Navigate the Landmines of Panama Real Estate with the help of Punta Pacifica Realty
Panama City is one of the safest, most secure and easiest to navigate property markets in the world for international buyers. That said, there are still complexities and shady operators in the city, which can create frustration and cost you money. With that said, we here at Punta Pacifica Realty are here to help you navigate these complexities with the least amount of friction possible.
Every buyer and investor should enter the process armed with information to avoid potential problem areas. A few missteps can mean you will either pay too much for your condo; lose the condo of your dreams to another buyer; or, even worse, buy the wrong condo for you.
Here are eight common traps to avoid, which can save you money and help secure the best condo for you.
- Bidding Blind: If you don’t research the recent selling prices for comparable homes, making an offer would be like bidding blind. You could easily bid too much, or fail to make a competitive offer on an excellent value. Unfortunately, finding actual comparable values can be difficult in Panama City. Don’t make the mistake of going it alone. Finding data on sales requires the assistance of an expert on the market.
- Buying the Wrong Condo: Many buyers are swept up in the emotion and excitement of the buying process, only to find themselves the owner of a condo that is either too big or too small. Or maybe they’re stuck with a longer-than-expected commute to work. Or the condo requires a dozen more fix-ups than they really want to handle. Take the time upfront to clearly define your wants and needs. Put it in writing and then use it as a yard stick to measure every condo you consider.
- Incomplete Title Research: Don’t sign a deal until it is absolutely clear that there are no encumbrances on the property, such as tax liens, undisclosed owners, easement issues or unreported leases. In Panama, avoiding this trap is worth the extra effort to make sure the research on the title is thorough and complete.
- Hidden Repairs: Don’t expect the seller to acknowledge every physical detail that needs attention. You don’t want any surprises after the sale. Conduct a comprehensive inspection of the condo early in the process. Consider hiring an independent inspector to objectively view the condo inside and out, and make the final contract contingent upon this inspector’s report. This inspector should be able to give you a report of any item that needs to be fixed with an approximate cost.
- Not Getting Mortgage Pre-Approval: Mortgage pre-approval is fast, easy and free. When you have a pre-approved mortgage, you can shop for your condo with a greater sense of freedom and security, knowing the money will be there when you find the condo of your dreams. Shopping without first getting a pre-approved mortgage may sound easier, but it is a trap to avoid.
- Beware Contract Details: It’s a mistake to assume a seller is going to quickly and efficiently address all the repairs and qualifications in the contract. Any unfulfilled promises can delay the final closing and settlement. Agree ahead of time to have an attorney review the sale agreement on your behalf and make sure every task is completed, long before closing day. At PPR, we have two in-house lawyers specializing in Panama real estate, which is the type of attention to detail necessary in the city.
- Hidden costs: Make sure you identify and uncover all expenses far enough ahead of time that you factor them into your costs. When a transaction closes, you will often find surprise “sub-total” fees, such as loan disbursement charges and underwriting fees, which shouldn’t be a surprise.
- Rushing the Closing: Take your time during this critical part of the process and insist on seeing all paperwork the day before you sign. Make sure this documentation perfectly reflects your understanding of the transaction and nothing has been added or subtracted. Is the interest rate right? Is everything covered? If you rush this process on the day of closing, you may run into a last minute snag that you can’t fix, without compromising the terms of the deal, the financing or even the sale itself.
Jeff Barton is the Managing Director of Punta Pacifica Realty, the leading sales and property management company in the exclusive waterfront skyscraper neighborhood of Punta Pacifica. Jeff can be contacted at jeff@puntapacificarealty.com
