Thread: Real Estate in Panama

Anyone have any idea how much houses/condos sell for below listing price 5% - 10%?Do you make an offer or is it normal to pay full listing price? I am just trying to get a idea what price range I should be looking in. Has the RE market slowed down due to the US melt down?

My suggestion is to come here and live for awhile before making a purchase. Almost everything and everybody (excluding me) on the internet is saying that purchasing in Panama is positive and I am not sure how honest it is? Currently there is a flood of properties hitting the marketplace. Are they going to sell? Are they going to be rented? Is Panama going to make visa's so difficult they wreck their own market? I would honestly wait a little bit. There is ALLOT of stuff for sale. ALLOT of new construction has come to a halt. I don't think anybody can say for sure what is going to truly happen? If I made money on advertising developers/developments I would tell you now is a great time to buy.

My opinion only --- forget Panana City as an investment or a place to live unless you want to live in a large, somewhat congested city. For people looking for a more "exotic" lifestyle and something different from your current lifestyle (if you currently live in a first world environment) consider any other area that has people - small communities, both coasts, the hills, along the rivers, etc. Each area of the country has it's own beautiful things to offer. You can live close to wonderful surfing, great fishing, exciting hiking and beautiful scenery is everywhere. You can have spectacular gardens, make new friends, learn to eat new types of food, learn a new language, etc. etc. Land and building purchase are a good investment and anything is possible. There are certain areas that have skyrocketed in value and now they may not be the great investment for someone wanting to flip a property, but these areas are still a great investment if you want a wonderful place to call your own. These opinions are formed by my experiences in Panama for the past 8 years.

Excellent advice from somebody that does live here. That is what it truly takes to make a good decision. Unless you are from Panama you are a foreigner and this is not like your home country. You really won't know what you want from looking at it on the internet or even a 2 week stay.

Well, I am looking for something to rent out for income. What is the rental market like? Anyone here own a place for rent that they are able to rent regularly? I was going to hold off on buying two properties because of the immigration visa issue. But would still like to get one place in Panama City. I was planning to have it managed and rented out per day and an apartment centrally located for access to all the bars, clubs and casinos. Does anyone still think it is a bad idea? I am not worried about an apartment losing some of its value. But I was assuming that something centrally located would be more likely to retain value and would be more likely to rent out. Am I wrong?

I would ask these questions, do you have experience in this field? Are you comfortable with the country's direction? Do you have a trusted person that will be renting out the unit for you? Will the current rate of inflation (Panama uses the dollar and inflation is a problem here as well) nullify the rate of investment return as opposed to investing in gold or silver? Location in the city is very key. I personally like El Cangrejo for cost and location. You can still walk to the Bank District and even Calle Uruguay is really not that much further. Just some things to think about.

The location I have chosen is the one you mentioned.

As for renting, well, I know of someone i trust well enough - he gets 20% - and that is OK by me if he gets me close to the return I am looking for. But I only have a little experience of renting and that was renting out rooms rather than a whole property.

Gold and silver are good long term investments but not good for regular income, and it is regular income I am looking for. Having said that, if I could have bought in the late 90s when Gordon Brown informed the world markets that he was going to sell a lot of the UKs gold reserves it would have been nice to buy then and be a millionaire now :-)

I am holding off on buying a second property to see how things go with the first, and to give the stock market time to recover - my stocks and shares took a real pounding recently and I want to give the market a chance to recover some of its value. I also want to hold off on the second apartment because I want to see how the visa laws go. I would be able to use the one apartment as a holiday place by booking time in it or using time that is unbooked.

But just out of interest does anyone rent in Panama and do they get a regular return from doing so? The rental returns look good in principle and far better than the UK for the price.

I am traveling to Panama City 2 Aug 08.
My questions and my position are identical to yours.
I would be glad to share my experience when I return.
PM me for personal e-mail address.

I have to say that it does seem like the interest in Panama is still pretty strong. I meet allot of people from all over the place. The people coming here do have money and are looking to invest. I feel that many people (internationally) are probably a little bit scared about their loss of purchasing power and investment return at home. Let's all hope that Panama does the right thing in regards to immigration.

Is it just me or is there a "Boat Load" of available real estate inventory out there? The real tell-tale sign of somebody looking to dump a condo is the lack of any furniture and especially lack of a stove or fridge. Starting to see ALLOT of high-end condo rental's. We shall see if they start coming down in rental price? Another interesting thing I notice is that people with money that are coming down to Panama are not always renting expensive accommodations while they are here. Inexpensive hotels are fine for most people. If you are going to buy take your time and look around. Actually spend time in the town or neighborhood you want to purchase. Travel around the country as well to get comfortable. There will always be another "castle in the sky" or "castle in the cow-field".

Speaking of rentals - My wife and I are looking for a home to rent from mid-December to mid-January close to the beaches (Gorgona -> Playa Blanca area). If anyone knows of something with at least 2 bedrooms, fully furnished, please PM.

Originally Posted by Stuart

Is anyone familiar with the development Altos del Maria in the mountains?

Altos del Maria will take off soon, beach front or ocean views in other places were more attractive then, when they started Altos del Maria. But now, the weather, how close it is from the ocean, the view from your house, well, you should see it. They don't know what they have.

I am looking for a cheap studio appartment in Panama City. I would like to find something in a "safe" area that is about $400 per month everything included. I also need internet access (I expect to pay extra). I plan on staying for 3 months. Would this be a difficult deal to find in Panama City?

Also, are there other cities in Panama that might be cheaper to live in, but also have high speed internet and public transportation?

Thanks,
Joe

Hey MrT, "I pity the fool". I apologize, I could not help it. Rent in Panama City is not cheap. In a half-way decent neighborhood $400/month may get you a bedroom with your own bath, maybe? You will find there are really cheap neighborhoods in Panama City if you are not worried about your safety and welfare. There are a decent amount of buses all over the country and taxi's are really cheap. You can rent a house in allot of towns outside of Panama City for that money and have access to broadband Internet. I would suggest coming down and checking out the entire country before you decide on such a longterm basis

*** Colleague Joel Bowman of The Rude Awakening lives in Dubai. We wondered whether the place was the bubble we had heard, so we posed the question to him. His reply:

Link:
http://www.dailyreckoning.com/Issues/2008/DR082708.html

Here is an article about 1/3rd of the way down under "Don't Think About White Elephants" Wednesday August 27th, 2008, talking about Dubai. It seemed at the very least, thought-provoking. Especially if you are in the market to purchase real estate.

fyi - I had heard about the "Russian thing" (happening here) about a month back in passing by a somewhat intoxicated real estate developer that was making a big sale locally.

Originally Posted by MRWOOHOO

Hey MrT, "I pity the fool". I apologize, I could not help it. Rent in Panama City is not cheap. In a half-way decent neighborhood $400/month may get you a bedroom with your own bath, maybe? You will find there are really cheap neighborhoods in Panama City if you are not worried about your safety and welfare. There are a decent amount of buses all over the country and taxi's are really cheap. You can rent a house in allot of towns outside of Panama City for that money and have access to broadband Internet. I would suggest coming down and checking out the entire country before you decide on such a longterm basis

A couple of friends of mine pay $600 a month rent for a 3 bedroom house in Altos de Maria. BEAUTIFUL out there! I'd live there in a heartbeat if I didn't have to be in the city daily. IT's about 1.5 hours out of Panama City.

And yeah, I'll just piggyback on what you said. Rent IS NOT cheap in Panama City. I pay more for rent that I EVER thought I would coming down to Panama. I was floored by the real estate prices in the city.

I was talking with a real estate agent two days ago and she mentioned that rental prices are coming down. Many people had purchased "blocks" of units with the intention of flipping, OOOooooppps! Now they are on the rental market and have dropped $200 per month in hopes of getting renters. It seems as though the high-end rental prices have come down but the low-end one-bedroom places have come up. Economy always dictates in the end.

Originally Posted by MRWOOHOO

I was talking with a real estate agent two days ago and she mentioned that rental prices are coming down. Many people had purchased "blocks" of units with the intention of flipping, OOOooooppps! Now they are on the rental market and have dropped $200 per month in hopes of getting renters. It seems as though the high-end rental prices have come down but the low-end one-bedroom places have come up. Economy always dictates in the end.

Just my luck. I get locked in when things are at their most expensive... real estate, business deals, girlfriends...

Actually I think the price you are paying for your apartment is a deal, your business deals and girlfriends I cannot comment on, lol.

Is it possible that your's truly is one of the first people to mention the "Russian thing" in Panama City? (Maybe I am wrong?) But either way this does add a new dynamic to the "booming sales pitch" that is so often heard. Let's think for a moment about why other groups of people from different countries would want to purchase "blocks" of condos.

Reason #1 - You have several billion dollars of illegally gotten gains and only countries with banks that the US or World Bank is not allowed to go on fishing expeditions into will let you "clean" it. When you have that many dollars you don't care if you loose some value because it is "only money" at that point. You also notice that actual inflation (including food and energy) is actually double digit. At this point you have enough funds that if it takes a decade (or longer) for the economy to rebound (or a change in currency) who cares?

Reason #2 - You live in a country that is making it difficult for you to do anything with your currency (especially remove it). You also notice that actual double-digit inflation (including energy and food) is chewing away at the value (because the fed is printing so darn much of it) and you have lost some faith in paper or any other domestic assets for that matter. Has anybody else noticed the huge amount of brand spanking new $20 dollar bills in circulation? They stick together when trying to count.

I do allot of reading on the internet and I see ALLOT of people saying "buy gold or silver" because any paper is gambling at this point. The jury is still out on condo investments. One thing that does hold true is trends come and go in cycles. Real estate was a big bubble in allot of places. The bubble has popped in these same places. There are many people that feel the US Fed (or other countries) can print all of the paper it wants and it will retain value. The decision is up to you. Yesterday I spoke with another real estate agent that is trying to help several people unload some high-end property (it had been on the market for months). Anyway, this agent asked me if I knew any "Comrads" that were looking to buy because she was having a hard time finding anybody else.

Last but not least I decided at an attempt at humor and came up with a
Top Ten List Of things Not to say to a well dressed Russian in Panama City: (enjoy)

10. Is that a bloody meat cleaver in your pocket or are you just happy to see me?

9. I saw a bear in a zoo once.

8. Don't you think your country over reacted to Georgia?

7. What do you do for a living?

6. Is it me or is Putin a nutcase?

5. Have you ever used a gun before?

4. Is your watch a "Fugazi" (a fake)?

3. How long do you have to stand in line for toilet paper?

2. Polish voldka tastes better, don't you agree?

And the number one thing not to say to a well-dressed Russian in Panama City is?

1. Rocky Balboa sure taught you guys a thing or two, didn't he?

Ba-dum-bumb!!!!

PS - Good to see who pays attention to this thread. Maybe I will let them buy me a beer at Habano's?

I will buy you a beer at Habano's around the first of 2009.
Thank you for the intelligent perspective and informed info.

Much appreciated Tim. Also to clarify, I am not saying "don't buy anything in Panama". Just don't purchase out of speculation or that you have been told there is a lack of inventory.

I have also heard about eastern european investors. but i have been told the market has slowed down "tremendously" which sounds very like how things got in the UK before prices started to fall through low demand. On the other hand the world at the moment seems to think the USA is beginning to come out of its problems. The dollar to pound and euro is as strong as it has been in years. So, if things improve in the US and more investment comes from there to Panama then maybe panama wont see a bubble bursting, but more of a levelling off.

I REALLY enjoyed my trip to Panama and I would like to purchase a condo (or two)
when the timing is right.
Please continue to keep us up to speed on the unfolding events.
BTW, I like your top ten

Glad you enjoyed the top ten. The world needs a little extra humor (even if it is bad). As far as the global economy rebounding, eh? That is what the TV is saying. I could be completely wrong (wouldn't be the first time) but if you take into account:
1. House prices are still falling around the world.
2. Credit availability is hard to come by unless you are a large bank or lender and the Government (taxpayer) is bailing you out.
3. The government is printing money and creating extra liquidity (like crazy) because of item #2 which is causing double-digit inflation (unless you don't eat food or use any oil-based products).
4. The price of gold is getting manipulated due to hedging by several large banks.
5. Many retirees were looking to sell their house and use the gain to retire.
6. Many people are having to work more years because of the current economic problems.
7. Prices have come down tremendously in many places making it much more affordable to retire in their home country.
8. Many of the homes being sold (example US) are due to foreclosures and short-sells (not sure if the previous owners are retiring after that?).

Basically, I personally believe there is still market for real estate in Panama. I just feel that the market for less-expensive real estate is going to far outweigh expensive. Unfortunately there is no way to really judge how large of an impact the "Russian thing" has had on the local market. Just like there is no good way to show how many of the buildings were built with cocaine money. If somebody had a billion dollars to "invest" that person could purchase ALLOT of real estate here and just sit on it. I see allot of big condo buildings that are "sold out". At night you don't see to many lights on whatsoever in these places.

PS - If anybody is interested just type (or copy and paste) " gold hedge manipulation " into Google sometime.
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Sorry, this is a massive delay in a response. The junk mail folder has be reading my mail.

My last question was about finding a "cheap" appartment in Panama.

What is the best resource for finding houses to rent in the country/outer cities. And is it at all practical to "not have a car" if you are going to live outside of Panama city?

Sinsmerely,

MrT

Originally Posted by MRWOOHOO

Hey MrT, "I pity the fool". I apologize, I could not help it. Rent in Panama City is not cheap. In a half-way decent neighborhood $400/month may get you a bedroom with your own bath, maybe? You will find there are really cheap neighborhoods in Panama City if you are not worried about your safety and welfare. There are a decent amount of buses all over the country and taxi's are really cheap. You can rent a house in allot of towns outside of Panama City for that money and have access to broadband Internet. I would suggest coming down and checking out the entire country before you decide on such a longterm basis

Hey MrT, there are a few places to find them. This is what I came up with after getting a little intoxicated at the "rodeo" yesterday.

1. http://www.encuentra24.com/real-estate-panama-en.html

2. http://panama.en.craigslist.org/

3. http://clasificadosweb.prensa.com/search.asp

4. Make friends with as many people as possible.

I will be traveling to Panama (boquete area) and would like to learn more about values before purchasing. I would appreciate any suggestions. Right now I am considering: talking with Tax Appraisal office?? Visiting with a private appraiser; and talk to realtors. I have a real estate and appraisal background and just don t want to buy on emotion.

Not sure if the tax office will be able to help you out much? Almost anything new is tax exempt. I would strongly suggest meeting with different real estate agents, asking as many questions as possible, and looking at as much real estate as possible. Also talk to as many expats as you can. See what they have to say about the real estate market in Boquete. Keep in mind that is a very heavy US expat population. Also look at Volcan. The town of Volcan is not one big gated community. Both places are very beautiful. Do keep in mind almost everybody living in Panama has a piece of land/house for sale. This turns everybody into a real estate agent.

Thanks Mr Woohoo. I will try your suggestions. I just wonder if anyone in this forum has used a good appraiser in the David area. I really like to rely on "sold comps" vs "listing prices"; so, i am just hoping there is an appraiser out there that keeps up with "sales".


I know there is no MLS service and I used to face this when looking for comps in very rural communities in Texas years ago -- its just gonna take more digging.