n
Owners Are Asking
Silly Rents…And Renters Are
Competing To Pay More!...
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How To Get A Good
Deal On A Condo Purchase In
Panama City…
n
Ah…So That’s Why
My Costa Rica Car Rental Was So
Expensive…
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Construction
Workers En Greve…Making Us
Feel Right At Home…
AND:
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Best Golf Havens
In The Americas...
-- Premier
Private Retirement & Resort
Community
--
Gran Pacifica
is Nicaragua’s premier five-star resort community by the
sea. There’s a reason more than
200 leading business
entrepreneurs, professionals, and
retirees from around the world
have already purchased here…and
this opportunity will be open
only a short while longer. 70%
financing makes your decision to
own even easier.
----------
Dear Overseas Opportunity Letter Reader,
We thought we had a deal. We made
an offer. The owners accepted it.
The paperwork was in process.
Then, the next morning, a call
from our agent:
“Someone else got in touch with
the owners last night and offered
more money. They took it.”
“Oh…so we don’t have the
apartment?”
“No. The other renter not only
offered more money, but also
agreed to start paying rent
immediately.”
Lief and I tried to begin our
search for a long-term rental in
Panama City during our final
pre-move visit to the country
last March. At that time, though,
we were advised that, unless we
wanted to commit to a place on
the spot…and begin paying rent
even though we wouldn’t be moving
in for four or five months…we
should wait until we were on the
scene and re-launch the search
then, when we were in a position
to act.
Fair enough. So, when we returned
three weeks ago, we put on the
full-court press. Word-of-mouth
is typically the best way to find
an apartment rental in a new city, so we began asking around…friends, colleagues,
acquaintances. We put out every
feeler we could think of. We
bought the local papers and read
the rental classifieds daily. And
we engaged an agent to act on our
behalf.
Lief and I agreed a budget for
the monthly rent, then I set out
to see what I could find that
might suit.
I knew from our experience
renting out our Bayfront
apartment to tourists and
visiting businessmen that the
short-term rentals market in this
city is at full boil. We’ve
gotten as much as $500 a night
for last-minute overnight rentals
in recent months.
However, I wasn’t prepared for
how frothy the long-term rentals
market has grown, seemingly in
the past few months.
As I write (and, unfortunately,
as we find ourselves searching
for an apartment to rent here), Panama City’s long-term rentals market
has become a free-for-all.
Landlords are asking silly
rents…and renters are making
offers that exceed them, even
bidding against each other.
Unprecedented monthly amounts are
being paid for prime units (in
Paitilla, for example, and along
Avenida Balboa overlooking the Bay of Panama)…as much as
$5,000 a month and more.
Admittedly, this is for
three-bedroom,
200-square-meter-plus units with
water views. But, the point is, a
year ago, people wouldn’t have
been able to keep from laughing
out loud if you told them you’d
just rented an apartment anywhere
in this city for $5,000 a month.
Nobody’s laughing now.
And, even if you’re willing to
pay silly rent, you’ve often got
to be ready to commit, to sign a
contract, and to hand over a
deposit, preferably in cash, on
the spot.
Frankly, I feel foolish renting
an apartment in this market at
this time. But we have no choice.
We’re certainly not going to buy
an apartment in this city at this
time…and, well, Jack needs a
place to sleep (other than the
pullout couch he’s been on for
the past few weeks)…and I need an
office. Staff from the States
begins arriving in the city in
less than two weeks, and my plan
has been to use a third bedroom
in our apartment as an office for
several months, until we
establish ourselves.
So, day after day, I’ve been out
there, just like all the other
fools looking to rent a
three-bedroom apartment in a nice
neighborhood in this town right
now.
As I explained, Lief and I agreed
a budget before I set out
searching—that is, before I had
any idea just how nuts this
market has grown. Lief proposed
we find something for $2,000 per
month or less. Seemed reasonable.
I passed this ceiling along to
our agent, and I kept it in mind
as I read through the classifieds
each day.
Indeed, I found several
three-bedroom apartments in
decent areas for rent for $1,800
to $2,200 per month. Then I went
to look at them.
In nearly every case, I
discovered, apartments of the
size we’re looking for renting
for these rates currently are in
what the Panamanians refer to as
“old buildings.”
I’m a fan of old. Our apartment
in Paris has more than three centuries
under its belt. Broken stone
tiles, split parquet, cracks in
the plaster…those things add
character.
That’s not what the Panamanians
mean when they refer to “old
apartments” in their capital
city. They don’t mean charming.
They mean worn-out.
And they don’t mean hundreds of
years old. “Old” in this town can
be seven or eight years.
At least this was how things were
represented to me. But I resisted
the idea at first. Can’t be true,
I thought. Not every building in
this city older than five years
can be uninhabitable. It’s a
local prejudice. A cultural
thing. New is better in this
city…new is good…old is bad. But
I’ll keep an open mind, I told
myself, and try to find something
older. That way I’ll get a better
deal.
I tell you now, after having
looked at several somethings
older, I understood why, in this
town, new is better.
You could buy “old,” as friends
of ours have done, in a good
location, then rehab. This is the
secret to finding an affordable
apartment to buy in Panama City right now. Seek out a unit in a geriatric building,
then replace the bathrooms and
the kitchen, maybe the floor,
certainly the fixtures and
finishes…and, when all is done
and dusted, as my Irish friends
would say, you could have a very
nice place, the cost of which
you’d be able to boast about at
cocktail parties.
But you don’t want to rent
geriatric, because the bathrooms
and the kitchen and everything
else is as-is. You, as the
renter, aren’t going to invest in
improvements, and, once you’re
installed, neither is the owner.
Our $2,000 a month budget
increased to $2,500. For that
rate, we found a place in
Paitilla…the one that the agent
called us the next morning to
tell us had been gazumped out
from under us by renters willing
to pay more rent and to start
paying immediately. We’d asked
for a mid-August start date for
the one-year contract.
“How much more did they offer?” I
asked.
“$500 more a month…$3,000.”
Lief and I regrouped. We told our
agent to expand the search
parameters to include
$3,000-a-month rentals.
Yesterday, we were scheduled to
see four more apartments. One was
rented at 11 p.m. during a
late-night visit to the owner the
night before. A second was
another $2,000 “bargain”
rental…in an old building. We
crossed it off the list.
Leaving two $3,000-a-month
three-bedrooms in Paitilla. I
told the agents on the spot,
standing in the living room of
the second of these, that we’d
take it.
“Oh, I’m sorry,” she responded,
“but I can’t rent to you right
now. Another couple is waiting
down in the lobby to see the
place for a second time. I have
to find out their position before
I can accept an offer from you.”
Normally, you’d assume this was a
line…a white lie to help enhance
your eventual offer.
In this case, we passed the other
couple in the hall on the way to
the elevator.
“If they don’t take the place, I
will,” I said on the way out the
door. “Please call me as soon as
they leave.”
Twenty minutes later:
“They made an offer and handed
over a deposit on the spot,”
reported my agent. “But the
owners of that apartment have
another one, just like it, in the
same building. They had the
second place listed for sale, but
I’ve convinced them to rent to
you instead, for $3,000 a month.
I’ll be right over with the
contract so you can sign and give
me a check for the deposit
amount.”
So, as far as I know, as I write,
we have an apartment.
This circus won’t last forever,
of course. I give it six to 12
months. It’s not that there
aren’t apartments. It’s that the
hundreds of apartments being
delivered to owners (most of whom
bought pre-construction) right
now are being put immediately up
for sale. Investors want to take
their profits.
As more and more of these units
come online, the market for
selling them will continue to
slow, as it has been doing for
six months at least. Eventually,
more new owners will realize, as
did the owner of the apartment we
believe (hope) we’re moving into
in two weeks, that, as selling
becomes tougher…renting is a
great option.
Then, as more and more apartments
are made available for rent, the
rentals market will calm down,
too.
Unfortunately, we can’t wait that
long.
Kathleen Peddicord
Panama
City
P.S. We’ve been looking for
relatively big and comfortable.
Not luxury. But comfortable.
However, it’s not only this
segment of the market that’s
over-heating right now. Our
Marketing Manager, Harry, is
moving to the city in August.
He’s shopping for an apartment to
rent, too. His budget is $600 a
month. I assured him, six months
ago, when he and we began making
our plans, that he’d have no
trouble finding something
suitable for that price. I have
to admit to him now that I was
wrong.
Maybe this was possible six
months ago…maybe not. But it’s
surely not a realistic
expectation today. For that rent,
you get tiny, dirty, and
sometimes unsafe…or you get
outside the city. Harry doesn’t
want to buy a car, and he sure
doesn’t want to brave Panama City commuter traffic every day. He’s increased his
budget to $750 a month, he’s
willing to take a studio, and
he’s agreed to consider
unfurnished. Still, our agent
scouting for him is struggling...
P.P.S. You see the
opportunity, of course, if you’re
fortunate enough to find yourself
on the other side of this
conversation. That is, if you own
an apartment in this city or are
about to take delivery on one you
bought pre-construction, my
advice? Put it up for rental,
either short- or long-term. Your
return potential in the immediate
term is explosive. Thinking
medium-term, your returns should
be great. And even long-term,
you’re looking at the high end of
average, for, while the Panama City rentals market will calm over the coming year or
so, it will remain vigorous and
viable for some years to come.
P.P.P.S. Our local agent has
been the best part of our Panama City rental shopping experience. If you, too, are
foolish enough to be in the
market for an apartment to rent
in this town right now, I’d
highly recommend her. Giulia has
also been a super general
resource, helping us to find a
nanny for Jack, to source
particular household goods, and
to understand the finer points of
getting ourselves connected
(phone, electricity, Internet,
cable, etc.). She also handles
sales, of course. Reach Giulia
here:
PanamaRentals@LiveandInvestOverseas.com.
---------- Turn-key
Retirement ----------
Here’s How You Can Afford To
Retire In Style.
----------
TODAY:
Our man in Costa Rica, David Stubbs, reports that Costa Rica’s
President Óscar Arias Sánchez has
agreed to allow competition in
the country's insurance industry.
In fact, he had no choice. The
opening up of
Costa Rica’s insurance biz to private
enterprise was required by the
free-trade treaty the country
signed with the
United
States.
This is a big deal. It removes
the 84-year monopoly of the
state-owned Instituto Nacional de
Seguros. And it means there’s
hope that, someday, maybe
sometime soon, you won’t have to
pay a mega-insurance surcharge
every time you rent a car in this
country.
***
Inflation has reached a 28-year
high in
Panama,
spiking to 9.6% in June.
***
Meantime, as though the ongoing
construction work weren’t bad
enough, the streets of downtown Panama City have been further blocked this week by striking
construction workers. I have to
admit, though…it made us feel
right at home, walking outside to
find le manifestation in
full swing, the men en greve
pacing up and down, waving
banners and chanting…just like in
Paris…
***
A special constituent assembly in Ecuador has
approved a draft of a new
constitution, the nation’s 20th
if approved in the referendum
scheduled for Sept. 28. If it’s
passed, the new constitution
would allow sitting President
Correa to run for two new
consecutive terms and, further,
to dissolve the country’s
Congress…
---------- Deadline
Approaching ----------
The cost of a Reforestation Visa, Panama’s best
residency option, is scheduled to
double Aug. 26.
If you’re thinking of settling in
the world’s premier retirement
and tax haven, act now.
United Nature Details.
FROM THE MAILBAG:
“I am considering moving overseas
to continue working and then to
retire there. My plans call for
this to happen sometime in 2009
if I can find the right spot and
make the move happen in that
timeframe.
"I am very serious about golf and
want to find a location where
there are a number of golf
courses available for play. I
like the variety of multiple
courses and do not wish to have
to join a club to play.
“Given that my desire is to stay
in the
Americas, do
you have any suggestions? Besides
the golf courses, all I need for
work is the Internet and good
telecommunications.”
-- Stan C.,
United
States
Nicaragua could be a good option.
A golf course is under
construction at
Gran Pacifica
that should be open for play by
the end of this year, and there’s
an existing course on the Pacific
coast at Iguanas.
From a telecommunications point
of view, Panama could be a better choice and has several courses in
and near the city. Costa Rica has many and may be the most
interesting Central American
option for the serious golfer.
The Dominican Republic
boasts a number of courses, at
least a few in each of the key
regions on the island. Argentina has many courses near Buenos Aires plus one or two in each
key area throughout the country.
---------- Borrow To Buy In
Central America ----------
Georgetown Trust lends in
Panama, Nicaragua, Costa Rica, Belize, Honduras, and beyond. Attractive terms.
Find out more about Georgetown Trust here.
