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Real Estate in Panama: The Ultimate Guide

Real Estate in Panama: The Ultimate Guide

real estate in panama

The country has been attracting expats and investors for decades and today it remains a popular place. It offers a stable economy, low taxes, a great climate, and affordable healthcare. In this article, you will get a general knowledge base of real estate in Panama.

Determine your goals… Why are you buying real estate in Panama

First and foremost, it is important to know why you want to invest in real estate in Panama.

For instance…

Are you looking to invest to get a better return on investments (ROI) than what you get at home?

Or are you looking to invest and get some capital gains when you decide to sell?

Perhaps you are an expat looking for a place to relocate.

It is very important to determine why are you looking to buy because it will help you to know where to look.

Panama is currently in a buyer´s market, which means, buyers and investors can get great deals if they know where to look.

In the following sections, you´ll get a general outline of the country and Panama City.

Best Places to Buy Real Estate in Panama.

First, here is a list of the best Panama real estate communities for ex-pats:

  • Coronado and the nearby beaches are always a favorite for expats.
  • Boquete is quite popular (but getting expensive in the last couple of years).
  • David, Chiriqui, small town, very popular, affordable and close to touristic areas.
  • Panama City is always great but it requires a higher monthly budget.

In Panama City, these are the most sought-after neighborhoods and best places to buy real estate in Panama:

  • For high-end real estate Punta Pacifica and Costa del Este.
  • San Francisco and Bella Vista are central areas with access to all parts of the city.
  • El Cangrejo and El Dorado are interesting lower-budget investments, that can be rented to university students.

These neighborhoods are always top of mind for renters, locals, and foreigners.

So, if you decided on where you want to relocate, then it´s time to start searching online before getting in touch with a broker.

About Listing Prices of real estate in Panama.

You may want to start looking at online portals, and you should.

It is a great way to get a feel of the market.

But beware that the portals may have information that is not accurate, so you may encounter these three scenarios:

  • The price is way above the market average
  • It may not include sales taxes.
  • The price is correct.

Since Panama is in a buyer´s market, there is no reason for you to pay above the market average.

Compare prices of similar properties and get help from a real estate agent so that you pay a fair price.

In the second scenario….

Some sellers may not include the sales taxes in the listing price, expecting for a buyer to take care of it.

The sales taxes are the responsibility of the seller, not the buyers.

It is important as an international real estate buyer, that you are aware of how the transaction is handled in Panama.

If you are from the United States, for instance, escrow is a normal procedure in any property purchase and sale deal.

In Panama, there is no escrow.


Read on and discover how property deals are handled in Panama.

The Real Estate Transaction

Once you agree on a price, you can take a look at the next steps of the real estate transaction in Panama.

In Panama is very straightforward for the buyer:

  • Have a lawyer conduct due diligence on the title of the property.
  • Sign a promise to buy and sell contract and pay the downpayment (usually 10% of the sale price) Your lawyer must also review this document, if he or she prepares it, even better.
  • Wait for the seller to produce all documents necessary to complete the sale (in good-standing certificates of taxes, maintenance fees, and sales taxes)
  • Sign the final deed in a Public Notary and send it to the Public Registry.
  • Make the final payment.

The cost of the final deed is paid by the buyer, so it’s important to keep that additional cost in mind.

Since there is no escrow in Panama, in its place you can:

  • Have your bank make a promise to pay letter, which is fulfilled once the deed is registered at the Public Registry
  • A public notary can take a bank check in custody, with instructions to give it to the seller, once the transaction is completed.

When you have the property in your name or in the name of a Panama company that you own, you should know the responsibilities that come with real estate ownership.

Ownership of Real Estate in Panama.

Once you are the proud owner of a property in Panama, there are a couple of legal things you must do:

  • Update the value of the property at ANATI.
  • This has to be done manually sort to speak, it is not automatic.
  • If it´s not done, you will pay property tax in accordance with the previous value and will have to update when you decide to sell.
  • Get your email and NIT of the property in the Tax authority´s (DGI) electronic system (E-TAX)
  • Nit is the password to log into your property tax digital record.

A final thought regarding ownership…

For greater protection of your property, I strongly suggest you buy in the name of a Panama company.

It gives you a layer of protection against liability.

You can learn more about Panama Companies here.

Real Estate in Panama: Property Tax

Real Estate in Panama property taxes are quite low compared to other countries.

The regular rate for second homes (not sold by a developer at a low price) and commercial properties are:

  • Up to $ 30,000, you pay 0.00%
  • From $ 30,001 to $ 250,000 you pay 0.60%
  • From $ 50,001 to $ 500,000 you pay 0.80%
  • From $ 500,001 onwards you 1.00%

There is even a lower property tax rate that anyone can apply, you can learn more about it in this article.


So there you have it, hopefully, this guide will help you get a headstart in locating the best place for you and purchasing your first Panama Real Estate.



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