'Future Building Boom Bust' Retirement

fvansan from pa (Contact Member) -

I will reach retirement in 2016 and, at that time, I will qualify for full-Social Security benefits to supplement my smallish retirement savings. I have started researching warm weather locations to retire to, including Panama. Most of the retirement articles about Panama I suspect are written by the people who have some financial gain in attracting real estate money to Panama, which I don’t fault at all.

I was in Panama a few weeks after the US Noriega invasion. From the photos I see now of Panama City, the building boom has dramatically changed the shore and skyline. I have read that there are 50, 000 units being built in Panama City and only 8, 000 of them are completed. It is predicted the other units will be completed perhaps by 2009-2011, and probably longer since steel is in such high demand throughout the world.

Currently, I do not have the funds to purchase Panama property. I am thinking that while real estate in Panama has appreciated over the years, that when the building of new units has come to completion, there will be a bust in housing as there will be too many investors trying to sell to too few buyers. Now I also recognize there are a lot of Europeans who will take advantage of the dollar’s decline and purchase many of these properties, but I still predict the prices will fall. I don’t claim to predict the future of the American economy or the value of the dollar, however, I do suspect we are close to bottoming out and with the right political change in America and greater fiscal management of the budget; the dollar will increase in value.

My point is does anyone else predict the price of housing in Panama will be declining in the future due to over supply, especially in Panama City? Of course, pre-construction investors will disagree as agreeing so is a not in their best interests. I’m seeking feedback from those retirees who are currently living in Panama or people with perhaps a deeper knowledge of this than I have.

Thank you.

Comment #1 Dar (167.80.246.204) -

I think it all has to do with the area you are thinking about investing in. Yes I do believe that Panama City will slow down. But as long as Social Security in America continues to decline in value with regards to going into bankruptcy and health care continues to rise, it will not be affordable to retire in this country. It is predicted that the average premium for health care in 8 to 10 yrs will be $1, 000. per month per person. With even the slight possiblity of that happening we are not going to see many retirees staying in the old USofA. Don't get me wrong, I love my country, it's just not affordable to live during retirement. With that being said. We just got back from Panama, went to see if it would be some place we might like to retire. Panama City was way to hectic so we rented a car and drove up the PanAmerican Hwy. Ending up in Boquete. Fell in love and bought a lot and will start building our retirement home. The David and Boquete area prices are going up, with no end in sight, due to all the advantages of Expats. Do your homework and Google, Retirement in Panama and anything else you can think of to Google regarding living in Panama.

Panama was rated as one of the top 5 places in the world for babyboomers to retire. Travel Mag rated it top 3 places in the world to retire. And International Travel rated it in the top 3 places. The health care in that country is fantasic and cheap. Do your research and you will be surprised. I would not wait to invest or buy in Panama. I really don't think it is going to get any cheaper. We have no vested interest other than we purchased a lot and are going to start building.

There is lots of Panama books, check out on internet.

Comment #2 fvansan from pa (Contact Member) -

Thanks for your post. Currently, I do not have the funds to purchase in Panama. I also do not envision medical insurance going to $1000/month. I have greater hope that we will end up in a single payer system in the USA which will cut the cost of insurance in half, but, that is another post.

My thoughts was I just predict the boom to bust in Panama City. Thanks and yes, I am spending a lot of time Googling all. There is also some good videos on You Tube too.

Comment #3 Jim from New York (Contact Member) -

Keep feasting on junk food (all the prepackaged stuff) instead of fresh foods... and you'll see medical insurance hit and surpass $1, 000 as month as the country gets less and less healthy.

The same thing will happen in other countries as they pick up steam on the junk food wagon and retires bring those bad habits with them!

Comment #4 kelly o'droscoll (61.68.10.104) -

Hello

my husband and iwould like information on panama city

as we are retiring in 6yrs and are looking for a comfortable life as retiree's

we live in australia and with our savings and super don't believe we could comfortably live here without working

we would like any information you would have

we would intend on buying a home in panama

what's the medical like

what's the prices of homes

cost of living

where is the safest stop to retire in panama city

Comment #5 kelly o'droscoll (61.68.10.104) -

Hello

My husband and iwould like information on panama city

as we are retiring in 6yrs and are looking for a comfortable life as retiree's.

We live in australia and with our savings and super don't believe we could comfortably live here without working.

We would like any information you would have

we would intend on buying a home in panama what's the cost of a nice home, would $200 buy us a home.

Where is the safest stop to retire in panama city

Comment #6 Dar (167.80.246.204) -

If you like a lot of traffic, Panama City is for you. I suggest you go down and stay in a B&B in the city. I have the name of one we stayed in and loved it. Only $60.00 per night. With a great breakfast and pool. Go on line and look up Boquete, Panama. Let me know if you need the name of the B&B. I check this site once a week.

Comment #7 Hugo Steeds (80.44.177.102) -

Dear all,

To start with, Panama City has developed in a very different way to the rest of the country. Be aware that 50, 000 housing units will take time to complete first of all, then the problem of absorbing 50, 000 extra to a city of little more than a million.

It is completely out of proportion when parts of rural Veraguas will sell for less than $2 per m2. There is NO public transport in the city. Traffic is horrific. Civic infrastructure is limited if not non-existent.

In addition, many of the tower blocks being built have less than 20% occupancy levels when finished. Values are speculated on, and the re-sale market will affect values when there becomes a surplus of housing stock, combined with very little investment in civic infrastructure projects.

As the Economist observes, this real estate boom in Panama will have to come to terms with real social and institutional reform. If the wealthy keep polarising an increasing number of those below the poverty line. This will ignite a highly militarised and politicised society. The city needs a public transport system for a start and real socio-economic reform.

Hot spots like La Valle and Boquete are much more controlled and not likely to suffer a massive over-supply of housing stock.

Hugo

Comment #8 fvansan from pa (Contact Member) -

Thanks Hugo for your insightful reply. I hope this post gathers more interest as well as many are placing their financial hopes on a boom in Panama City. I suspect the Economist is right about the poor reaching a point where they will be very willing to accept and support a more socialist type leader (Chavez type)who will make them many promises.

Comment #9 Martin (63.176.159.23) -

Why worry about the bust? Worry about the price you buy it for and the return on investment. Do you think the rest of south and central american really want another Chavez?

Comment #10 Jan de Vong (190.2.229.196) -

My wife and I moved in Panama 2 months ago and we are so happy we did it, particularly when we see how the situation in North America and Europe is evolving. The cost of living in Panama is very affordable, I would say about 35% cheaper than Canada where we are from. We decided we'd rent for a year to get a better idea of how the country is. We are renting a beautiful seafront condo we found on www.yourpanamacondo.com (they also sell beautiful condos) and we are close to everything, from supermarkets, malls, hospitals, etc. We haven't bought a vehicle yet but will do so next month (taxi rides are so cheap). We currently live in a part called san Francisco which is close from the airport. We go to the beaches of Coronado and Playa Blanca twice a month and pay golf once a month. I'll be happy to post our experience here in Panama as time goes on.

Comment #11 Jim from New York (Contact Member) -

I found that any taxi ride from the Airport to Panama City ran about US$27.50. Not exactly cheap.

Comment #12 Fred (63.176.159.238) -

No Jim, thats not cheap. can you rent mopeds or anything?

Comment #13 knut from Panama city, Panama (Contact Member) -

Hi There.

I work for a real estate developer who are now starting a construction in la Guaira, in Carebeean side of Panama.

We are the first one to have a development here.

We also have in boquete, Panama city and many other places.

If you want some free advice on where to buy a holiday home, invest or retire, and you want any more info, let me know, and I get back to you.

My email is knutegila@hotmail.com

Regards

Knut

Comment #14 Tink (63.176.159.238) -

Here are some relevant information that i got about Panama:

Prices in Panama tend to be slightly higher than in other parts of Central America, such as Guatemala and Nicaragua, though they are about on par with Costa Rica.

Throughout the country, you can get a budget hotel room for about US$15 to US$20 a night, while die-hard shoestring travelers can probably find some questionable digs for about US$10. In recent years a number of backpacker-friendly hostels have popped up around the country, particularly in Panama City, Bocas del Toro and Boquete – a dorm bed at any of these places will set you back less than US$10 a night.

Good, inexpensive food isn’t hard to come by. You can eat comida corriente (set meals) at Panamanian restaurants for about US$2 to US$4 no matter where you are in the country. Buses and taxis are also reasonable – a two-hour bus ride costs a few dollars, while a cab ride in the capital costs the same. All in all, if you’re traveling frugally, it’s possible to get by on US$20 to US$30 a day in Panama.

• www.lonelyplanet.com/panama

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