bedroom homes(not big), in conveniently located neighborhoods run 40 to 50 thousand dollars here. They would not be good rental properties unless you could find Xpats to rent them and that would hit or miss at best. Homes in the 25 thousand dollar range can be found in barrios further away, on poor roads and they are usually 2 bedroom 1 bath and very small.

I think it is possible to stumble into deals on small homes if you live in the town you are targeting. I have a lead on a house in a very nice neighborhood and have seen the home. I think it could be had for 32 thousand and rented for 200 or 225/month. If you have 4 or 5 homes like this and you could keep them rented, you could survive here on the rental income. I think the potential for price appreciation when you decided to sell these homes later will be very limited. But, who knows?

Thanks for the response.