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Appraising Your Panamanian Property. Buying a property abroad can be a daunting prospect and once you find a property you like, you then check the title is in order, one of the first things you need to do is to get a valuation. This is a requirement all banks will ask you for before giving you a mortgage.
The real estate valuation for the bank guarantees that the house has a sufficient value so in case of default they can recover the money borrowed by the mortgage. Banks usually do not finance more than 80% of the appraisal value of the home, for that reason this information is very important for the individual in order to know the financial outlay required to formalize the constitution of the mortgage loan, if necessary.
Valuations will give a real value of the property you are planning to buy and gives a bargaining tool to negotiate the price. It normally includes a detailed description of the property, its conditions and availability.
The commercial valuation is an estimate and a reliable opinion of the properties value. It is the most important part of any conveyancing transaction. Various parties are involved: the seller who wants to know the value of their property to determine which price is beneficial for their interest. The buyer needs a precise and trustworthy estimate to see if he is paying a fair price; the real estate agent wants to obtain the maximum commission for the sale and of course the bank, which will decide if it gives the mortgage or not.
The valuers take into account the price of replacing the property, which means how much it will cost you to buy a comparable estate that has a similar design and construction. The other factors that must be taken into account is if the property has reached it’s maximum value; external issues such as opening of a factory close to its location; offer and demand of properties in a particular area; wear and tear of the building.
Valuers also take into account if the neighborhood is regressing or progressing, that will depend on maintenance of the neighboring houses and the way they look. Another element is the improvements made to the property (i.e. a new kitchen, extension etc.)
The appraisal of properties range between $50 to $1,000 depending on the size. For example a valuer can charge between $100 to $150 to appraise a three bedroom home in Panama City, however the cost could increase to $1,000 plus transport expenses and average time to do the valuation, if the real estate in question is a 150 hectare farm in the interior with two houses, barn, horses, cattle and other improvements. The cost of appraisals for houses in general is between $50 and $300 depending on the property.
It is important to find the right experts with regards to real estate appraisals and not hire inexperienced people, who in the long run will cost more time and money. There are several appraisal companies in the country that offer valuations services which are accepted by the main banks, although the majority of those financial institutions have their own appraisal departments. These companies are AIR, AVINCO, Zubieta y Zubieta, Panamericana de Avalúos and Florida Panama to name a few.