Wednesday, August 1, 2012

Panama

When you think about living full or part time in Central America, Costa Rica seems to be the first country that comes to mind. Having spent a fair amount of time in both Costa Rica and Panama, I may be able to offer a somewhat unique perspective when comparing the two countries. While both countries are similar in many respects, there are some major differences in property in Panama versus property in Costa Rica that you should be aware of.

First of all, there are many similarities. Both properties Panama and Costa Rica have mountains, oceans, beaches, volcanoes, tropical rain forests, zip line tours, hot springs and exotic wildlife. Both countries have more residents who speak English in the bigger cities, while very little English is spoken in the more remote areas. Both countries have similar temperate climates, and both are quite beautiful. I honestly can't think of a single good thing about Costa Rica that you can't also find in Panama.

Now let's talk about the differences, and they are significant:

Roads: Costa Rica is famous for its bad roads, and they are terrible. Every time I'm in Costa Rica I can't believe how bad the roads are, while the main roads on Panama land are all paved and relatively pothole-free. Why are the roads in Costa Rica so bad? I have no idea, but trust me, they are horrendous.

Cost of Goods: Panama is a big winner here. Thanks to the Panama Canal and its huge port, manufactured goods are much less expensive in Panama. Household appliances, electronics, building materials, almost everything is more expensive on Costa Rica land. I haven't had a lot of experience buying cars down there, but I've heard from reliable sources that Costa Rica has a huge tax on automobiles that I know for a fact Panama doesn't have. Apparently a ,000 car in Panama would cost over ,000 in Costa Rica.

Currency: Again, Panama comes out ahead. The official currency in Panama is the Balboa, which is tied directly to the U.S. dollar. The paper money (one dollar bill and up) is all U.S. currency, and there is no exchange rate. The currency in Costa Rica is the colon, and exchange rates fluctuate on a regular basis. You need to constantly change your U.S. money into colones, bring a calculator everywhere you go, and always be aware of locals trying to take advantage of you. Financial transactions of any kind are much easier on property in Panama.

Capital Cities: When you fly into San Jose, Costa Rica, it feels like you've landed in a third world ghetto, but when you fly into Panama City it feels like you've arrived to a modern, cosmopolitan metropolis. It's really about that simple the difference between the two cities is staggering. San Jose is a dirty, dangerous place with about four street signs in the entire city. Panama City has dozens of gleaming new skyscrapers and is in an obvious phase of progressive expansion. The reason that Panama City is light years ahead of San Jose is because the U.S. was actively involved in the Canal until 1999, so the infrastructure is surprisingly modern. It's not a coincidence that a Trump Tower is going up in Panama City, but not in San Jose.

On a side note, I have found the people in Panama City to be much friendlier and more helpful than in San Jose.

Crime: No contest here; Costa Rica has a much higher rate of crime. Armed robberies, carjacking and other violent crimes occur far more frequently in Costa Rica. In 2007 the U.S. State Department designated Costa Rica as a high crime rate country for tourists. While these crimes do occur in Panama, the incidence is much lower and occurs primarily in the Canal Zone, between Panama City and Colon. I've been living part time in Santiago (three hours west of Panama City) for over a year, and nobody I've talked to has ever heard of a murder, armed robbery, or even a mugging. I've left tools and work boots outside of my house for weeks at a time, and I've never had anything stolen. This would be unheard of in Costa Rica, where theft is a common, everyday occurrence.

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Real Estate: Let's save the best for last; you can purchase land in Panama for a fraction of what it would cost you in Costa Rica. The same large six acre lots with ocean views and riverfront that I'm selling in Panama for around 0,000 would cost at least 0,000 in Costa Rica. Land in Costa Rica is roughly five times more expensive than comparable land in Panama.

Another big difference between the countries involves squatters. In Costa Rica if you buy land and squatters move onto it, in three months they actually have rights to your property, and protracted legal action is required to get rid of them. Incredible, but true. On Panama real estate squatters have no legal rights whatsoever. If you buy land in Panama, leave it alone for ten years, and upon your return people are living on it, you can have them removed immediately.

I think the facts speak for themselves. If you visit both countries, I think you'll find out for yourself that to purchase land in Panama is far superior choice then Costa Rica for a variety of reasons.

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