Apart from the city of Colon, Panama is one of the safest countries in Central and South America. The most prevalent crime is petty theft encountered mainly in some parts of Panama City.Panama's countryside, and especially the Azuero Peninsula, crime is almost non-existent. Capital crime rates are very low, far better than you might encounter in New York, Los Angeles, London or any large urban center.Police are generally courteous to foreigners and, in most cases can be counted on to act should a crime be reported.
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Yes, Panama has had a Constitutional Democracy since 1972. The government has three branches, the Executive, Legislative and Judicial. Elections are by popular vote, held every five years. Martin Torrijos is currently the President, serving as both the chief of state and the head of government. Along with her chosen cabinet, she is also assisted by First and Second Vice Presidents. The legislature, made up of 72 members, is chosen by the people from nine political parties. There is a Supreme Court with nine judges who are appointed for ten year terms.
The Panamanian Constitution was amended in 1990 (following the capture and fall of Noriega) abolishing the armed forces.They were replaced by the Fuerza Publica (Public Force) made up of the National Police, Maritime Service, and Air Service. The large number of multinational companies doing business here testifies to the confidence the international community has in the stability of Panama, the “Hong Kong of the West."
Generally speaking, Panama has one of the most stable and strong democracies in Latin American.
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Essentially the U.S. dollar is the money of choice throughout Panama which mints only coinage, known as the Balboa. Businesses, resorts and hotels in metropolitan areas accept nearly every major credit card. You may use travelers checks but, if cashing them at a bank, be prepared to pay a hefty fee. It’s always a good idea to carry a small amount of U.S. bills, in low denominations, for tips and spur of the moment purchases.
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Expect top medical service on a par with the United States or Europe, where many of the doctors have been trained. The urban centers of Panama City and David offer excellent treatment, some even honoring selected U.S and European insurance policies. But don’t expect to pay U.S. prices. An office visit to a doctor may be as low as $10. On the high side, a private hospital stay might run you only $1500, and that includes everything. Expect the same level of professional care for dental needs, but pay only about one-third the U.S. or European cost. For smaller medical necessities, each province provides state health centers and hospitals, as well as private clinics in every major provincial city.
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Continental and American Airlines have direct (non-stop) service from Miami, Houston, Newark and Atlanta. Many international carriers offer flights to Panama from the Caribbean, South and Central America, and Europe. A new port has been built catering to cruise ships, Carnival being one of the major lines currently visiting this fascinating country. Cruise ship activity is on the upswing, additional companies are increasingly adding Panama to their itineraries.
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Panama has two climates-the lowlands including Panama City which are tropical and humid and the highlands which have spring-like temperatures year round.In the lowlands, temperatures during the day range between 80 F and 90 degrees Fareinheit (25-30 degrees Celsius). It cools off in the evenings which are invariably pleasant. In the Highlands the day range is between 45F and 85F.Panama has two seasons - the "dry" season and the "green" season. The dry season is from mid-December until May and green season from May until December. "Dry" means it rarely rains and the green season means typically a refreshing tropical shower late each afternoon. It rarely rains all day, which means that rain is no obstacle to tourism activities. The exception to this rule is Bocas del Toro, where it does rain all day from time to time and occasionally in the Highlands as well.
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Buying Panama real estate is very safe. There are over a dozen laws in Panama established specifically for protecting foreign investments, not to mention that private Panama real estate is protected by the constitution of the Republic of Panama. Thousands of foreigners own property in Panama.More over, it is legal for foreigners to own titled property in Panama in their personal names, although we normally recommend that clients hold all Panama real estate in the name of a Panamanian corporation for asset protection and income tax reasons. Panama "possession rights" (as opposed to titled) property, however, should always be held in the name of a Panamanian corporation, where the foreign person is the shareholder (or a Panama private interest foundation or trust can be appointed as the shareholder in place of the foreign person) of the corporation.More information on Panamanian corporations.
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The Panamanian government charges a 2% property title transfer tax. The 2% is based on the registered value (the value established in the registered deed of sale). In addition, there are other fees charged by the Public Notary and the Public Registry which total in the range of $200 to $300 for registering a buy/sell contract for the sale of real estate in Panama.More info on Panama taxes.
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Under Panamanian law, the seller pays for the title transfer tax, however, in some cases, depending on the negotiation between the buyer and seller, the seller may insist that the buyer pay the title transfer taxes.
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Generally, each party pays for their own closing costs. For example, the seller pays his/her attorney to review the buy/sell contract, and the buyer pays his/her attorney for drafting the buy/sell contract, doing the title search, title transfer, and escrow services. However, in some cases, buyers and sellers negotiate special terms whereby the buyer or the seller pays all closing costs, so it really depends on the particular negotiation between buyer and seller.
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It takes from 1 to 3 weeks, depending on the volume of transactions at the Public Registry.
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Escrow services are relatively new to Panama, so Panamanians are not very familiar with the term "escrow", although it is quickly becoming a standard for Panama real estate transactions nationwide with more and more Panamanian real estate brokers selling to foreigners who are accustomed to using escrow companies in property transactions. Your Panama real estate agent should be able to point out escrow companies in Panama. Traditionally, banks in Panama act as escrow offering Irrevocable Payment Letters payable upon closing.More info on escrow vs Irrevocable Payment Letters
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Despite a false popular belief, the law does not require a buy/sell contract to be in Spanish to be legally enforceable, however, if there is ever a dispute over the transaction in a court of law in the Republic of Panama, then the court will require that the contract be translated to the Spanish language by an official (licensed) translator of that language.
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Panama real estate law does not specify a minimum or maximum down payment for all Panama real estate transactions.Generally, sellers will accept 10% as a down payment upon signing the promise to buy/sell contract. The down payment is shown as "good faith" on behalf of the buyer, so that the seller knows that the buyer is serious. However, the down payment really depends on the particular transaction and the negotiation that takes place. In some cases, sellers will demand as much as 50%, and in other cases, sellers will ask for as little as 5% or less.
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One buy options on property in Panama. However, most Panama real estate sellers do not understand the concept of options on property, therefore, it requires that one must then educate the seller in this concept so that they agree to offering an option to purchase their Panama property.
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It is not necessary to have a local address to open a bank account. All you really need is your passport, 2 reference letters from financial institutions that you have dealt with for several years (only one with some banks), a person to refer you and the money to open it with. Most accounts can be opened with $500 but some banks ask for $1000.
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Detailed info on how to get a mortgage from a Panamanian Bank
Summary:
Thanks to the increased demand the process of obtaining a mortgage loan for foreigners has been simplified over the years. The actual process of applying for a mortgage requires that a client provides documents proving who they are, their credit status and the total income and assets that they have. But every bank will have a specific list of requirements, but basically the more you show the banks the easier it is for them to understand the risk involved. The basic documentation that you need if you live outside of panama is:
- Legible copies of your passport
- Letter from your employer if you are not self employed
- The last two years of tax returns
- Bank reference letters
- Bank statements from all existing accounts for the last six months
- Government issued I.D.
- Business and personal reference letters
- Purchase contract
- Completed and signed application form
Banks in Panama are very conservative and they ask you for a lot of things in order to give out a mortgage. With all the things that are happening in the world, things are starting to slow down in Panama, but I don’t think that we are going to suffer like the the US because there has been more controls and regulation.
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ALL VISITORS require a VALID PASPORT and an ONWARD/RETURN TICKET.
Additional requirements vary according to nationality and are subject to change. Citizens from certain countries need a tourist card, others need an authorized visa and others do not need anything. To know if you require a visa depending on your nationality please click here. You are recommended to check with a Panamanian Consulate, Embassy or ticketing agents for airlines that fly to Panama to obtain the most updated and accurate information.
In practice, the ticket requirement is mainly for those who enter Panama by bus or by boat.
If you are flying into Panama the most probable scenario is that you will not be asked to show a return ticket and in case you are, be sure to at least have a return ticket valid within 1 year of entering the country. If you plan to be in Panama for more than 90 days, then it is likely that you will be applying for some type of visa after entering the country and the authorities may have a few questions about your intentions. In this case you should be able to explain your plans and then allowed to enter the country after correctly informing the authorities about what you want to do.
If you enter Panama by bus or by boat you will have to purchase a return ticket by land or by water because the authorities may ask for it and if you do not have it you will run into unnecessary trouble and you will end up buying it anyways. If you expect to leave the country in a different way then the way that you plan to enter Panama and you still do not have that return ticket, then our advice is that you purchase any return ticket. For example, if you enter Panama through Costa Rica by bus, but plan to leave by plane and you still have not bought that ticket, then just buy the cheap bus ticket: it will only cost you $10 and you will avoid any unpleasant situation.
For more information on different types of VISA'a and other Panama Immigration issues, visit our Panama VISAs and Panama Immigration
page.
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If you can enter the country without a visa, you certainly do not need a Tourist Card. A tourist card is basically a piece of paper or a simple form that you fill out and purchase for only $5. No worries, if you are entitled to a tourist card no one will say no unless you are a wanted criminal!
Nationals from the following countries DO REQUIRE a tourist card (US $5), available from Panamanian embassies and consulates, airlines serving Panama, border crossings, or at the international airport: Antigua, Australia, Bahamas, Barbados, Belize, Bermuda, Bolivia, Brazil, Canada, Chile, China, Colombia, Denmark, Granada, Greece, Guyana, Iceland, Ireland, Jamaica, Japan, Malta, Mexico, Monaco, Netherlands, New Zealand, San Marino, South Korea, Suriname, Taiwan, Tobago, Trinidad, USA, Venezuela. In other words, if you are on this list, do not bother going to a consulate or embassy to get a tourist card: once you are on your flight you will probably be given one and if not, when you land on Tocumen Airport you will be able to purchase one before going through immigration.
Nationals from Chad, Ecuador, Egypt, Philippines, Perú, Dominican Republic and Thailand require tourist visas and should contact an embassy or consulate before coming to Panama.
The law reducing the term of the tourist card to 30 days is still on the books BUT the immigration authority enforcement division has informed us that the policy since 1/1/08 is to allow citizens from U.S.A. and Canada a 90 days Tourist Card just like before, in other words, the same amount of time as those citizens who do not require a visa or a tourist card. Citizens from all other countries that enter Panama with a tourist card are only entitled to stay for a maximum of 30 days unless they request an extension.
Citizens from these countries can apply for an extension for up to another 30, 60 or 90 days. Petitions are approved or denied on a case-by-case basis. Immigration recommends you apply at least a week before your time is up.
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Ship from any shipping company in the USA,Canada or Europe, Panama is a close and convenient port. Most people can put all their household goods in one 40 foot container. This can be loaded right in front of your house in the States and brought to the front of your house in Panama.There are no import taxes on importation of your household goods. ( There is some rule that there is no tax on up to $10,000.00 worth of household goods but no one is going to be able to say exactly how much all your used household goods are worth, so not to worry.) For your car, it can be put in your container or shipped separately. Whether you are a Retiree or not, taxes will apply for your car.
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No problem. Prices are comparable to US prices, but don't expect sales. At Furniture City in Panama and David you can order from extensive US furniture catalogs if you don't find what you like on the floor. There are also a number of upscale furniture stores in Panama City. Banyan Leaf in Panama City has a magnificent selection of both Oriental and Western furniture and accessories.For appliances, Raenco and Do-It Center in Panama City are excellent. Price Costco in Panama City and David also has some good deals, but a limited selection.
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The best way at this time to work in Panama is to set up your own business. To get a job at a Panamanian business is very difficult because of Panamanian Labour Law limiting foreign employees. There are even specific laws forbidding for example foreign lawyers, doctors, translators, university professors etc. to work in Panama. These laws will most probably be modified as Panama's booming economy needs more skilled persons, but for now it is the reality.
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Law 21 of 2008 to extend the number of projects with a 20-year property tax exemption was finally enacted and is in force.Law 21 still does not clarify which exemption applies to homes with building permits dated between September 1, 2006 and June 30, 2009.
To qualify for this exemption:
a) the BUILDING permit has been issued before July 1, 2009, AND
b) the REGISTRATION of improvements in the Public Registry is completed BEFORE December 31, 2011.
More information on property tax exemption in Panama
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Here are the necessary steps to registering your property in Panama:
- Obtain a non-encumbrance certificate at the Public Registry Office.This takes aproxinately 2 to 3 days to complete and is worth $30. You must first obtain a certificate of non-mortgage and non-litigation before starting this transaction. This certificate is obtained at the Public Registry Office and is done in conjuction with the next step
- Obtain a certificate of good standing from the General Cadastral Office.The seller must obtain a certificate of good standing with the cadastral value from the General Revenue Directorate, which relates to the property tax to be paid by owners. This certificate can be requested by any third party interested, and must have the lot number and the page number (document number), issued by the Public Registry Office. Note that land with a value under $30,000 is property tax exempt. Property Tax may increase as high as 2.10% annually based on the cadastral value. This step takes 15 days to complete and costs $5.
- A lawyer prepares the sale agreement.A lawyer usually prepares the sale agreement (it can also be prepared by a real estate broker). In any case, the sale agreement (contrato de compra y venta) needs to be stamped by a Panamanian lawyer prior to being executed in a public deed. The sale agreement should mention that there are no mortgages or limitations on the property. The documentation shall include the Non-encumbrance certificate (obtained in step one). This step takes 2-3 days and the cost varies according to lawyers fees, with a minimum being $200.
- Payment of the Transfer and Capital Gains Taxes.Prior to filing and recording the public deed at the Public Registry Office,the Transfer Tax should be paid (if it’s not exempt by any particular reason established by law) at the Ministry of Economics and Finance, by the seller. Transfer tax: 2% of the price of the transaction or the cadastral value, whichever is higher. There is no VAT in Panama for transfers of property.As of 7/2006, at this time the seller must also pay 10% capital gains tax, regardless of how long he has owned the property. This step takes 2 days to complete.
- Notarization of the sale agreement and preparation of the public deed.The notary notarizes the sale agreement and prepares the public deed. All transfers of property must be notarized or made into a public deed before filing for recording at the Public Registry Office. The documentation shall include: Sale agreement (step three).Receipt of payment of the transfer tax (step four)Certificate of good standing with the cadastre (step two)Good standing certificate with water utility services (IDAAN Paz y Salvo) to show that payments are up to date. This step takes two days and costs $100.
- The public deed is filed and recorded at the Public Registry Office under the name of the buyer.The public deed is filed and recorded at the Public Registry Office under the name of the buyer. The registration fee is paid at the National Bank in favor of the Public Registry Office. The bank has a branch inside the registry office. Since 1999, there has been an optional expedited procedure in which one can obtain registration within 24 hours, at an additional cost of $250 though not many people choose it because it is rather expensive.The documentation shall include: the notarized public deed (step five).Time to complete:7-10 days.Cost to complete: 0.25% of property price (registration fee) + $5 for filing + $10 for analyzing the document
- A copy of the recorded deed is filed at the Cadastral Office to record the new buyer and the new value for tax purposes.A copy of the recorded deed should be filed at the Cadastral Office to record the new buyer for tax purposes as the new person responsible for the payment of the property tax. This should be an internal procedure after Procedure 6, but in fact, the buyer needs to do it in person so far. The buyer picks up the certificate of good standing with the new name and value at the end of the 2 weeks.Time to complete:15 days.Cost to complete:no cost
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