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Your guide to property management in Panama

Luxury mansion located in Panama

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Facing the crystal blue waters of the Pacific on one side, and the Caribbean Sea on the other, Panama has a wealth of beachfront homes and hilltop estates. This combination of breathtaking scenery and dazzling homes presents a great opportunity for the savvy property investor who can rent out their properties as well as personally enjoy the perks of this superb location.

But purchasing real estate in Panama is only the first step if you’re aiming to turn a profit. You’ll need a property manager like Red Frog Beach Resort to ensure that your rentals are taken care of, marketing and maintenance are executed to high standards, your guests are delighted with their stay, and you have a steady return on your investment. All done with minimal work and hassle on your end.

When you purchase a property in our resort in Bocas del Toro, you immediately have the option to join our rental pool, opening you to our property management services. This makes the path to purchasing a property and making it an income generating investment seamless.

  1. The scope of property management
  2. A stellar property manager can make the whole endeavor seem effortless. Property management in Panama encompasses a range of services which typically require a whole team of professionals. Here’s a glimpse of what Red Frog Beach Resort does for you:

    • Marketing – Before a listing gets posted, there’s a lot of work done behind the scenes, from taking captivating photos and making well-presented videos to crafting enticing property descriptions. After publishing, it’s important to expand your reach into viable social media channels where you can get the attention of the right audience. Then there’s the matter of engaging potential customers and answering inquiries about the property.
    • Tapping into social media – Facebook, Instagram, and other social media platforms can quickly get your listing the exposure it needs. Red Frog will actively respond to the flurry of inquiries (including non-serious ones). We’ll be able to separate those that are good possibilities for your property while being discerning and filtering out those that may not be beneficial for your project.
    • Leasing – Once you’ve acquired a tenant, we’ll begin the process of drafting a lease contract. It’s crucial to identify the factors you’re willing or unwilling to compromise on.

    Beautiful backyard near the beach of a house in Panama

    • Amenities – With so many things to do at Red Frog Beach Resort, your guests will need to know specific information about the resort amenities. For example, how guests can rent golf carts, the benefits of the beach club, what cultural events can they attend? Red Frog Beach Resort will be on hand with their friendly and knowledgeable staff to accommodate and address any queries on what fun activities are available at the resort.
    • Guest communication – Every now and then, guests will ask a few questions to verify house rules or raise other concerns relating to the property. Communication doesn’t end after you’ve signed the lease and handed the keys over. At Red Frog Beach Resort, we ensure that there is always a means and avenue for your guests to reach out with any concerns or requests they may have.
    • 24 hour service – Red Frog Beach Resort will be there 24/7 for your guests. We provide a concierge service including housekeeping, security, and anything your guests need throughout their stay.
    • Maintenance and upkeep – Red Frog Beach Resort will ensure that all the properties that are part of their rental pool are kept in pristine condition. Red Frog Beach Resort will maintain your landscaping, pool service, and also have a preventative maintenance program to ensure your guests enjoy your property.
    • Full support and protection – With Red Frog, your property and its contents are protected. A final walkthrough or inspection of the property is conducted before a guest moves out. We take note of anything that may be out of place, whether it’s a cracked floor or a missing piece of furniture. If any repairs or replacements are required, you’ll have a professional service manager to handle all the complications.

  3. The benefits of short term rentals of Panama property
  4. You have two main approaches if you choose to rent out your property: long-term and short-term rentals. Depending on the number of properties in your portfolio and the specific financial goals you want to hit, you may prefer a particular approach over the other. Alternatively, you can also do a mix of both long-term and short-term rentals.

    The benefits of short term rentals

    Property owners have more opportunities to recoup the investment much faster with short-term or vacation rentals, especially in a country like Panama that frequently attracts tourists from all over the world.

    • Property owners can charge higher rates and generate higher gross income in a year. Considering the nightly rate, the number of guests you’ll have in a year, and the average stay per guest, short-term rentals can be quite lucrative.
    • There’s more flexibility with the short-term approach as well. Since guests will only be staying for a few days or weeks, property owners have much more leeway if they plan to sell in the near future.
    • Maintenance of the property doesn’t have to be largely relegated to a tenant who may not be as thorough. Each time a short-term guest checks out, cleaning and other maintenance work can be done right away.

    As part of Red Frog Beach Resort’s rental pool, there’s no need to spring into action every time a guest checks out and checks in. For many, this simply would not work as it would require far too much time and effort on their part, especially if they reside in a first home in another country. As part of the Red Frog community, all will be taken care of under their property management services.

    What to bear in mind with long term rentals

    In general, long-term leases offer stability and peace of mind for the property owner. They usually lasts for six months at the very minimum (12 months if a tenant has a wider timeframe).

    • If all goes well and the tenant pays on time, the owner will be receiving a guaranteed stream of additional income throughout the lease.
    • Upkeep expenses are generally low since long-term tenants are contractually obligated to keep the property premises clean and in good condition. Additionally, long-term tenants are typically more inclined to treat the property as their home.
    • Tenants may also shoulder the cost for necessary repairs that may arise from their usage of the property and its attendant furnishings.
    • With the property occupied for an extended duration, marketing the property won’t be as frequent.

    However, there are a few disadvantages to a long-term lease, such as:

    • The return on investment generally has a longer time horizon. The lower price of long-term rentals compared to vacation rentals and the inability to raise rents for long periods of time are two factors to carefully consider.
    • There’s no guarantee that you’ll transact with good tenants all the time. Additionally, several aspects of managing a long-term lease hinges on the quality of tenant you have. In other words, a problem tenant can create complications in other areas of property management.

  5. Familiarity with Panama real estate is crucial
  6. Given enough time living in Panama and reading up on local regulations, it may be possible for an owner to manage the property by themselves. After all, there’s virtually no language barrier in Panama as English is the second most spoken language. That said, in contractual disputes, issues will only be resolved by examining the Spanish version of the contract.

    Moreover, there’s no replacing years of experience and familiarity with the local real estate landscape. Having access to local expertise is critical if you want to ensure a hassle-free transaction with local government bodies and with tenants.

    A professional property management team in Panama like Red Frog Beach Resort will carefully guide you through key tasks, including:

    • Navigating local homeowners associations. Although the 45- day rule on short-term rentals is only applicable to Panama District and Panama City, homeowners associations throughout the country may uphold similar or more stringent rules. A local property manager will help you identify areas where you can freely operate a rental without any issues.
    • Creating a Panamanian corporation. Investors who own a handful of properties aimed at business activity are generally advised to establish a local corporation. This is a standard asset protection strategy. Just keep in mind that due to the commercial nature of such an entity, additional tax obligations may apply.
    • For most, investing in a property in Panama such as the resort in Boca del Toro, is made considerably easier when you join a resort rental program, such as is offered by Red Frog. The property management services they provide were set up to facilitate easy ownership and the renting out of property for investors. Simply put, they take out the hassle and uncertainty of resort investment in another country, opening up not only your ability to enjoy a paradise home but to generate income from it.

  7. How to find the right property manager in Panama
  8. Gauge their ability to handle difficult situations

    Try to get a good sense of how a property manager navigates tricky scenarios. The last thing you want is for a professional to lose their composure with difficult people who are residing in your property.

    There are no right or wrong answers, but the responses they share will give you a glimpse into their management prowess and overall experience.

    For one, you can ask them about the last time they dealt with a problematic guest and how they resolved it amicably or otherwise. You can also ask them about how they eased tense situations arising from extraordinary natural events (e.g., storms, floods) and how they reassured guests.

    See if they can accommodate special requests

    Many owners will have special requests or rules that they’d like guests to uphold while in the property premises. For the detail-oriented, the ability of a property manager to accommodate special requests is invaluable.

    If you’re one of these property owners, it’s important to make sure that the professionals you hire are more than willing and able to execute. Whether it’s serving guests with specialty coffee every morning or prohibiting pets inside the home, there’s a range of special requests you can ask the management team to fulfill.

Get in touch with Red Frog Beach Resort

Beautiful beach in Panama

Whether you’re searching for top-tier property management in Panama or looking for the best beachfront properties, you’ll find what you’re looking for in Red Frog Beach Resort — the only Green Globe-certified resort in Panama.

Since inception, the resort has received numerous awards, including the TripAdvisor Travelers’ Choice Award for 2019, 2020, and most recently for 2022. Red Frog Beach Resort has also been featured in HGTV House Hunters, E! News, Forbes, World Property Journal, and The Washington Post.

Located in the stunning Bocas del Toro archipelago, Red Frog Beach Resort is where you’ll discover an array of luxury properties that are suitable for both short-term and long-term rentals.

Contact our team to learn more about your real estate investment opportunities in this one-of-a-kind region in Panama. You can contact us by phone at our US office or Panama office. You may also reach out to us via email inquiry.

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