Articles Related to Property in panama city

Third, consider inventory supply and demand. The Costa del Sol, for example, is ridiculously over-supplied. So, even though prices in that part of the world have collapsed over the past few years, I wouldn't recommend it as a place to shop for a rental investment…though other parts of Spain's coast are a buy right now, as our correspondents in that part of the world have been reporting recently.

The key consideration, though, when looking to buy to let overseas is the rental manager.

You can act as your own rental manager, but I don't advise it. If you're not residing physically in the same place as the rental unit, I say definitely don't try it. I've had more than 20 years of investor-landlord experience in more than a dozen countries. This isn't something you want to take on yourself unless you're prepared to make it your full-time occupation.

Engage someone who knows the market, who has marketing infrastructure in place, who has developed a client list you can leverage, and who can show you proven management systems (for reservations, for inventory control, for reporting, etc.).

Our first apartment investment in Paris rented extraordinarily well the first year. However, the rental manager spoke no English and was perpetually late with reporting. So we switched to another manager, an American. Yes, he spoke English, but he, too, was perpetually late with reporting...and, more to the point, he got us less than half the occupancy we'd enjoyed the year before, though the market was stronger and tourism figures were up.

When you make a rental investment, you're choosing, first, a market; next, a rental manager; and, finally, a property. Before you make a particular buy decision, seek advice from the rental management agency you're planning to work with. What's more rentable? Two bedrooms...or one?

What matters most to would-be renters? Location, of course...but other, less obvious things can be critical. In Paris, you'll struggle to make a decent return off a fifth-floor rental in an apartment building with no elevator.

I don't recommend long-term unless you're well familiar with the market and have a rental manager who really knows what he or she is doing. In many markets, it can be difficult to evict a long-standing renter.

When we made the decision to rent our Paris apartment long-term, we interviewed potential rental managers. The one we chose impressed us because she made a point of telling us, with a voice of long experience, to whom she would not rent.

"We won't rent to such-and-such people, because they throw wild parties," she told us.

"We won't rent to so-and-so people, because they don't respect other peoples' property."


In some contexts, her positions might be termed discrimination. We saw them as risk management.

A global portfolio of rental properties (or even a single well-selected rental apartment) isn't a strategy for getting rich quick, but it is one of the best options available today for solid, reliable returns with the potential for capital appreciation over time and immediate diversification, which should be an overriding agenda of every investor today.

What level of yield should you expect? A minimum of 5% per year net. Buy under-market or identify a market with some particular distortion at work (to do with inventory supply and demand, occupancy rates, seasonality, room rates, etc.), and you can net 10% per year or more.

Leverage can expand your return considerably. Lief and I are netting (after all associated costs and expenses) more than 20% a year right now, cash on cash, from a leveraged rental we own in Panama City.

Kathleen Peddicord

P.S. Watch for insights and recommendations for how to make an agricultural investment in part 2 of this series next week.

Editor's Note: Making a first rental investment overseas, building a portfolio of rental investment properties, managing rental properties long distance, and where to invest for the best net yields will be key topics of discussion during our second annual Global Property Summit, taking place in March 2015.

You can get your name on the Hot List for first alert when registration opens for what will be the biggest and most important global property event of the year here.

Continue reading: Evaluating A Property Investment In Abruzzo, Italy


Live in Panama City





Arriving in Panama City, you recognize instantly that this town is open for business, pushing for growth, and both embracing and chasing prosperity. Your heart rate quickens, and your mind works quicker, too, trying to keep up with the commotion all around.

Arriving in Medellin has the opposite physical effects. Your heart slows a bit, your mind settles.

Live in Medellin





Unlike Panama City, Medellin's cityscape isn't all high-rise condo towers and features nary a single building of glass or steel. From any height (the windows of one of the city's luxury penthouse apartments for example, or the top of one of the surrounding hills), Medellin appears a sea of red clay tiles and red brick buildings interspersed regularly by patches of foliage and flowers. The effect, again, is calming, peaceful.

You can learn a lot about a place both from and by its taxi drivers. They're a top source of getting-to-know-a-city information and insights, of course, but they're also a barometer of the mood of a place. In Panama City, taxi drivers are in a hurry. They honk their horns constantly. They weave in and out of traffic, from lane to lane, pushing for constant progress. They can't abide sitting still or even slowing down and tend to run traffic lights and ignore things like "Stop" signs. They also tend to be unhelpful, even rude. A Panamanian friend describes them as "among the least appealing people on earth." I can think of a handful of exceptions (including our own retired taxi driver, Alberto), but, in general, I'd agree with my friend's assessment.

In Medellin, the taxi drivers, like their city, are gentler and calmer, happy to stop to offer directions or even to chat. In Medellin, you rarely hear the honking of a car horn, not by a taxi driver and not by anyone else either. It's also worth noting that, in Medellin, taxis are not only ever-present, but also always painted yellow and metered, unlike in many of the places where we recommend you spend time. Again, orderly...genteel.

Medellin is impressively green, with trees, plants, and small gardens everywhere, and remarkably clean. In the central neighborhoods, you see no litter. The metro, a point of pride for the local population, is spotless and like new. At every station and in every train we've ever ridden, I've looked for but have been unable to find even a cigarette butt or piece of gum on the ground.

Panama is working hard to clean up and green up its capital city. The long stretch of parkland along the bay known as the Cinta Costera has dramatically changed the face of Panama City for the better (and is being expanded). Still, while one might describe Medellin as genteel, an appropriate adjective for Panama City might be gritty.

Walking around Medellin, especially outside the central tourist zone, Lief and I feel like an anomaly. This is less and less true, as Medellin becomes more discovered by expats and retirees. However, in Panama City, Americans are everywhere. We have been part of the landscape in this city for nearly a hundred years.

From a cost of living perspective, I'd put these two cities on par...depending on the relative strength of the Colombian peso. Right now, the U.S. dollar is right around the middle of the range it's traded in versus the peso since we began paying attention a few years ago. We watch this, looking for opportunities to exchange dollars into pesos to cover carrying costs for our apartment in Medellin. In Panama, where US$1 is US$1, this isn't an issue. The American in Panama has no exchange-rate risk to worry about. If you intend to retire on an income fixed in dollars, this can be an important plus.

The most exciting thing about Medellin from a value point of view is the cost of real estate. The real estate market in Panama City has settled noticeably from its boom-time highs of five or six years ago. Today, you can buy in this market for US$1,500 to US$2,200 per square meter (down from the US$2,000 to US$3,000 per square meter of the golden age of last decade).

In Medellin? You can buy in El Poblado, considered the best address in the city, for as little as US$1,200 per square meter (resale). In less central, more local neighborhoods, you can buy for less.

The real estate market in Medellin reminds me of the market in Panama City when we first began paying attention to it about a dozen years ago.

Panama is one of the world's most welcoming countries when it comes to establishing residency. In Panama, the would-be expat, retiree, or entrepreneur has more than a dozen options for how to establish full-time residency, including the new "Friends of Panama" visa option, which amounts not only to the most user-friendly, turn-key residency option in the world today but also the most user-friendly, turn-key residency option in the history of residency options. Plus, it can lead to a work permit, which is a big deal.

Colombia, too, though, offers good foreign residency options, including one for pensioners and another for investors. The minimum investment requirement in each case can be less than for comparable options in Panama.

One practical matter that is not as straightforward in Colombia as it is in Panama is opening a bank account. It's not possible as a foreigner to open a local bank account in Colombia unless you have a personal introduction to the bank. If someone tells you otherwise, they're speaking optimistically and not from real world experience.

The alternative is to open an account with what's called a "fiduciary," the local equivalent of Charles Schwab. Unlike opening a bank account, this is relatively straightforward and a reasonable strategy for dealing with local bills. The downside is that transaction fees can be high.

The other downside to Medellin compared with Panama City is that few in Medellin speak English, whereas, in Panama City, it's very possible to get by speaking no Spanish.

In addition, Medellin (again, very unlike Panama) is not a tax haven, and taxes are high. Living in Medellin, your tax burden could increase, depending on your nationality, where you hold legal residency, and where your income comes from. The country even imposes a wealth tax (after five years of residency). Note, though, that moving to Colombia with only retirement income should be a tax-neutral event. Colombia, like most countries, doesn't tax foreign retirement income.

Unlike Panama, Colombia imposes exchange controls. These are manageable if you plan and execute any investment in the country carefully and correctly. But, again, they're not an issue at all living in Panama.

Bottom line, here's how I'd break all this down...

Living in Panama City Versus Living in Medellin:

Cost Of Living: It's a tie, more or less, depending on the relative strength of the Colombian peso...

Cost Of Real Estate: As much as 50% less expensive in Medellin...

Climate: Way more comfortable in Medellin...

Quality Of Life: This is completely subjective and impossible to pin down. Nevertheless, I'll go out on a limb and say that the overall quality of life is much more appealing in Medellin than in Panama City...

Ease Of Residency: Panama is one of the easiest places in the world for a foreigner to establish full-time legal residency, especially if he comes from one of the countries included in the new "Friends of Panama" visa program. However, Colombia is also a very straightforward option in this regard. Certainly, I wouldn't take Colombia off my list for fear of a complicated struggle related to becoming a resident...

Ease Of Banking And Doing Business: Here, Panama wins hands down, with its international banking industry (the exchange-of-information treaty the country signed with the United States in 2010 notwithstanding); its lack of any exchange controls; the absence in this market of any currency exchange risk (as Panama uses the U.S. dollar as its currency); and its greater prevalence of English-language speakers...

Infrastructure And Accessibility: Another tie...

Taxes: Panama is the screaming champion on this score, a true tax haven, while Colombia qualifies as a high-tax jurisdiction, with, for example, a 33% corporate tax rate. Again, though, if you're a retiree making a move with retirement income, you probably don't have to care about this...

Health Care: Top notch on an international scale in both cities...

Ease Of Settling In: Panama City is a kind of halfway house for expats, a very easy and comfortable first step overseas. Medellin is more an emerging expat destination, though it is more discovered and therefore easier to navigate as an expat or foreign retiree all the time...

Which place might be better for you?

I can't say. As I remind you often, it depends on your personal circumstances, your priorities, and your preferences. What is your current situation and what kind of experience are you looking for?

I can tell you that we've decided not to try to choose but, instead, have worked over the past few years to incorporate Medellin into our long-term retire-overseas plan.

As a new friend in Medellin, another expat who also divides his time between that city and Panama City, put it recently: "Do business in Panama but live in Medellin. That's the ticket..."

Lief and I would agree.

We won't be relocating from Panama anytime soon. We've based our business here for the long haul. However, we have made a commitment to Medellin, too, with the purchase, two years ago, of an apartment intended to be another home base for us and where we hope to be able to spend time regularly starting later this year.

We're even making plans for a satellite Live and Invest Overseas office in Medellin, to complement our base in Panama City. Stay tuned.

Kathleen PeddicordContinue Reading:

  • What Is A Cedula?

Image sources: Medllin - Antioquia and Hollic


where to live in panama

From Paitilla we moved to a renovated Spanish-colonial house in Casco Viejo. The house was great (historic and architecturally interesting) but too small for our family long term. Also, Casco Viejo, this country's World Heritage Site neighborhood with centuries of Spanish-, French-, and American-colonial history, while, no question, our favorite part of Panama City, is also an increasingly maddening place to try to commute to and from. The ever-expanding construction (renovation of old houses in Casco Viejo and never-ending erection of new high-rise towers in every other part of Panama's capital); infrastructure (further expansion of the Cinta Costera to include an extension around the Casco Viejo peninsula over the sea, plus re-running phone and electricity cables underground and building the new city metro); and beautification (relaying the old brick roads in Casco and landscaping along the Cinta Costera) projects this city is investing in mean that getting in or out of many spots within it, especially during rush hour, is an experience to test the patience of a saint, as they say. Casco Viejo is one of those spots.

Finally, we had to admit that we liked the idea of living in an old colonial house in Casco Viejo more than the reality. From Casco we moved to Marbella, in the center of the city. Much more convenient location. In addition, this is one of the few places in Panama City where you find houses. Most of this city is given over now to apartment towers.

Alas, the convenient location in the heart of the city has meant that, over the past two-and-a-half years that we've been living here, we've watched as our neighbors have decamped, one by one, and the houses they've left behind have been rented not to other families but to commercial enterprises. Our neighbors now include CompuLine and an architect's office. In addition, Monday through Friday, our street serves as a primary parking lot for employees of the half-dozen banks within walking distance. Every morning at 7:30 when we leave for the office, we have to maneuver carefully out of our driveway and between the solid rows of parked vehicles on both sides of the narrow street. If we return home before 6 p.m., we often find someone else's car in our driveway.

Where to next?

We've agreed we'll make just one more move. I'll schlep our stuff and ourselves from one point in this city to another once more, but that's it. So we've been taking our time, trying to make sure we get this right finally. The search has extended, now, as I said, for more than a year.

We talk often about the inefficiencies and other downsides of trying to find a house to rent or buy in a market without a multiple listing service (MLS). One is that, because no agent can know everything that's available at any time, you must work with as many agents as possible. This translates into a considerable investment of time, both yours and the agents'.

We've undertaken this most recent Panama City search in fits and starts. We travel often and are out of town for extended periods. However, when we've been in the city together, Lief and I have dedicated an hour or more a day to this effort, going out, sometimes, with five different agents in a single week. In the end, we've worked most closely with three agents, each of whom has invested even more time than we have trying to find us the ideal place to call home. Joselyn, Thelma, and Andre have chased down owners, made inquiries of doormen, and followed up on Se Vende signs, tips from friends, and local classified listings that have gotten our attention. They have tolerated our seriously schizophrenic approach, which has had us renting, then buying, now renting again, as we've tried to consider every possibility. Along the way, they have negotiated rents and lease terms, down payments and seller financing. With each agent, we have come very close to signing on the dotted line at least once.

Frankly, we've been nightmare clients. We've been certain of our plan and then reconsidered it completely. Through it all, Joselyn, Thelma, and Andre have been patient and gracious, helpful and accommodating.

Now, again, we believe we're at the end of this search. We've found a Spanish-colonial house that checks all our boxes. It's big enough for our family, plus private, and it's been recently renovated to include new bathrooms and a new kitchen, as well as a swimming pool and a nice back yard. It's also in a pleasant, well-kept residential neighborhood that is within walking distance of our office, meaning no daily commute! With the help of the agent (in this case, Andre), Lief has beaten up the owner on price, and, as of yesterday morning, when we did a final walk-through of the property, we're ready to move ahead.

We're very happy for Andre, who will make a nice commission from this deal. However, the situation is highlighting another downside of doing business in a property market without an MLS.

What about Joselyn and Thelma? Each has made a big investment over many months, and now, it seems, is going to walk away with nothing! They're both pros and understand, I realize, that this is the way it goes in a market like this one. None of us had any way of knowing how all this would play out. Now that we do, though, Lief and I can't help but feel bad for the two ladies who have been both pleasant and persistent in their efforts to find us what we were looking for, even when we didn't seem to know ourselves.

We're sending Joselyn and Thelma each a small gift, along with our heartfelt gratitude and best wishes.

But, jeez, that hardly seems a reasonable return for the efforts they've made. Especially as, I have to admit, I hope we never find ourselves in need of their services again.

Kathleen Peddicord

P.S. What else this week?

  • Matthew J. Downs, founder and president of the new, non-partisan organization known as the Center for Medicare Portability, based in Washington, D.C. (, writes:


As you likely already realize, if you're an American living, retiring, or traveling overseas, your Medicare doesn't travel with you. Currently the United States prohibits Medicare from paying for medical services for retirees outside the country and its territories. The nearly half-million retired Americans living overseas and the millions more who travel extensively abroad must either go without care until they return to the United States or pay out-of-pocket for the care they need. We see this as a fundamentally unfair situation for retired Americans who have paid into Medicare their entire working lives. This restriction on Medicare coverage is also unfair to American taxpayers because it ignores the potentially huge cost savings to Medicare offered by lower-cost healthcare options abroad.

The time has come to make Medicare portable and to give ordinary retired Americans the same benefits enjoyed by Americans working abroad for U.S. companies, active and retired military personnel, retired civil servants, and even members of Congress...

  • Asia Correspondent Wendy Justice writes:

Recently, as we were trying to make our way back to Beijing from Kashgar, in the far west of China, we were reminded that even though we may not involve ourselves in the internal mechanisms of our guest country, we still are affected by them. In this case, we were traveling during "Golden Week," China's eagerly anticipated week-long national holiday, when nearly all of the 1.3 billion people residing here enjoy a full week's time off from work and school and take the opportunity to travel.

Well, not all of them. Official estimates reported that "only" 647 million drivers and passengers took to the roads. An additional 79 million passengers, including us, used the railways. We were actually fortunate that we were able to get train tickets at all. Tickets sold out 12 days in advance--the day that they became available...

  • Asia Correspondent Wendy Justice writes:

Sometimes, just the name of a place can conjure up images of the strange, different, and exotic. Mandalay, Marrakech, Casablanca, Kathmandu...

When I first read about the Silk Road, I heard the name Kashgar, China. I liked how it rolled off my tongue. Kashgar. I imagined men in turbans sitting on plush pillows passing around the hookah, women in flowing gowns cooking pots of stew, the children tending to the camels resting amid the sand dunes, sounds of Middle-Eastern music bringing life to a desolate land...

  • Years ago, a friend--a smart guy...a guy who'd been around the block...done business all over the world--engaged an attorney to help him structure his holdings to mitigate his global tax liability.

My friend spent more than US$100,000...didn't understand the structures he ended up with...didn't want to ask more questions, because they led to more answers he didn't understand and more billable hours...and, then, a few years later, found he was in violation of some French tax code he'd never heard of. Certainly, he didn't mean to run afoul of the French tax authorities. And, even when presented with the facts, he didn't understand exactly what he'd done that he shouldn't have done.

In the end, he had no choice but to pay the resulting US$50,000 fine...and, then, to hope no further surprises awaited him down the line.

I joke now and then in these dispatches about how mind-numbingly complicated, as I like to say, this international tax and structure stuff can be.

It is. And it doesn't have to be.

At first, when you're starting out, making your first foreign real estate purchase or setting up your first offshore corporation, it's intimidating. You don't know what you don't know. You fear you'll end up like my friend, breaking some tax law you didn't know existed...

PLUS--From resident global real estate investing expert Lief Simon:

My investment focus is real estate and other hard assets. When I've invested in stocks, I've mostly lost money. The problem for me with stocks is that you have to pay attention on a daily basis to each and every company in which you own shares. Hard assets make more sense to me for many reasons, including the fact that values aren't likely to change by 10%, 20%, or even 50% or more in a single day, as they can for stocks, simply because some piece of bad news related to the company in question is circulated.

On the other hand, real estate is not very liquid. Even in an active market, it can take months to find a buyer and complete a sale. Metals--precious and industrial--are more liquid and don't require the same capital commitment that real estate can. You can buy a fraction of an ounce of gold if you like. The premium on that piece of gold will be high, but the point is it's an option if you don't have enough cash to buy more.

On the other hand, gold and silver are typically seen as places to store your wealth rather than as investment vehicles. Prices of these metals reflect sentiment as much as anything else. Industrial metals, more specifically rare strategic metals, are an exception. These can be both a hedge against inflation and an investment in a hard asset that has the potential to increase in value as consumption surpasses demand.

Rare strategic metals are used in every modern product you can think of, from iPads to cell phones, from flat-screen TVs to jet planes. They are "rare" because they are difficult to mine and are generally by-products of other mining operations. Mining them is dirty work...not environmentally friendly. Most mines producing these metals in Western countries have shut down due to the cost of complying with environmental guidelines and restrictions.

As most of these metals aren't to be found on the commodities exchanges alongside gold and silver, prices are controlled by the supply/demand cycle rather than by investor speculation. A manufacturer who needs indium for his product is going to buy the amount of indium he needs no matter the price. The amount of indium needed for any single unit of production is so small that the effect on the final product price is insignificant.

The metals in question include but are not limited to:

  • Indium -- used for LED screens, flat screens, cell phone displays, and jet engine bearings...
  • Tantalum -- used for capacitors for cell phones and cars, surgical instruments, and medical implants...
  • Gallium -- used for integrated circuits, lasers, fuel cells, and pharmaceuticals...
  • Hafnium -- used for electrodes, light filaments, and computer chips...
  • Tungsten -- used for light bulbs, welding, munitions, and jet engines...

The problem for the small investor is finding a way to invest in the metals directly, as, unlike gold and silver, you can't simply call up your broker and place an order.
A group out of Europe has addressed this challenge. SwissMetals, Inc. (SMI), working with sister companies involved in the industrial metal industry in Germany and Switzerland, has created packages of different rare strategic metals that you can purchase as an individual investor.

Unlike some physical gold programs that require a minimum investment of US$125,000 or US$250,000, the lowest-priced basket is currently priced at around US$6,500. The highest-priced basket is currently selling for around US$23,500. And SMI will arrange for storage of your metals until you're ready to sell (which is a good thing as these metals are sold in kilograms rather than the ounces that gold and silver trade in).

An investment in rare strategic metals doesn't replace the need for some gold and silver in your portfolio as a hedge against currency crises. However, I see this new asset class as an excellent inflation hedge as well as a play on the continued growth of the global economy. With stocks, you have to decide which company in which country will do well. An investment in rare strategic metals doesn't depend on which products or which countries are doing well. As long as the products that use the metals are being made and sold, your asset value has the likelihood of increasing. That's the kind of "sit back and watch" investment that makes sense to me.

You can inquire for more details on the four different baskets of rare strategic metals currently available from SMI here.

Mention you are a reader of the Overseas Opportunity Letter when you inquire about the rare strategic metal baskets at SMI, and they will give you four years of free storage on the "D" basket and three years of free storage on the other three baskets.


Kathleen Peddicord's New Book
"How To Buy Real Estate Overseas"
Available Now Pre-Release!

Kathleen Peddicord's latest book, published by Wiley & Sons, hits bookstores April 8. Starting now, though, you can buy a copy pre-release and save 36% off the release price!

Go here now to order "How To Buy Real Estate Overseas"!

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Kathleen Peddicord

Kathleen Peddicord is the founder of the Live and Invest Overseas publishing group. With more than 25 years experience covering this beat, Kathleen reports daily on current opportunities for living, retiring, and investing overseas in her free e-letter.

Her book, How To Retire Overseas—Everything You Need To Know To Live Well Abroad For Less, was recently released by Penguin Books.

Read more here.


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