FREQUENTLY ASKED QUESTIONS
IS IT SAFE FOR FOREIGNERS TO BUY PROPERTY IN PANAMA?
Absolutely. Buy property in Panama is very safe. There are more than a dozen laws in Panama established specifically to protect foreign investment. Private property in Panama is protected by Republic Constitution. Thousands of foreigners own property in Panama. Real Estate TDI processes transactions real estate foreigners in Panama daily without any problems.
IS IT LEGAL FOR FOREIGNERS TO BUY PROPERTY IN PANAMA?
Yes, it is legal for foreigners to buy titled properties in Panama to own name.
HOW TO REGISTER THE PROPERTIES ON THEIR OWN BEHALF OR ON BEHALF OF SOCIETIES?
It is recommended that the property be maintained on behalf of a Panamanian corporation for asset protection and for reasons of income tax. In Panama, the ownership rights of possession (unlike the title) should always be in the name of a Panamanian corporation, where the foreign person is the shareholder of the company (a foundation or a trust can be named as shareholders instead of the foreign person).
WHAT ARE PROCEDURES FOR PURCHASING REAL ESTATE IN PANAMA?
- First, find a property in Panama that you enjoy and negotiate the price and terms of sale with seller (or Real Estate broker in Panama).
- Second, you should seek a qualified attorney in Panama, to manage the process, due diligence of property title. Followed should contact your attorney with the seller (or Real Estate broker) to get property documents copies and conduct documentary research (if available).
- Third, the lawyer must prepare a Promise to Purchase / Sale contract to close the sale of the property and ensure the agreed terms (a deposit of 10% is usually required at the time of signing the promise to buy / sell) also it gives you time to perform due diligence and record the funds in an escrow account.
- Fourth, once the lawyer has confirmed that the property is free, then the final closing is scheduled, where the buyer / seller signs the Final Contract Purchase / Sale.
- Fifth, the payment is made to the seller, broker and attorney from escrow account (in some cases buyers / sellers agree that payment will be made after the public deed of the property is transferred and registered in the name of the buyer).
- Sixth, the Purchase / Sale is recorded in the Public Registry where they transfer the title to the former owner to the new.
SHOULD YOU PAY TAX ON THE PURCHASE OF A PROPERTY IN PANAMA?
Article 764 of the Panamenian Tax Code indicates that the buildings are exempt from property tax. These properties include:
- All registered properties worth $ 30,000 or less, including improvements on the land, buildings constructions.
- Land used exclusively for agriculture and registered with the Ministry of Agriculture and Rural Development to less than 150,000 USD.
Your questions are always welcome. We are at your disposal to clear any doubts that presents itself on your best options for buying and selling real estate in Panama, processes residence purchase of buildings or people in retirement. Contact our professionals who are happy to assist you.