Panamainfo’s Blog

Dealing in banks in Panama is not a favorite activity for foreign residents.  But good news: there is one bank that excels at serving the foreign resident community. Many years ago a board member at the American Chamber of Commerce recommended Scotia Bank to us.  Shortly thereafter we opened a savings account and  got a home mortgage from Scotia.   I did not consider putting my bank accounts because their one Panama City  branch was far from where we lived.  But Scotia recently opened a branch near where we live. I am now switching 3 of our checking accounts  to Scotia. I made this decision after having one too many problems with my current bank and not wanting to stand in long lines anymore.

It has been a pleasure to open up these accounts at Scotia. They were geniunely happy to have my business, the personnel was competent and helpful. I speak Spanish but they were ready and willing to speak to me in English if necessary. I was able to set up my new bank account in less than a week with no hassles whatsoever.

Scotia was recently named “One of the top 10 most stable banks in the world” according to the Toronto Financial Post. It’ growing by leaps and bounds in a number of Latin American countries like Mexico. In Panama, Scotia has several branches in Panama City and also one in Boquete.

Scotia accounts can of course be seen online but it will be another year before you can make utility and other payments from your Scotia Bank online account, so I am keeping one account in my old bank until this service is offered. I am told that Scotia will offer credit cards in a year as well.

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Why Buy Real Estate in Panama?

Because Panama a Safe Haven in Uncertain Times

Who is investing in Panama these days? Smart money. Panama has seen an increase of wealthy investors looking for a both a safe place for their investments and a place of secondary residence.

In an April 2009 article in New York Times, Sam Taliaferro, an American developer in Panama  said

“We’ve certainly seen a slow down in for homes in the $200,000 range.  But we’ve seen a pickup in another market. The market we’re seeing now is a market of wealthy individuals who are looking for safety. They’re looking for a safe haven. They want to park their assets somewhere else because they see a train coming down the tracks.

They’re also looking for what would be a second home that will become a primary home. They’ll make this their primary home and be a resident outside the country and maybe keep a home in the United States or wherever they’re from.” 

Real estate investments in Panama carry risk but not in comparison to the risks of the US stock market. US stock market returns averaged just 3% in the last decade- before this current market meltdown when most gains were wiped out. 

One cautionary note is the Panama City condo market which everyone agrees is way overbuilt and in a major slump. But that means it is close to time to begin picking up some bargains.

Panama is attractive for investment because while it is an emerging market it is also a proven market. It has has the highest growth rate in Latin America in the last 5 years. Today it is one of the few economies that is still growing- most experts say it will grow at least 3% in 2009.

Why is Panama doing well and will continue to do well?  To start there are  numerous major infrastructure projects in the works including the 5 billion dollar expansion of the Panama Canal, oil pipelines, a major special economic zone, port expansions and hydroelectric plants. Panama is also fast becoming the business capital of the Latin American and Caribbean  region. 17 major international corporations have recently made their regional headquarters in Panama including, Proctor and Gamble, Caterpillar, Dell, Hewitt Packard and 3M. ( Miami  was the defacto capital until 9-11 which means companies can longer get US visas with any consistency.

The strong Panamanian business sector including an international banking sector of over 100 banks, is solid having not made the mistakes of its of the banks up North.

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Last weekend I had the opportunity to visit the Cielo Paraiso Residential and Golf community just outside the town of Boquete to see the progress they have made. I was quite impressed. Cielo Paraiso is set on  300 hectares of beautiful natural settings of soft rolling hills with majestic mountain surroundings. A number of handsome homes are already  now buil. Tthe owners, Canadians Radeep and Colleen Lal tell me 60% of the first phase is sole.  I toured  several homes and met the happy residents.  The homes are beautifully crafted with all the latest things including one home what had a pizza oven in its chimney. Each luxury home has a large terrace with vast mountain views -you can even see the Pacific Ocean. The temperature is so perfect that no one needs air conditioning.   Homesites are large for maximum  privacy, serenity, and comfort.

The day I visited  they were celebrating the soft opening of the first 9 holes of their golf course and the club house.  The golf course has a rolling course with ponds, and amazing 365 degree views of mountains and even the Pacific Ocean.   The next 9 holes will open in the next 6 months- this championship course  is designed by J. Michael Poellot. Cielo Paraiso owners envisioned a  Paradise where residents could feel surrounded by and  close to nature and  enjoy a luxury home and total safety. Congrats to Cielo Paraiso  because this is what they have already accomplished.

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