RACO Investment Founder Randall Castillo Ortega discusses real estate investments in Panama
Panama is a country where real estate investment expectations are met in a safe and risk-free way because it has a consolidated democracy, which leads to legal certainty, creating an ideal framework for investing. It has a stable government and a strong economy based on the US dollar. Even after the COVID-19 pandemic, investing in real estate in Panama is beneficial. Randall Castillo Ortega, the founder of RACO investmentexplain why.
Despite the crisis, Panama remains at the top of economic growth expectations in the region. So much so that, recently, five multinationals known as Spectrum Biomedical Latam (Canada), Inceca Regional Services (Nicaragua), ABB Central America and the Caribbean, SA (Switzerland), Alórica Panama (United States) and EY Latam North Holding SA (US UK and US), will establish its headquarters in Panama. This will have a positive impact on economic recovery, increasing demand in the real estate sector.
In times of uncertainty, where the fluctuation of the market is not clear, it is necessary to analyze which investments present risks and which do not. For example, investing in stocks on the stock market is a risk. However, investing in Panama in the real estate niche will always be a good option as it will remain an unwavering investment. Adds Castillo, “Capital gains should be taken into account, which is when a property gains value over time. If this factor is combined with inflation, we will help a project to set a value at the time of purchase and that over the years, positively, that price will increase.In addition, real estate has easy access to investment liquidity unlike other methods of investing. investment.
In Latin America, the real estate sector remains in an optimistic scenario. Housing investment continues to be conceived in the medium and long term as a solid and intelligent opportunity. The Panama Canal, which since its opening in 1914 lets through more than 5% of world trade, allows the country to obtain a high return and attracts investors from all over the world to invest in various activities, including real estate investment.
Panama’s economy is stable, with the US dollar being legal tender. Investing in dollar-traded root bins can be a way to reduce risk. Support in capital gains and asset value attest to the minimization of any insecurity the currency may have.
The real estate sector offers a wide range of real estate projects in which to invest, presenting a diverse geography, with unspoilt jungles, mountains, tropical islands and a modern capital with a large urban development with all amenities.
Panama presents itself as the hub of the Americas for its strategic air, commercial, logistical, financial and maritime location of global scope. It also has several special economic zones, such as the City of Knowledge, Panama Pacific, Export Processing Zones, and Colon Free Zone.
Compared to other neighboring countries in Latin America, Panama is a safer country. The cost of living is lower and the quality of life is high. Also, there are no natural disasters such as hurricanes or earthquakes.
There are exemptions and reductions for retirees and seniors, which would be similar whether you are a retired foreigner residing in Panama or a national. These include discounts on land and air transport, cinemas, medicine, restaurants, shopping and services.
There is also a very strong banking system in Panama. Castillo explains: “Over the past 20 years, there have been mergers, transformations and incorporations of new banks that have helped regulate and resize the sector. As a result, Panama is now one of the most important financial centers in Latin America.
Foreign investments are protected by the Civil Code of Panama, its Constitution and its law on foreign investments. This protection ensures that foreigners have the same rights as Panamanians in terms of property, investments and trade.
Finally, investing in Panama has the advantage of being considered a tax haven. Income generated within the country, including that generated by sales made within Panama, bears Panamanian tax, since the tax legislation is based on the principle of territoriality. All real estate sales in Panama are subject to a 2% transfer tax on the root property.
About RACO Investment
RACO Investment is a financial investment company serving small and medium enterprises in Panama and Costa Rica. It was founded by Randall Castillo Ortega, an expert financial advisor who has his roots in the import and export industry in Latin America. The company has helped many startups find the financial support they need to get started, and has also provided bridging loans to help those looking to restructure or improve their operations.
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