RETIREMENT PROPERTY vs. INVESTMENT PROPERTY A common decision for many people looking to move to Panama is whether to buy an “investment property” or “retirement property.” The terms are often used interchangeably but there is a big difference.
RETIREMENT PROPERTY OR SECOND HOME:
A retirement property can take many forms. It can be a turnkey home; an empty lot ready for a home to be built; a lot in a development with restrictions on what can be built; even a condo or apartment in the city. In all cases there will be water, electricity, roads, and the infrastructure in place for a homeowner to move in or build a new home.
When buying a retirement property you must consider the price that you are paying includes the development costs, i.e. land purchase cost, infrastructure development cost, building cost, plus the salaries for everyone involved (from the lawyers to the bricklayers).
For the absentee owners who want to rent their home when they are away, you can estimate earning about $300-$500 per month.
To make a profit on this type of investment will take a long time and “flipping” is difficult because we are in a buyers market where many home and lot options are available.
Here is a good example of a retirement property http://www.panamacoastproperty.com/beachfront-homes.html (Oceanfront sea side home).
INVESTMENT PROPERTY:
This is characterized as land that will generate a significant profit in relatively short time period. This type of property is not an individual lot, but a parcel of land ideal for building more than one home. It can also be a “land banking” scenario where the price of the property is so cheap that it will undeniably increase over a few years and give a fantastic ROI. In both cases the buyer may have to make some infrastructure improvements and should be careful when calculating cost of improvements vs. the selling price.
In this situation, the investor should realize he may have to do some legwork (there are several quality English speaking firms in the area dedicated to this work), but will take all the profit. Remember, labor costs are cheap in Panama.
Here is an incredible oceanfront investment property example http://www.panamacoastproperty.com/beachfront-homes.html (Rancho Tranquillo). In this situation the investor has the best of worlds, a turnkey home ready to be occupied and an additional 4 lots available for sale with infrastructure in place. All it takes is a motivated seller to recapitalize. Imagine purchasing the property for $350,000 and selling four large oceanfront lots at (you name the price)!
RETIREMENT PROPERTY OR SECOND HOME:
A retirement property can take many forms. It can be a turnkey home; an empty lot ready for a home to be built; a lot in a development with restrictions on what can be built; even a condo or apartment in the city. In all cases there will be water, electricity, roads, and the infrastructure in place for a homeowner to move in or build a new home.
When buying a retirement property you must consider the price that you are paying includes the development costs, i.e. land purchase cost, infrastructure development cost, building cost, plus the salaries for everyone involved (from the lawyers to the bricklayers).
For the absentee owners who want to rent their home when they are away, you can estimate earning about $300-$500 per month.
To make a profit on this type of investment will take a long time and “flipping” is difficult because we are in a buyers market where many home and lot options are available.
Here is a good example of a retirement property http://www.panamacoastproperty.com/beachfront-homes.html (Oceanfront sea side home).
INVESTMENT PROPERTY:
This is characterized as land that will generate a significant profit in relatively short time period. This type of property is not an individual lot, but a parcel of land ideal for building more than one home. It can also be a “land banking” scenario where the price of the property is so cheap that it will undeniably increase over a few years and give a fantastic ROI. In both cases the buyer may have to make some infrastructure improvements and should be careful when calculating cost of improvements vs. the selling price.
In this situation, the investor should realize he may have to do some legwork (there are several quality English speaking firms in the area dedicated to this work), but will take all the profit. Remember, labor costs are cheap in Panama.
Here is an incredible oceanfront investment property example http://www.panamacoastproperty.com/beachfront-homes.html (Rancho Tranquillo). In this situation the investor has the best of worlds, a turnkey home ready to be occupied and an additional 4 lots available for sale with infrastructure in place. All it takes is a motivated seller to recapitalize. Imagine purchasing the property for $350,000 and selling four large oceanfront lots at (you name the price)!
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