The motivations of the buyer to purchase luxury real estate in Panama, including the desire for greater security, corporate relocation and business opportunities as well as a perception of value compared with the countries of origin in the case of a second home purchase.
Most buyers of luxury properties in Panama, are of foreign nationality. However, the market for local buyers is also very active, with the Panamanians in the last seven years seeing an unprecedented level of wealth creation and increased purchasing power.
In Costa Rica, where most property buyers top level are still coming from the United States, buyers of luxury real estate in Panama include Latin American countries like Colombia, Venezuela and Brazil, citizens Europe and the US, along with a resurgence of Panamanian local buyers.
Panama has been actively qualified himself as a good place to do business, and these marketing efforts, along with policy changes on the side of finance and immigration, have resulted in a considerable number of companies that choose to relocate or expand their operations in Panama.
* Tax incentives, relocation incentives, and a stable business climate has attracted a number of multinationals to establish a presence in Panama, including Heineken, Procter and Gamble, Caterpillar, and Bayer.
* Sectors such as shipping and transport industry all banking and financial services, logistics and freight transport services have experienced strong growth in Panama over the last decade.
* Factors such as schools, restaurants, and infrastructure, which are not necessarily comparable to the best tier cities such as Paris, London or Madrid, are enough to force a move and reassure a reasonable quality of life in Panama.
Many companies such as Philips, Samsung, and Unilever, seeking to consolidate its presence in Latin America to Panama City, due in part to Law 41, which was created to provide incentives through tax breaks, incentives for relocation, and growing number of corporate-friendly initiatives.
Economically speaking, Panama remains on land and prospects for the future are positive. For a country of less than 4 million people, per capita GDP is a healthy $ 17,000 per capita, far ahead of most developed countries, such as Brazil, Colombia and Mexico. Furthermore, Panama has experienced consistent growth of GDP over the past eight consecutive years, with an enviable 7% projected for the end of 2014.
Moreover, it is important to note that asset protection and wealth preservation usually forms a key part of security plans rather designed for wealthy individuals assets. Many foreign investors have deployed capital in the real estate market in Panama as a means to diversify your portfolio.
Properties in Panama are often structured using dual entities, private property interest foundation holding more than one international business corporation Panama, which in turn holds the asset. In the event that the asset is producing income, private foundation acts as a receiver of funds in a bank account in Panama.
Panama allows the use of a corporation anonymous participation to possess any type of real estate. Ownership of real estate and other assets, whether owned by a corporation, is anonymous. There is also no obligation to report sales or transfers of shares of capital and, therefore, many real estate transactions are not transparent to the market.
A number of wealthy individuals have moved to Panama and buy real estate because of the Law 120, which states that all income earned outside of Panama is tax exempt. This law benefits people who are “Location-Independent” and can work anywhere in the world, and most of these types of buyers end up in the city thanks to reliable Internet and easy access to the International Airport.
Investors seeking cash flow have also gravitated toward the housing market in Panama, where high rents and relatively low cost of purchasing and maintaining present an attractive investment scenario. Investors in managed properties residential real estate, in the course of one month of vacancy and at or below market acquisition costs generally have a cap rate on rental properties between 5.5% and 6.5% without taking into account the appreciation.