18. Building a House in Panama | OPERATIONEXPAT.COM

This is my personal story about building a house in Panamá.

Will it be everyone’s? Absolutely not.

We all have different personalities and chemistry, experience and baggage…as do each of the characters. And, then there’s just timing and luck.

I write my expat stories to help me process all of the lessons that come with each one. I try to write them in a way that offers help to others.

This one started with back in 2017…when I began to research buying and building homes in Panama.

Both people in the Facebook expat groups I had joined, and those I spoke with in person, mostly offered warnings, admonishments and downright scary stories about building a house in Panama.

There wasn’t much positive. But, I did it anyways.

It’s probably too soon to write this story—the exhausting labor has only just ended and I’m totally spent. 😆

Maybe in years to come, when the memories have faded, I’d write it differently—but, I think it’s most beneficial, for me and those I hope to help, to write it while it’s fresh (and raw).

Beginning with the positive…

Despite a several year gestation period and difficult birth, our experience was far from a nightmare. And, in Panama, that’s positive!

For me, it was just a consistent flow of frustration—most of the time just a trickle with the occasional flash flood.

Without Ken, my partner in this crazy adventure and life, I would have drowned. With him, I came out the other side spent, but sane.

Today, we have a gorgeous, totally unique house with a mind blowing view and access to a secluded beach (AKA my happiest physical place on the planet).

At bedtime, our white noise is the constant sound of ocean waves and our morning alarm is sounded by howler monkeys and parakeets.

After six long years, my dream of building a nature and reading retreat has come true.

For all of these massive positives, I am deeply grateful.

However, there is more to the story.

One of my commitments on this semi-public journey is never to hide behind the happy parts and always tell the “whole” story.

The bottom line…

I thought I’d finish construction with a simple opinion about whether or not I’d recommend the builder I used.

Instead, I’m finishing with a surprising and much broader opinion—only build a house in Panama if it’s a last resort.

You’ll understand why I feel this way if you choose to read on…and on.

My process…

Going back to the very beginning helps me understand how I ended up where I am.

In this case, that’s the day I stood on the vacant lot and made the decision to build a house in Panama.

There were five reasons for this decision:

Reason #1 — Lust

Six years ago when Ken and I walked onto the lot where our home now lives, I was swept off my feet.

Once I knew this stunner existed in the area I wanted to live in Panama, there was no way I was living without it.

Everything I had seen was pale in comparison.

Since there were only three existing homes with a similar view and location—and none were for sale—the only choice I had was to buy a lot and build our own.

Reason #2 — Intuition

As a former real estate appraiser, and reasonably experienced investor, I trusted my intuition about a good investment.

I felt major potential the day I stood there gazing at the ocean…and, fortunately, I still feel it.

Reason #3 — Hyper-Optimism

My inner Pollyanna had zero doubt that nurturing a strong relationship with my American builder would ensure a smooth road.

Reason #4 — Masochism

The brutal work of designing the house, moving to Panama, getting residency, then building the house all while running my small tech company was par for my masochistic course.

Of course, I didn’t doubt that the Herculean effort would be worth it in the end.

Reason #5 — Ego

I believed my prior building experience, extensive research, heartfelt intentions and hard work would ensure that my experience would be different than the ones who had tried to warn me.

While these things do usually benefit me in big ways, their powers were stymied in Panama.

Today, the honeymoon is over, my inner Pollyanna is on life support, I finally prioritize self care over all, and I stand corrected and humbled.

Let me count the Whys…

There are several things I underestimated, dismissed, or overlooked in myself that are solid reasons why I should not have built a house in Panama.

Why #1 — I was already busy enough

I’m not retired. I run a small company with zero employees. If I don’t do it, it doesn’t get done and the company dies.

So, I wasn’t in a place of hand holding, spoon feeding, and repeatedly reminding anyone. Unfortunately, if you don’t do all of these things when building a house in Panama, you’re going to have headaches.

My lack of time also had me making some big assumptions—specifically that people heard and understood me the one time I told them. We all know the saying about assumptions, right?

Why #2 — My energy & patience buckets were far from full

I started this project when I was 50…and I woefully energy- and patience-challenged I was.

By the time we broke ground five years later, I didn’t have the energy to pay attention to every single detail (which is necessary in Panamá!) and was totally over my fellow adults’ lack of systems, excuses, effort, and ownership.

These buckets need to be filled to the brim to build a house in Panama!

Why #3 — I’m an HSP

An HSP (Highly Sensitive Person) is biologically wired to look for potential danger in order to protect the tribe, herd, pack, gaggle, etc.

As a result of our added alertness, we HSPs are constantly watching.

We don’t miss much and we have varying levels of anxiety as a result of our fantastic imaginations.

There’s A LOT of scary shit to watch out for when you’re building a house in Panama…definitely more than should have taken on.

Why #4 — Building isn’t necessary cheaper and definitely isn’t simpler

One of the main reasons I moved here was to reduce expenses, work less, and live as simple a non-retired life as possible.

Building a house in Panama is the antidote to all of this! 😆

You can get some incredible deals on existing houses from expats who are packing up and leaving town, some in a hurry.

And, the To Do List is usually MUCH shorter with an existing home.

Time had faded the pain of labor AND the many relax-less weekends after the birth of my first home.

The reality is that by building a house in Panama, I paid more so I need to work more to pay for it all and there are not enough hours left in the day for simple. 😣

Why #5 — I don’t have the confidence I thought I was buying

An important aspect of building my own house was having more confidence in my house as a result of choosing an experienced builder and being involved in the process.

I think our house is well built…but, I’m not totally sure.

The truth is that my builder barely visited the job site. While regularly criticizing Panamanian building standards, the house was built by a Panamanian crew, most of whom were really young, with almost no oversight.

Equally as frightening is that major decisions—like exactly where to place the house on our mountainside lot and where to direct the torrential tropical downpours—were left entirely up to us. (I’ve lost many nights of sleep over this insanity…see Why #2 😂).

We are having some issues—and I hope they can be resolved. It’ll be awhile before I exhale all the way.

Tips for building a house in Panama

If you want to ignore my recommendation and build anyways, I totally understand!

Just make sure you do solid research and read over these tips that I promise will improve your experience.

Tip #1: Find a builder who also offers in-house architectural services

Using your builder to design your new home will help in three ways:

  • It (should) save you a significant amount of money
  • The likelihood of mistake is (most likely) lower because your builder will have a deeper knowledge of your home
  • You’ll (probably) avoid a whole lot of childish finger pointing, bickering and tantrums

Once my architect and builder no longer talked to each other, I was smashed in the middle—and getting questions answered or issues addressed was more challenging.

Tip #2: Talk to as many previous clients as possible (and believe what they say)

Never let your ego convince you that you won’t have the exact same experiences of your potential builder’s previous clients. You’re no more special than the last guy.

Tip #3: Understand the structure of your contract

My contractor didn’t hide the fact that he created a contract that protected him and put me in a risky position—but, he also didn’t disclose it.

It’s totally my fault that I didn’t take the time to get educated on the exact way my contract was structured.

With hindsight, I wish I would have hired a U.S. contractor to look it over and enlighten me.

All of the U.S. contractors I’ve used in the past included a “Fixtures” section within the main contract and used allowances for those items I hadn’t yet picked out.

While my Panama builder also had a “Fixtures” list, his was much larger in scope—including all finishes, the roof, and all of the windows and large exterior doors—and it was not included in the main contract.

By doing this, he released himself from personal responsibility and legal liability for all of these items and put me in the position of having to get Spanish-speaking Panamanian sub-contractors to fix their mistakes.

And, because it’s Central America, there were major mistakes.

If I would have understood this single aspect of the contract, it would never have been signed.

Also, if you’re counting on any sort of a warranty from your builder, look closely at this clause of the contract. I never dreamed my builder would pull what he did with his prior three customers on me (there’s that ego I was talking about 😆).

Basically, he came up with false claims for money and tried to extort me. When that failed (save those emails!), he started dragging his feet slower than a sloth in quicksand. I could read the writing on the wall and decided to just get it done myself before the problems got worse, which he (of course) promptly told me would void my warranty.

Tip #4: Spoon feed your builder BEFORE you break ground

Over the three year design process (thanks, Covid), I created a comprehensive PDF that was filled with photos and details on design and finishes.

It clarified exactly how I wanted the house to look and was to function as a safety net (in case something was missed in translation between my architect and I) and as a visionary guide for my builder.

Don’t assume that it gets read (like I did).

It wasn’t until well into the finishes phase that I found out my builder didn’t look at the document.

He has indicated that if it was that important to me, I should have made it part of the contract…so that’s what I suggest you do.

Tip #5: Make sure YOU have a detailed accounting record of every payment and you get ALL promises in writing

When the end of the job comes and money is tight on both sides, accurate accounting records are priceless.

During the quote and contract process, keep ALL of your emails (this helped me BIG). And, if your builder tells you they aren’t charging you for something during the course of construction, get it in writing right away.

Tip #6: Be prepared to make MAJOR compromises

I consciously left my picky pants in the U.S. and approached this project ready to compromise. However, nothing prepared me for the BIG things that were nothing like I had planned.

While, overall, my house looks pretty similar to my vision…

  • The roof is not the color I ordered
  • The floors are not the colors I requested (and it was 100% luck that they ended up being okay with me)
  • Most of my book and closet shelves are not the design I requested
  • One of the bathrooms is not designed as I had requested
  • The main staircase partially blocks my powder room door
  • Our “rustic” concrete patios look straight out of a construction yard

First world problems for sure…but, still major compromises.

It’s better to mentally prepare for not getting everything you want so when you don’t, it’s less crushing.

Tip #7: Make sure YOU hire specialists for crucial aspects of the job

Things like site drainage and the placement of your home on a mountainside lot are massively important in the tropics—and should not be decided by you or someone who only sorta knows what they are doing.

Don’t assume your architect or builder will hire them on your behalf…take the lead and hire them yourself.

Tip #8: Only build a house in Panamá if you have a SOLID knowledge of construction, MUCH time on your hands, and speak a good amount of Spanish

If Ken didn’t oversee our crew, there would have been many more mistakes in the finish work than there were.

But, we were both at a disadvantage because of our almost non-existent construction knowledge and minimal Spanish.

We missed key stuff on the original plans because we didn’t know how to read the more technical parts—things like:

  • a single switch for the ceiling fan and its light (ridiculous in a country where it’s crucial to sleep with fans)
  • a missing hot water line in the casita
  • stairs that were too steep and needed to be redone (actually many experience people missed this)
  • strange toilets that were not what I wanted causing all of the bathrooms to be re-designed

Tip #9: Consider pre-fab

If you can afford it, look into modular construction.

In our area, companies like Espacio Lar have several projects in their portfolio now.

Had we known about them before we completed our architectural design, we very well may have used them.

With a pre-fab home, you know exactly what you’re getting and the gestation and labor are significantly shorter and much less painful.

However, and this is a BIG however, much research would need to be done on the long-term viability of any pre-fab house.

In time…

While not a fun experience, I learned A LOT from building a house in Panama that will serve me moving forward.

Time will heal. While it ticks by, we will keep adding our personal touches to make the house our home (and a spectacular retreat!) and learn everything we can about her so we can fix her when she’s broken.

While I won’t disclose the identity of my builder, I’m happy to let you know if I know the builder you are considering and if I do or do not recommend them. Even though we’re on the Azuero Peninsula, Panama is a small country, so I may be familiar with builders in other areas.

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