“Kathleen and Lief, we need your advice. We are planning to spend part of our time in Panama City and are looking to buy a rental apartment to help us with our day-to-day budget. Lief mentioned on your website that you have rental property in Panama City that generates a good return now.
“Is it still possible to find a good buy-to-let property there and generate around 10% net now, or this time is long gone?
“We are planning to spend US$150,000 to US$200,000 and prefer long-term versus short-term rental. (It is more stable in our view. Maybe we are wrong here?) Please advise if you can where and what to look for in Panama City?”
–Valentina B., United States
I don’t think you’ll find something to generate a 10% net return in Panama at this time. Maybe you could find something to return in the range of 8% net, maximum.
For the capital investment you’re looking to make, I’d suggest that one of the one-bedroom apartments along Avenida Balboa could make sense. Our rental apartment in Panama City is in this area, in a building called Bayfront Tower. You can find units for less than US$200,000 in the building still, and you can rent, long-term unfurnished, for around US$1,500 a month. The HOA fee is US$150 a month. Property taxes aren’t much. Those numbers translate to a net yield of about 7%.
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