Have you been thinking about investing in Panama? Good call. Panama has had an incredible ten years or so when it comes to foreign investment, and it鈥檚 still growing as we speak. One of the biggest areas of growth and profit returns is real estate. Panama鈥檚 real estate market has been steadily building on itself for the past 4-5 years, with many new projects still slated, and plenty of investment opportunity spread around all sectors. In real estate, timing is everything, which is why having a stable market opens so many doors. Panama鈥檚 market is far less volatile than other popular expat investment countries in the region, and this lends a lot to the value (and returns) on Panama properties. With a stable market, you can buy into Panama real estate without such a high-risk investment. The results, well, they speak for themselves.
Breaking down Panama鈥檚 current real estate market
Panama is definitely a buyers market these days, and we can pinpoint that on two solid factors:
-A) Supply is in abundance, and new construction is projected to remain steady for the next 5 years at least.
-B) Panama鈥檚 economic 鈥渂oom鈥 period of 2011-2013 has slowed a bit, lowering demand on the property abundance, while leveling out prices.
What this means to potential investors is the while future economic growth is expected, prices aren鈥檛 skyrocketing like they did a mere four years ago. This stability of pricing, combined with new properties, and planned growth, has created a market that鈥檚 ideal for a buyer, and good for a seller. So, while your investment may not cash in quickly like it would have five years ago, the price will un-inflated, yet still a good buy based on current growth statistics. In other words, you can buy medium and sell high, but you may have to wait a bit longer. As a seller, you鈥檒l still get a good deal if you bought your property 5+ years ago, so you won鈥檛 lose or have to sit on your target price for very long either.
Using the rental market to finance your property investment
Despite rents leveling out a bit in 2016 and 2017, the demand for rental property in Panama is still huge. Retirees and other new expats often choose renting before buying, with many signing onto 1 or 2 year leases from the get go. Rents are rather high in Panama due to this demand, which can be a huge bonus if you鈥檝e financed your property purchase and want to pay for it with rentals. It鈥檚 also a good way to turn a long-term profit on your investment property if you plan on waiting for the market to jump up again before you re-sell. Properties are in such high rental demand in Panama City these days, that developers are building outward into the suburbs, in anticipation of the remaining Metro lines and easier access to the city.
No matter what your motivation for investing in Panama real estate, it鈥檚 important to remember one thing: Panama has the most stable economy in Latin America. A real estate market with stability and future assurances is ideal for foreign investment. Your risks are much lower, you鈥檙e almost guaranteed to turn a profit, and you鈥檒l have fewer outside political factors to deal with in the long run.
