The May/June 2008 issue of Modern Maturity magazine rated Boquete in Panama, the fourth best destination in the world. International Living rates Panama even higher on their list at No.1. As well as the cool lush highlands of Boquete, Panama has a perfect location for every taste; from a cosmopolitan capital city to palm fringed beaches, cool mountain climates and tropical resorts. However, the best thing is that it is affordable both to live as well as buy real estate here!

In terms of variety of property perfect for spending those later years there is something for everyone here: condos with security and all sorts of on-site facilities, modern super luxury penthouses in the center of town, pretty ocean front homes with a jetty and a boat, island hideaways with monkeys and parrots for neighbors or cool sophisticated properties in the mountains with gardens and views over the coffee plantations.

Panama is beautiful. From gorgeous cool mountain retreats like Boquete, to fabulous beachfront property in Bocas, or cosmopolitan city apartments overlooking a stunning harbor in Panama City, the choice is yours. With real estate prices beginning to rise, you also have an opportunity to make a considerable return on your investment if you buy now.

Rental property is in high demand particularly in the highland areas, so even if you are not looking to retire for a while this is an opportunity to get into the market and earn a return on your investment in the meantime.

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Retirement Package

The Panamanians really know how to treat the older generation! Apart from a whole host of other benefits Panama has one of the most generous national packages in the world for people who are able to retire from work. It includes; Import tax exemption for household goods up to $10,000 Tax exemption to import a new car every two years 25% discounts on utility bills 25% discount on airline tickets and 30% on other transportation 15% discount on loans made in your name 1% reduction on home mortgages for homes used for personal residence 20% discount on doctor’s bills 15% on hospital services if no insurance applies 15% off dental and eye exams 10% discount on medicines 20% discount on bills for professional and technical services 50% discount on entrance to movie theatres, cultural and sporting events 50% discount at hotels during Monday to Thursday, 30% on weekends

The main requirement for qualifying for a
pension ado (retiree) visa is proof of a minimum income of $1000 per month plus an additional $200 for each dependent. This program is not age related provided you have a pension. Foreign residents of Panama, regardless of the type of visa they obtain, who are over the age of 55 years for a woman and 60 years for a man, are entitled to most of the retiree incentives listed above with the exception of the importation of tax free cars.

Big move to Panama

Retiring to Panama is an upward trend.

With a modern infrastructure and a strong north American cultural influence, Panama offers an easy transition from the West. In the next 10 years in the US alone 75-80 million Baby Boomers will reach retirement age. US Government statistics show that most of them will not be able to sustain their current standard of living by relying on savings, assets or pensions. Moving to Panama will allow them to do that. Some are even opting to retire early.

Interest in Panama does not only come from the United States; many Canadians are heading further south than Florida for their “snowbird” sojourns – and staying for retirement. The increasing cost of living, overcrowding and high crime rates in Florida, encourages them to take a slightly longer flight south! A weekly charter flight from Toronto is now scheduled.

The same trend is appearing in the UK and the rest of Europe too. Leaving the home country and moving to somewhere like Panama is starting to seem like a better idea all the time – especially to a generation that has got used to global travel. Living in a beautiful, warm, friendly, far less stressful environment definitely does have its allure! Living and retiring overseas was once an option available only for the wealthy, it is now an affordable and very real option for people who want a quality of life.

The international mainstream press is also waxing lyrical about Panama, articles in National Geographic, Travel and Leisure, New York Times, LA Times Boston Globe and Harpers Bazaar are stimulating interest with descriptions such as “the most beautiful retreat in the world and almost undiscovered” (Harpers). “Known mostly for its canal, Panama is in fact an undiscovered tourist paradise” (Boston Globe). Articles like these ensure that tourists and retirees are discovering Panama at a fast rate of knots.

Why choose Panama?

So why is Panama gaining in popularity among retirees, investors, and part-time expatriates? Not only because of increased publicity – Panama has more amenities, lower costs and lower crime rates than many other traditional retirement locations. In fact Panama’s advantages are unrivalled. Apart from tax advantages, privacy advantages and a considerable retirement package consider the following:

Panama has a stable government and a growing economy

The US dollar is the legal tender. Panama has a stable economy that has been based upon the U.S. Dollar since 1904

Residents pay no tax on foreign earned income

Foreigners can buy and own property in Panama with the same rights and protections as Panamanians citizens.

Tourism investments have exemptions from import duties, construction materials and equipment, income, real estate taxes, etc.

Property tax exemptions apply to all new construction on a sliding scale according to value

English is widely spoken

The US presence in the country for many years has lead to a US style infrastructure with a number of familiar names and businesses

Panama has a number of US standard health care facilities and services with many US trained English speaking doctors available.

Panama has a reliable communications system with fibre optic telephone lines and much of the country has ADSL internet

Panama is one of the best offshore havens in the world

Panama is much cheaper than the US & Europe

The cost of living in Panama is lower than the US and much lower than Western Europe. For example, electricity costs approximately 10-12 cents per kilowatt hour depending on the area, water and trash collection around $7 per month. Direct TV with a wide choice of English language channels is approximately $50 per month.

Locally produced vegetables, meat and fish are priced considerably lower than in the USA although imported items may be slightly higher. The minimum wage for housemaids or gardeners is 88 cents per hour (I’ll have three of those please!!). Local beer at the supermarket costs 30 cents per can, a coffee in a restaurant may be as little as 30 cents.

By retiring in Panama, you will enjoy the benefits of a developing economy where you can still take a taxi across town for a buck or two, get your haircut for a couple of dollars, or enjoy dinner for two with a bottle of wine at one of the fines restaurants in Panama City for a mere $30.

Comparing Panama to other Countries

Panama has one of the lowest costs of living in all Central and South America. Colombia is cheaper if you don’t mind being an occasional kidnap or robbery victim. Actually many legitimate Colombians have moved to Panama and are setting up businesses here. Honduras is cheaper but there is no infrastructure for medical, phones, internet etc.

Ecuador has little infrastructure but it sure is cheap. Belize isn’t so cheap and has little infrastructure. Costa Rica is not really cheaper and has a serious crime problem plus there are no longer benefits for Expats and you would have to pay income tax on your offshore income like retirement, social security etc in Costa Rica.

Mexico has a serious crime problem with drug gangs executing mayors and police chiefs their first day in office and kidnappings are common. It is debatable if Mexico is cheaper than Panama but they do tax offshore income in Mexico so it is probably more expensive for this reason alone and the crime situation makes it hazardous. You could find some safe areas in rural Mexico but then you have no infrastructure like internet, phones, cell phones, good highways, medical, good water, etc.

So that brings us back to Panama which is the only country that seems to have it all – no taxes on offshore income, extremely low crime (lowest crime rate in Latin America), great food (not good, great), very good internet at USA prices, good phones, good cell phones, cable and satellite TV, friendly people, the ability to buy just about anything you can buy in the USA probably for the same price or less, many consumer goods at a fraction of the USA prices, nice climate, 2.5 hours by plane to Miami and so forth.

Health care for retirees in Panama

Health care is also both inexpensive and modern. Many people considering a retirement in Panama worry about the quality of health care, but such worries are unfounded here. Good-quality health care and modern hospitals are available throughout the country. Many Panamanian doctors are U.S.-trained, and hospital standards are on par with what you would find in North America or Europe. Particularly appealing to those looking to retire in Panama is an important additional advantage: both private health insurance and prescription drugs are readily available and much less expensive than their U.S. equivalents.

Panama is a good investment too…

Now is the perfect time to invest in Panama. The economy is gaining strength in every sector, not just in tourism and real estate. The new administration, under President Martin Torrijos, elected on May 1st 2004 with a strong popular majority, has the momentum to carry out measures to promote growth. The plans to enlarge the Panama Canal, and participate in additional free trade associations, will stimulate the economy still further. Panama’s Colon Free Trade Zone (CFZ), established in 1953, is the largest in the Western Hemisphere and contributes substantially to the country’s economy.

Panama has consistently maintained one of Central America’s highest per capita gross domestic product. The U.S.A. is still the largest user of the Canal and Panama’s foremost trading partner, central banker and is influential regarding its monetary policy.

To encourage long term foreign investment, Panama does not require special permits, authorization or registration to qualify investors. The 1998 Investment Stability Law protects foreign investors for ten years following the registration of an investment, shielding them from changes in tax, customs duties, municipal and labor laws.

Major companies doing business in Panama include Federal Express, DHL, PriceSmart/Costco, Marriott Hotels, Holiday Inn, Sheraton Hotels, Kansas City Southern Railways, Continental, Delta and American Airlines, Warranty Company of the Americas and Hutchison Whampoa, to name but a few. Like it or not you will find just about every US franchise on the streets of the larger cities from McDonalds, Dominos, KFC, Pizza Hut, TGIF to Dunkin Donuts etc; Luxury clothing lines such as Nautica and Liz Claiborne also have stores in Panama City.

Over 80 banks have full service branches here including HSBC, Scotiabank, Dresdner, BNP/Paribas; there are no “brass plate” banks here. Panama is a growing international financial center with good communications and first world amenities.

For more on setting up a business in Panama click here

Where to buy a home in Panama?

Panama currently has an undervalued real estate market; however as has happened in countries like Costa Rica, Mexico and Ireland, prices are beginning to rise as more people discover the advantages Panama has to offer. As a potential real estate investor there are several areas to consider where you will find maximum growth opportunities. Each area has its own special charm and attributes too, depending on what floats your boat!

Panama City

Panama City is an affordable cosmopolitan location for those who prefer city life but fancy a rain forest within the city limits! With a 21st century skyline the high rise buildings tower above the ocean and forest. High class restaurants, first class hotels and fast food outlets, are here for all tastes and pockets.

There are two main real estate opportunities here. Beautiful apartments with fantastic ocean views are available in price ranges to suit all pockets. Many have the use of a pool, spa and children’s play areas. You can still find apartments for less than $150,000.00 but be sure to check out the location before you buy, as in all big cities some areas have advantages or disadvantages that are not immediately apparent to a newcomer.

The jewel of Panama City is Casco Viejo. Don’t be dismayed that many of the buildings are in disrepair, look closer and you will see many remnants of French and Spanish colonial architecture; some properties are gradually being rescued and have become restaurants, bars, studios and small hotels in an area that could well become another New York City Soho. The Presidential Palace and the National Theater are located here as well as a monument to the French who made the first attempt to build a canal.

Purchase and restoration of properties in this area receive incentives from the government in the form of tax exemptions and discounted mortgages. Even your rent is tax deductible expense. In a few years this could be one of the most sought after parts of the city. From apartments to palaces the opportunities are limitless.

For information more on Panama City visit our Panama City Page

Boquete

Boquete in the Chiriqui Highlands has a perfect spring-like climate at an elevation of a little over 3000 ft., with clean air, clear water and a friendly community. On the lush green hillsides gourmet coffee is grown and at times the smell of roasting coffee sends wonderful aromas through the town. If you love Colorado , Oregon or British Colombia, you will love Boquete. The cost of property here can vary enormously depending on the location and availability of access and utility supplies. There are few completed homes for sale and the rental market is one of demand rather than supply. Rental property is a good investment here.

For more on Boquete visit our Boquete Page

Bocas del Toro

Bocas del Toro is one of the last affordable pieces of heaven left in the Caribbean , and the archipelago of Bocas del Toro is stunning. Palm fringed islands, white sand beaches, in fact Bocas has everything you ever imagined for the picture perfect tropical retreat to hang your hammock. The real estate opportunities for beach front properties, teak plantations, and island hideaways are here in abundance. Caribbean beach front property at prices that are still affordable is too good an opportunity to dismiss. Lots here start as low as $32,000.

Other Areas of Panama Suitable for Retirement – The Pacific Coast

Just one and a half hours from Panama City on the Pacific coast is Coronado. This is the first gated community created in Panama and is well established with individual private homes set in their own gardens. They range from 9 bedroom mansions on the beach for $3m to very pleasant 3 to 4 bedroom homes on one or to levels for $300,000. There is some new condo high-rises currently being built on the beach here for around $350,000 for a three bedroom unit with incredible mountain and sea views. Just after Coronado is Punto Barko which is an area of mostly very up-market private homes on large lots. It is wonderfully quiet and beautiful here.

Just a few kilometers further on is Costa Esmeralda, another gated community again with privately built low-rise homes mostly set within large lots. As an example of price there is a large Mexican villa for sale here for $850,000. It has a main house with three bedrooms and three guest houses with one or two bedrooms each as well as a staff house set within 4000m2.One bay further down the coast is the fabulous new development Rio del Mar. A High-rise resort in a beautiful location.