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Panama Property Purchase Checklist for Foreigners
By TropiCasas — Helping Expats, Nomads & Investors Navigate Central America Smartly
1. The Basics — Who Can Buy Property in Panama
Foreigners enjoy the same property rights as Panamanians. Titled land, condos, and commercial assets can be owned outright, except within 10 km of international borders or in certain island zones. Property can be purchased personally or via a corporation or foundation.
2. Buying as a Resident vs. Non-Resident
Category | Residents | Non-Residents |
Legal standing | Can live, work, and open local bank accounts easily | Can own property freely but may have difficulty opening local accounts |
Financing options | Access to local mortgages (Panamanian banks) | Typically pay cash or use foreign financing |
Residency requirement | Valid permit (Pensionado, Friendly Nations, QIV) | None — can buy remotely using Power of Attorney |
Ownership type | Personal, corporate, or trust | Personal, corporate, or trust |
Taxes | Annual property tax and local rental income tax | Taxed only on Panama-sourced income |
Visa benefit | Property ≥ $300K may qualify for residency | Can apply later using the property investment route |
3. Step-by-Step Purchase Checklist
1️⃣ Hire a qualified real estate lawyer — verify title, taxes, and utilities (fee: 1–1.5%).
2️⃣ Choose payment method — residents may access 6–8% mortgages; non-residents typically pay cash or via escrow.
3️⃣ Sign the ‘Promesa de Compraventa’ (Promise to Purchase) — details price, deposit (≈10%), and conditions.
4️⃣ Execute the ‘Escritura Pública’ (final deed) — notarized and registered at the Public Registry (≈7–10 business days).
5️⃣ Understand fees — 2% transfer tax, property tax exemptions up to $150K, and 10% capital gains tax on resale.
4. Benefits of Buying in Panama
• U.S. dollar–based economy
• No restrictions on foreign ownership
• Strong expat & tourism demand
• Low property tax
• 6–10% short-term rental yields
• Eligibility for residency via investment
5. Drawbacks & Considerations
• Non-residents may find bank financing difficult
• Coastal/island titles need extra due diligence
• Registration bureaucracy can delay closings
• Property management standards vary
• Verify remaining tax exoneration years
6. Pro Tips for Investors
• Buy titled property (not Rights of Possession)
• Verify exoneration & structure before purchase
• Obtain a RUC (Tax ID) for rentals
• Residency unlocks local banking and easier reinvestment
7. Long-Term Outlook
Prime zones (Casco Viejo, Coronado, Playa Venao, Pedasí) show 3–6% annual appreciation with 60–80% STR occupancy. Infrastructure upgrades — including the Pan-American Highway, Rio Hato Airport, and metro expansions — continue to boost investor confidence.
Summary Table
Type | Pros | Cons |
Resident Buyer | Access to financing, local accounts, visa perks | Must complete residency process first |
Non-Resident Buyer | No residency required, full ownership rights | Cash-only, limited bank options |
Investor Buyer | 6–10% rental yield, 3–6% appreciation, USD stability | Capital gains tax, management overhead |