The recent announcement that the Panama government is launching a new “golden visa,” offering a permanent residency visa in exchange for an investment in the country, is welcome news for the Panama City property market.
The Red Carpet Visa should have a direct impact on sales of luxury apartments, providing international investors one more big motivation to buy. The new program offers anyone who spends $500,000 or more on a property an easy, fast route to full permanent resident status in Panama.
For a short time, there is an added twist to the visa deal: as reported by our friend, immigration attorney Ricardo Faraudo, a partner with DENFAB Law, the government is lowering the threshold to $300,000 for two years, in large part to help spark the property market.
International buyers play a large role in Panama City’s market, accounting for about 80 percent of sales. From our own experience, we know visa policy and Panama’s welcoming environment are an important part of the decision-making process for many buyers. Other countries around the world offer Golden Visa programs; the Red Carpet Visa makes Panama more competitive in the global market.
The Red Carpet Visa will offer many clear advantages for property buyers. It will be quick and easy to obtain–most of the paperwork can be handled from overseas. And the initial process is expected to take no more than 30 days, with the department of commerce handling applications, not the normal immigration department.
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The new visa is a clear improvement over the past offerings, in many ways. Citizens of Panama enjoy easy entry without a visa into countries around the world. The freedom and flexibility make Panama a great base for business or travel.
Also, the territorial taxation system makes Panama very attractive as a new country of residency and eventual citizenship. Many countries are looking at increasing taxes to help with COVID-related economic pressure; Panama, with its strong economic base, has announced no plans to raise taxes.
Instead, Panama is welcoming the wealthy from other countries and looking to boost the economy through a variety of measures, including the new visa program. The new visa sends a clear message that the government is looking to support the real estate market as the company emerges from the pandemic. Construction and housing are seen as key factors in the market recovery, and support of the real estate market was specifically cited as motivation for the new visa rules.
As we emerge from the pandemic, we expect to see a steady increase in luxury property transactions as this visa becomes better known, attracting more investors to the country. We’ve already seen great pent-up demand, which resulted in a surge in sales in August and September.
The new Red Carpet Visa will clearly spark more demand, making Panama all that much more attractive in the global market.
Duncan McGowan is President of Punta Pacifica Realty, the largest sales, rental and property management company in Panama City.