IL Postcard
A Little-known Panamanian Law Could Save You Thousands
Date: 01/23/2008
There are still many bargain properties to be found in Panama City...and you may qualify for a low-interest mortgage.
Wednesday, Jan. 23, 2008
Panama City, Panama
Read more about Panama in International Living Postcards—your daily escape
A little-known law in Panama means that you can get financing on your Panama residence at very low interest rates.
The law, due to expire at the end of the year, qualifies buyers of certain homes for mortgage interest rates of 2% to 3%.
Yes, there are conditions. The property must be a new build, your primary residence in Panama, and cost no more than $62,500…although local lobbies have been pushing to increase this to $82,000. The government has previously rejected raising the threshold, but now the minister of housing is promising to back an increase. This is good news for city-dwellers in particular, where it is becoming impossible to find property for less than $62,500.
Looking to live like a local and save as much as possible? Compared with a traditional mortgage (current rates in Panama are 6.75% to 7.25%), this law could save you thousands of dollars in interest over the course of the year, particularly if the threshold is increased.
When I say “live like a local,” I don't mean just living outside a gated community or going without high-end fixtures. Living like a local could entail much smaller living quarters than you're used to…or buying in a middle- or low-class neighborhood in the city, or a slightly nicer neighborhood in the suburbs.
Here are a few properties right in Panama City that would be eligible for preferential interest mortgages under the proposed threshold:
El Mare: Apartments in El Mare start at 656 square feet in size. The building will have a pool, a social area, and views of the Metropolitan Park. Pricing starts at $79,000. Construction on this new building should be complete by the end of the year.
Onix One: I live in the Greater Bethania area—a safe, central location just 10 minutes from the El Dorado shopping area, about five minutes from a large El Rey supermarket, a Super 99 bargain supermarket, and a nice Metro pharmacy. In my neighborhood, a new building called Onix One will feature new apartments varying in size from 839 to 1,237 square feet. Prices start at $66,300.
Jessica Ramesch
The Panama Insider, International Living
P.S. You can read more about this law in this past Panama Alert.
Editor’s note: Learn more about inexpensive property in this month’s edition of Panama Insider. Also in the current issue: find out which new destination is our favorite retirement location for 2008.
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- Why Panama Is Top of Our List