Retiring Way, Way South of the Border
Americans are starting to head into Central America for retirement, lured by luxury real estate and eased residency requirements.
When Steven and Robin Fine started searching for a place in Latin America to spend their early retirement, they looked at spots in Mexico and Costa Rica, both popular destinations for American retirees. On a trip two years ago, they decided to stop by Panama, too.
"We thought we would like Panama the least," Mr. Fine, 51 years old, a former communications executive said, "but we liked it the best."
The combination of luxury apartment buildings, good restaurants and modern hospitals drew the couple to Panama City, where 1½ years ago they spent $1.1 million, plus about $250,000 on renovations, on a 48th-floor penthouse with a view of the Pacific. It is now their full-time home.
The Central American nations of Panama, Belize and Nicaragua are increasingly competing with Costa Rica and Mexico for North American retirees and second-home buyers. New luxury developments, outfitted with spas, restaurants, marinas and golf courses, are on the rise. Builders say they are using more high-end materials and adding upscale amenities designed to appeal to affluent American buyers.
These countries offer packages of residency and breaks on taxes and fees that imitate Costa Rica's pensionado program, which was introduced in 1971 and helped set the groundwork for a boom in retiree emigration from North America. Nicaragua added such a law in 2009, offering foreigners with retirement incomes tax breaks on everything from cars to construction materials. Last year, Panama, which has a long-established retiree program, created a path to citizenship for retirement residents and introduced a new residency program for people under retirement age that has lowered requirements for investment in property, business and other ventures.
Despite their inroads with American retirees, these countries still don't attract the same numbers as more established destinations, such as Mexico and Costa Rica. In 2011, more than 50,000 Americans collected Social Security in Mexico and more than 5,000 in Costa Rica. But Mexico's well-publicized drug war and escalating violence are starting to push Americans to look at new places for retirement. Central America, however, has its own problems with crime.
The U.S. Department of State labeled the crime rate in Nicaragua "critical" and the murder rate in Belize "extremely high," though concentrated in Belize City and not in tourist areas. In Costa Rica, petty crime such as theft and "smash and grab" muggings have increased in the past couple of years, along with home invasions. In Panama, murders and gun violence have decreased in recent years, but reported rape and theft have increased.
"Panama remains relatively safe when compared with other Central American countries, yet crime rates are higher than one would encounter in most of the United States," says the State Department's 2013 report.
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Despite their inroads with American retirees, these countries still don't attract the same numbers as more established destinations, such as Mexico and Costa Rica. In 2011, more than 50,000 Americans collected Social Security in Mexico and more than 5,000 in Costa Rica. But Mexico's well-publicized drug war and escalating violence are starting to push Americans to look at new places for retirement. Central America, however, has its own problems with crime.
The U.S. Department of State labeled the crime rate in Nicaragua "critical" and the murder rate in Belize "extremely high," though concentrated in Belize City and not in tourist areas. In Costa Rica, petty crime such as theft and "smash and grab" muggings have increased in the past couple of years, along with home invasions. In Panama, murders and gun violence have decreased in recent years, but reported rape and theft have increased.
"Panama remains relatively safe when compared with other Central American countries, yet crime rates are higher than one would encounter in most of the United States," says the State Department's 2013 report.
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For the full text, see http://online.wsj.com/article/SB10001424127887324879504578599770182918926.html
Beach resort. Price range: EUR 125,000 to 143,000 
Panama City. Sale price: US$350,000
SOLD
