Law 41

A new law has been passed by Panama’s National Assembly recently, known as “Law 41”. The new law has created much excitement in the real estate market of the country as intelligent investors in the market have very clearly spotted the potential of the new law that has been passed.

The new law states that a multinational company within Panama will not have to pay income tax for any service that it provides to outsiders of the country. This new law has been initiated to encourage more multinational companies to establish in the country. The new law also allows a company to hire foreign employees and at the same time, allows the foreigners to reside and work in the country. The result of this is evident, more and more foreign population moving to the country and ultimately causing the real estate market to further spice up with demand.

Panama has been facing steady real estate growth in recent years, as a result of the economic development and an added advantage of political stability. Such conditions have made the Panama Canal gain momentum and tourism to also increase in the country. And, the latest addition, of course, is the new law, that is likely to make multinational companies locate themselves in the country and cause a pressure on demand for space for work and residence.

Two companies have already announced their relocation to Panama and two more are rumored to have plans to relocate into the country. And, while, sales price of residences have been increasing, lease rates of “Class A” office spaces have also increased significantly. Due to the high demand, the vacancy of “Class A” office spaces has decreased from thirty percent last year to three percent recently, and it is due to this that the lease rate of a “Class A” office space has increased by twenty percent compared to last year.

The current sales price is very much favorable. At present, the average sales price is twenty-two hundred dollars per square meter. The time is perfect to make an investment in Panama, because of the favorable rate and the added advantage of the new law attracting multinational companies. The investment is likely to prove fruitful over time as more and more multinational companies are convinced to locate in the country by the advantages provided to them by Law 41.