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Since 2010 we’ve been offering Panama Relocation Tours 7-night 6-day all-inclusive tours to educate you about relocating to and living in Panama. We’ve helped 1000’s of people relocate to Panama the easy, stress-free way!
We know it’s a big decision to relocation to a different country, or even sign up for a Panama Relocation Tour, so we offer monthly Q&A calls to answer some of your questions about life in Panama.
This is a replay of the October 2019 Retire in Panama Q & A Conference Call. If you have further questions, please email us at [email protected]
Note, during this call, a question came up about getting international health insurance. At 65, I pay $2500 a YEAR for international health insurance which covers me in Panama, in North America or anywhere else in the world.
When I turned 65 this year, I had a big decision to make about getting Medicare in the United States or relying exclusively on my international health insurance. I decided to get the minimum requirements for Medicare. When you get closer to 70 years old, international health insurance is either every expensive ( like $5000 a year) or not available though some insurance carriers. Many international insurance carriers have an age restrictions. Therefore, if you are closer to 70 years old when you relocate to Panama, and are a United States citizen, we recommend that you keep Medicare in the United States and get Panama only health insurance which is super affordable and has no age restriction.
If you drop out of Medicare but later want to move back to the United States, or just use Medicare occasionally, you’ll have to pay a penalty to get back in to the system.
The World Bank publishes a lot of great articles about every country to help you do a comparison. At WorldBank.org you can do research about the economy, government stability, average wages, starting a business and much more.
See the FREE 59-page “Doing Business in 2019” report below.
The World Bank is a vital source of financial and technical assistance to developing countries around the world. They are not a bank in the ordinary sense but a unique partnership to reduce poverty and support development. Established in 1944, the World Bank Group is headquartered in Washington, D.C.
The World Bank provides low-interest loans, zero to low-interest credits, and grants to developing countries. These support a wide array of investments in such areas as education, health, public administration, infrastructure, financial and private sector development, agriculture, and environmental and natural resource management.
They also provide or facilitate financing through trust fund partnerships with bilateral and multilateral donors. Many partners have asked the Bank to help manage initiatives that address needs across a wide range of sectors and developing regions.
The World Bank offers support to developing countries through policy advice, research and analysis, and technical assistance. Our analytical work often underpins World Bank financing and helps inform developing countries’ own investments.
To understand what’s going on in countries, the World Bank does extensive research which they share with you on their website, www.WorldBank.org.
Before you embark on any business or construction in a country, it is a good idea to go to the WorldBank.org website to get a better understanding of what is going on in that country and what the rules are.
HOW TO DO PANAMA RESEARCH
The World Bank has a lot of data about Panama. And they even publish annual reports about a variety of different topics. You should certainly consult with an attorney in Panama to get the rules but it would be a good idea to start with the research provide at the World Bank to avoid getting in to trouble.
In Panama, some things are done in a different way than you are familiar with. A good example are real estate sales and rental listings. In Panama, it’s common to see the same house listed at several different prices with different agents. Sometimes the “spread” can be as much as $100,000 difference for the same house!
In North America, most houses for sale are listed as an exclusive listing. This means that one real estate office as the exclusive right to market the property. If that same office finds a buyer, they will typically make about a 6% commission. If an agent from a different office produces a qualified buyer, the “listing” agent will usually agree to split the 6% commission. In North America, a real estate agent has a fiduciary responsibility to the seller/buyer so all the dealings for the transaction are revealed “on top of the table.”
There are some exclusive listings in Panama too. But most listings are NOT exclusive. Instead, the seller has agreed to pay a commission to whoever produces a qualified buyer. This is why you will see the same house listed with several different office and at different prices. A typical commission in Panama is 5-6% of the sales price.
But sometimes, the seller has told the agent(s) that they need to NET a certain amount at closing and anything the agent can sell it for over that amount will be there profit. This is called a net listing. Net listings are illegal in most of North America, but it is business as usual in Panama. Here’s an example:
Joe and Mary need to walk away with $150,000 on the sale of their property. Real estate agent Sue advertises it for $220,000 – with room for negotiations, she’s hoping it will sell for $200,000 so she can walk away with a $50,000 commission versus the $12,000 commission she would have earned at 6%.
Maybe $200,000 is the right price for the house. But perhaps $150,000 is the right price. It’s hard to know in Panama because there is not a reliable MLS system to show comps of recent sales in the area. We do have an MLS system but most agents don’t use it and that’s why it’s not reliable.
Last year, I had breakfast with the broker for a local real estate office. He was bragging about how me made $600,000 profit on a NET listing near Boquete.
HOW WIDESPREAD IS THE PROBLEM? [Read more…]