I’m done with Panama Real Estate
As a professional overseas property investor, I am only too aware that I am constantly one mistake away from bankruptcy – that’s all it takes - one investment gone awry, one condominium building that didn’t get built, a sudden unexpected drop in the market, a burst real estate bubble, and I am back to washing dishes. Well, maybe not quite that bad – I might have to sell one of the Bentleys, which would be almost as much of a disaster.
Anyway, the purpose of this is to talk about the upcoming burst Panamanian property bubble. I know, it hasn't burst yet and I know Mark doesn’t agree with me on this one, and even as he edits this before posting it, I can almost hear him cursing and imagining himself re-writing it.
I am out, finished and done with Panama for the foreseeable future. Why? It’s going to burst, and soon. Yes, I have made a bundle in Panama over the last four or five years. I even bought and sold the same condo twice – and made a profit both times. I picked up half a dozen high-end condos at $1,000 a square meter and sold them two years later for $4,000. My local agent was happy as Larry, that was the third time he’d sold them since the project broke ground.
But, the last visit I made told me one thing – the only people buying into Panama are the speculators and at some point in the not-too-distant future (I think within 8-12 months, certainly before 2008 is out) Panama is going to pop. Supply and demand rules the property investment world and there is nowhere near enough demand from the ground floor to support that many luxury condos. I got out while the getting was good. Take a long hard look at the social structure in Panama before buying property as an investment there. If you wish to live there, OK, different story, but from a pure overseas property investment viewpoint, be very, very careful out there. I expect 20-30% of the current un-started projects never to be built.
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Yea this guy gets it! but hey, its ok for me as long as people speculate, which probably will not be for too long since I am invloved with the following Real Estate company
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Panama Real Estate
I was recently in panama this year and this was the talk about how much the city was in a boom but i would have to agree with you. I simply do not see how all of these properties will be filled. maybe later down the road as the canal is now going into an expansion project maybe it will bring more people to the city but…i think i will agree on your call.
Obvious risk of oversupply, no-resale market and low occupancy values.
All these will inevitably trickle through and affect values. As The Economist correctly observes, this boom in real estate has not come with socio-economic reform modernising old school institutional corruption. Not to mention, the capital city has a complete lack of public transport. Its plethora of buses or “diablo rojos” are privately run!
If the city is to absorb all this growth. There needs to be massive investment in public infrastructure. Only then can it sustain all of this development.
After the enlargening of the canal, the implementation of the balboa-colon railroad, expansion to Tocumen airport and the high-tech parks in the canal zone.. this should all bring both capital and the skills required.
My point is that with such dramatic contrasts in wealth and poverty, there is still vast swathes of a once highly militarised, armed and politicised society that need to be given a share of all this wealth and development. If they are polarised further, then there could be some rather serious consequences.
Economic stablity and long-term growth are not a given here, and never have been.
Hugo – yes, although Panama City is not alone in this problem. Most of the “emerging” markets face similar issues.
A recent suggestion was that developers must build a certain amount of affordable housing along with any luxury developments, but…….
2009 is fast approaching and even with falling global economies Panama’s bubble definately has not burst 2 years after this article was posted.
With the current global financial problems there may be a slow down, but with the current large infrastructure projects within Panama (most famously the canal expansion), the interest is still there and properties are still selling.
The country is still growing and the local economy is still strong and the banks have healthy cash deposits on hand.
Many projects that have just commenced construction are probably a good buy as with the current decrease in the cost of building materials you will find that the developers are taking advantage of this and completing these projects sooner rather than later.
Well, this was written November 2007, so that is hardly 2 years.
Any details welcome though. Palacio de Bahia and Ice Towers failed, and there are still legal battles over deposits paid. Ongoing clashes with labor unions are an issue, the condo flipping craze is now over.
Admittedly, the canal project is still pumping money into the economy, and this market is perhaps not as weak as Dubai for instance.
Nevertheless, Construction permits are down 35% and condos are taking an average of 15 months to sell.
The meltdown in the US market is already having an effect and gone are the days when middle class Americans could refinance back home to buy a vacation condo.
What is the situation in Panama real state now?
Why am I not surprised that this would occur? Apparently, the rich saw an opportunity, once again, to STICK IT to others so they get rich overnight and in the process, destroyed something that could have made them a FORTUNE, if they were only patient!
This JACKASS even boasts and brags about “(making) a bundle…”, then having to sell one of his Bentleys, when he started to feel the pressure!
Oh…cry me a river of tears, you miserable CUSS! You’ve raped and pillaged the country, now, pick up your toys and go home!
Anytime you greedy PRICKS enter the picture of an investment opportunity, things turn to shit!
You all raise a ruckus, wave your stolen cash from other scams & titanium credit cards, drive your faggity Bentleys, promise boomers property in paradise especially areas with an average Temperature of 70-75, duel Ocean views, etc.
And for what??? To profit overnight?
History is repeating itself in Panama…see the US real estate bubble!!!
You all got ‘Giddy’ like little school girls, when the Trump (Chump) Clan entered into the picture and built a BIG tower downtown. OoOoOo…!
Watch and see that IDIOT file for Bankruptcy again, when he starts losing his ass, due to Panamas real estate bubble EXPLODING! Then, Panama City will have a big beautiful building…but, EMPTY!
From your GREEDY, Self Serving tactics, I’m wondering how many people will suffer? Will banks in Panama fail just like they did in Greece, Iceland, US and other parts of the world?
You could have been much more successful & lived in Paradise, if you had only approached this with a different state of mind.
If you would have entered this with only receiving a measly 10% or 15% profit from each sale, you would have been not only helping yourself, but others.
I wonder how many good & unsuspecting people have suffered because of these morons ripping them off?
You, along with the other nimrods fail to grasp the overall picture…
IF banks fail due to the incompetence & greed of others, I’m going to predict stricter regulation imposed by the Panamanian Gov’t.
Regulations COULD include amending NEW laws for future investors and stricter guidelines for those wishing to purchase property.
New investors will not be exempt from paying tax for 20 yrs., so that the Gov’t, (if they have to bail out banks from your stupidity) can recoup the loses.
Furthermore, I would suspect that, those burnt from morons like you, will have to give up their exempt status and pay full price for just about everything.
So, when it’s all said and done and as usual, the greedy, self serving rich scumbags will more than likely, have fucked over the poor once again!
Oh…BTW…I would even hire you do wash my dishes! I’ll hire and generously pay a poor Woman to do that task!
It’s morons like you that give the hard working and HONEST well to do people a bad name! You’re nothing but a Paris Hilton wannabee!
JMHO!