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COSTA RICA REAL ESTATE TROPIC Real Estate www.tropic realestate.com
Buying Property in Panama
With Panama becoming increasingly popular as a retiree’s haven, this article provides a guide on how to buy property in Panama along with the do’s and don’ts.
The property in Panama can be classified into 3 categories: Government property, squatter property and titled property. The government property is largely in remote places and jungles. Squatters illegally occupy government land and claim ownership after many years. Squatter property may not have proper titles, as the legal rights may be granted only several years of occupation. Titled properties are those whose ownership is recorded in the National Registry. It is the only property that a visitor should buy.
Regarding choosing a location Chriqui province and the province of Bocas del Toro are ideal places to buy property. The towns of Boquete and Volcan in Chirqui province are American friendly and are only an hour’s drive from Costa Rican border. The islands of Bocas del Toro also lie close to Costa Rica and are favorite destination of Americans.
Weather is an important consideration while choosing a place to settle down and Bocas del Toro has typical Carribean tropical weather. It is warm and humid in summer with sea breeze and light rains from August through January. Volcan is in an elevated location and the weather is usually cool with a prolonged rainy season. Boquete is also situated in Panama’s highlands and the air is dry and crisp and one may need a sweater. Because of the elevated terrain, both these places are surrounded by colorful flora all year round.
Buying a property in Panama is relatively easy and there are property laws in place that fully protect the rights of a foreign owner just like the locals. You can buy and sell property any time you like and fully repatriate the proceeds with you. A lawyer’s assistance is usually not required if you have done proper research and you can save lawyer’s fees of around $500. The property tax laws are investor friendly; you can claim exemption from taxes for 20 years when building a house.
After choosing a property and deciding on the price, you have to inspect the title, whether it is the name of the seller or not. You can also request a title search from the registration office to find out if they are any liens or other legal complications with the property. The title must be original with the stamp of the registration office. A ‘bill of sale’ has to be finalized next for sales tax purposes and the value is usually declared less than $20,000, irrespective of actual transaction value, not only to save on sales tax but also to claim property tax exemption. The new title has to be notarized next who types out all the details of the property and sends it to Chief Notary’s office for approval. The transaction value is then paid through check on a local bank after transferring funds from abroad. The final step in the property transaction is registration of the deal with the National Registry.
Rovercam Clips – Hermosa Costa Rica – June 2007
