Buy Panama Properties With Us!
When you Plan To Invest In Buying A Property In Any Location Of The World. Also Buying Panama Properties, You Need Information On The Latest Regulations, Taxes, And Maintenance Fees. As well as, Before Making The Investment Need To Consider The Following Points:
We want to help you to make the right decision before buy Panama Properties! We will be happy to advise you!
Steps To Consider Before Making A Real Estate Investment In Panama
If you are thinking of buying a first or second home or as a real estate investment, you should consider the following factors before taking the first step:
• Location: Always consider the right location for your real estate investment. This decision guarantees good value and ease of sale. There are many factors to consider. Commercial real estate is not the same as a luxurious penthouse. But buying a luxury penthouse in a medium area is not the same as that same penthouse in a medium-high or high neighborhood.
• Financing: it is easier for a national or non-national to get mortgage loans in Panama. Banks provide mortgage loans to non-nationals between 50% to 70% of the quick sale value of the appraisal from a recognized appraisal company. For citizens and residents, the financing percentage of the loan could be a little more higger for a foreigner. Usually, banks increase 1 point in the interest rate of the mortgage.
General Requirements Before Buy Panama Property
Depending on the property value. Also, financial institutions consider occupation, profession, and other factors. Another aspect that should consider when applying for a mortgage loan is the continuity in the job and evidence of income in case of being independent.
You need to verify with your bank the list of appraisal companies that thrust before conducting an appraisal on yourself. Also, some nationals of countries with unstable currencies or country economies need to demonstrate an account in dollars where the banking verifies the movement and the years of owning this account.
The bank seeks to confirm its ability to cover the obligation in the event of political or economic instability. Banks accept a grade of indebtedness up to 30% of the income of (the) or debtors. The financing term of the banks is different for nationals and foreigners. For a national, the mortgage term can be up to 35 years. This period depends on age and bank. For a foreigner, the credit can reach up to 20 years. Also, the mortgage loan term is directly proportional to the years of coverage that the life insurance policy provider.
• Appraisal: An appraisal is a property reference value at a moment that may vary over time, but it is not the last word. Some properties sell above the market value because of the potential it has or that they may have and even because of the demand. If you plan to finance your investment with a local mortgage, the bank takes as a reference value of your property, the one known locally as a quick sale that ranges between 10 and 15% below the market value.
• Life and fire insurance: by law, all mortgage loans in Panama need life and fire insurance. The maximum age to be eligible for life insurance is 69 in most insurance companies, although some have increased eligibility. Depending on your job and physical condition, you might get some exceptions. Some companies are more flexible than others for non-nationals.
Fire Insurance Before Buy Panama property
When you take out fire insurance, the policy includes other coverage such as lightning, earthquake, windstorm, and air impact, and the cost per thousand ranges between 7 and 9 cents annually. In commercial real estate insurance, the value of the insurance is subject to a prior inspection. Also, the inspectors verify the location, and accident prevention measures of the property greatly influence the cost.
• Taxes: There are two things that people cannot avoid in life: death and taxes. When buying a property in Panama, you must consider two types of taxes. 1. The property improvement tax and the land tax. Depending on certain conditions, some properties in Panama still have some years of exemption from the tax on improvements. At the beginning of the real estate boom, the periods oscillate between 5 and 20 years. On the other hand, the properties pay a tax on the land.
Tax Family Patrimony (PFT)
The last tax reform, according to Law 66 of 2017, born the concept of property constituted as Tax Family Patrimony (PFT). According to this concept, a base of US $ 120,000.00 has tax exceptions in all homes. From US $ 120,001.00 to US $ 250,000.00, 0.5% is taxed on the surplus up to US $ 700,000.00, and the tax excess is over US $ 700,000.00 at 0.7%. The tax rate on commercial properties is different. Your real estate broker with your attorney can advise you on this matter.
On the other hand, if you sell a property, you should consider the following taxes on the sale value: 2% known as “enajenacion” transfer, and 3% on the sale value for occasional gain.
• Maintenance: Most horizontal properties (PH.) pay a monthly fee that helps cover the main expenses that a group of apartments, houses, offices, or galleys has incorporated into the horizontal property law (Law 31 of 2010). In the moment of acquiring the property, remember that maintenance is an additional charge in your budget and affects the profitability of your investment.
• Lawyer: it is vital to have a good lawyer who has experience in real estate contracts and extensive knowledge of the commercial code in addition to handling taxes before buy Panama property.
• Licensed real estate broker: Another point is choosing a suitable real estate broker. He must be your right hand and actively participate in the entire operation. It ensures the professional has a minimum knowledge of land use, zoning regulations, laws, and incentives. Also, when you work with a licensed professional, you are covered by a bond of up to 10,000 in case of negligence or mismanagement.
Real Estate Technical Bureau
The Technical Board of Real Estate of Panama issues the suitability, an entity attached to the Ministry of Commerce and Industries. You can file complaints or claims with the Real Estate Technical Board.
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