$0
Agent commission for buyers with us
1% to 1.5%
Typical buyer legal fees
2%
Transfer tax, customarily paid by the seller
$120,000
Primary residence property tax exemption
The Short Answer
Closing costs for a cash buyer in Panama are low compared with Canada, the US or the UK.
When you buy with Panama Properties you pay no agent commission. Your main costs are legal fees of about 1% to 1.5% plus small notary and Public Registry fees. The 2% transfer tax is customarily paid by the seller.
On a typical cash purchase, that means total closing costs of roughly 1.2% to 2% of the price. If you finance, the bank adds its own fees, which are covered below. After closing, budget for annual property tax, monthly HOA fees in a condo or gated community, and utilities.
Every figure on this page is a guide as of October 2026. Your attorney will give you a written estimate before you sign anything, and our step-by-step buyers guide explains where each cost falls in the process.
Costs You Pay at Closing
These are the buyer's costs on a standard resale or new-build purchase.
Your Attorney
Plan on about 1% to 1.5% of the price. Some firms quote a flat fee on smaller purchases instead.
Your attorney searches the title at the Public Registry, drafts or reviews the Promise to Purchase Agreement, checks for liens and unpaid taxes, and prepares and registers the deed. Always use your own independent attorney, not the seller's.
Notary and Public Registry
The deed is signed before a public notary and then registered at the Public Registry, which is what makes you the legal owner.
Together these are usually a few hundred dollars on a typical home. Registry fees are based on the value of the transaction, so they rise slightly on larger purchases.
Escrow and Deposit
Most buyers place a deposit of about 10% in a trust or escrow account when the Promise to Purchase Agreement is signed. This is part of the price, not an extra cost.
If you use an escrow company, expect a small fee. Your attorney will tell you which option suits your purchase.
Agent Commission: None
Buyers pay no commission when they buy with us. You still get full buyer representation from start to finish.
Adjustments
Your attorney confirms that property tax, water and HOA fees are paid up to the closing date. The seller must provide clearance certificates (paz y salvo) before the deed can be registered, so you do not inherit their debts.
The 2% Transfer Tax and the 2026 Change
The transfer tax is a seller's cost, and from September 2026 many first sales of new homes pay less of it.
Panama's real estate transfer tax (ITBI) is 2% of the sale price or the registered (cadastral) value, whichever is higher. It is customarily paid by the seller, and it must be paid before the deed can be registered.
Law 546 of 2026, in effect from September 1, 2026, changes the tax on the first sale of a new home:
The first $120,000 of the value is exempt.
Between $120,000 and $200,000, only the amount above $120,000 is taxed, at reduced rates.
Above $200,000, the normal 2% applies to the amount over $120,000.
The deed must be signed within two years of the home's occupation permit (permiso de ocupación).
Because the seller pays this tax, the change mainly helps developers, though it can make new homes easier to price. It does not apply to resales. Our property tax guide has the full details; confirm how it applies to a specific unit with your attorney.
Running Costs After You Buy
Annual Property Tax
Property tax is charged on the registered (cadastral) value, not the market value, and the rates are progressive. As of October 2026:
Primary residence: first $120,000 exempt, 0.5% from $120,001 to $700,000, 0.7% above $700,000.
Second homes, rentals and lots: first $30,000 exempt, 0.6% from $30,001 to $250,000, 0.8% from $250,001 to $500,000, 1.0% above $500,000.
To get the primary residence rates you must be a citizen or legal resident who lives in the home and registers it with the DGI. Tax can be paid yearly or in installments due by April 30, August 31 and December 31. See our property tax guide.
HOA Fees and Utilities
Condos and gated communities charge a monthly HOA fee that covers security, common areas, insurance on the building and amenities. Fees vary widely by building and by unit size, so ask for the current fee, the latest budget, the reserve fund balance and any planned special assessments before you sign.
Electricity and water accounts are transferred into your name after closing. The electricity company usually asks for a refundable deposit. Internet and cable are new contracts. Ask the seller for recent bills so you know what to expect.
If You Finance Your Purchase
Through our lending partner, qualified foreign buyers can finance up to 75% of titled property. Banks require proof of income.
Bank Fees and Closing Costs
A loan fee of about 1% to 2% of the loan amount.
Loan closing costs of about 4% to 6% of the loan amount, which cover the bank's legal work and registering the mortgage at the Public Registry.
A property appraisal ordered by the bank.
Insurance
Banks require local life insurance for the length of the loan, and normally property insurance on the home as well. Premiums depend on your age, health and the property, so ask the lender for a quote early.
Rates, terms and current conditions are on our Mortgages and Loans page.
Worked Example: A $300,000 Resale Condo
Paying Cash
Price: $300,000
Attorney at 1% to 1.5%: about $3,000 to $4,500
Notary and Public Registry: about a few hundred dollars
Agent commission: $0
Transfer tax: paid by the seller
Total to close: about $303,500 to $305,500, or roughly 1.2% to 1.8% over the price.
If the registered value is $300,000, property tax would be about $900 a year as a registered primary residence, or about $1,720 a year as a second home.
With 75% Financing
Down payment (25%): $75,000
Loan (75%): $225,000
Attorney, notary and registry: about $3,500 to $5,500
Loan fee at 1% to 2%: about $2,250 to $4,500
Loan closing costs at 4% to 6%: about $9,000 to $13,500
Appraisal and first insurance premiums: quoted by the bank
Cash needed at closing: about $90,000 to $99,000, plus appraisal and insurance.
These are estimates only. Your lender and attorney will give you exact figures.
Buying Through a Corporation or Foundation
Some buyers hold property in a Panamanian corporation (S.A.) or a private interest foundation for estate planning or privacy.
What It Costs
Setting up the entity: a one-time legal fee that varies by firm.
Annual government fee: $300 a year for a corporation, and $400 a year for a foundation after its first year.
A yearly fee to the registered (resident) agent, which every entity must have.
Is It Worth It?
For many buyers, owning in their own name is simpler and cheaper. An entity can help with inheritance planning, but it adds yearly costs and paperwork, and buying an existing company that already owns a property needs careful legal review.
Ask your attorney, and your tax adviser at home, before deciding.
What It Costs to Sell Later
It helps to know the exit costs before you buy. When you sell, you will typically pay:
The 2% transfer tax, on the sale price or the registered value, whichever is higher.
Capital gains tax: Panama withholds 3% of the sale price or the registered value, whichever is higher, which most sellers accept as the final tax; you can instead file on the actual profit, with the 3% credited.
Your own legal fees, the listing agent's commission, and clearance certificates showing property tax and utilities are paid.
If you are planning a sale, our selling page explains how we market properties.
Get a Clear Cost Estimate Before You Commit
Tell us what you are looking for and we will walk you through the full cost of buying, from deposit to keys, at no cost to you as a buyer. Start the buying process or message us on WhatsApp at +507 6169-2453.
Our office is at Unit 1 Plaza Pedasí (Super Pedasí Plaza), Pedasí, Los Santos 7401.
Frequently Asked Questions
Do buyers pay a real estate commission in Panama?
Not with us. Buyers pay no commission when they buy with Panama Properties.
What are typical closing costs for a buyer in Panama?
Legal fees of about 1% to 1.5% plus small notary and Public Registry fees. The 2% transfer tax is customarily paid by the seller. On a cash purchase, total buyer costs are usually about 1.2% to 2% of the price.
Who pays the transfer tax in Panama?
The 2% transfer tax is customarily paid by the seller. It is charged on the sale price or the registered value, whichever is higher.
What did Law 546 of 2026 change?
From September 1, 2026, the first $120,000 of value is exempt from transfer tax on the first sale of a new home, if the deed is signed within two years of the occupation permit. Values between $120,000 and $200,000 are taxed at reduced rates, and the normal 2% applies above that. It does not apply to resales.
How much is property tax on a $300,000 condo?
If the registered value is $300,000, about $900 a year as a registered primary residence, or about $1,720 a year as a second home or rental, as of October 2026.
What does a mortgage add to closing costs?
Expect a loan fee of about 1% to 2% of the loan, loan closing costs of about 4% to 6% of the loan, an appraisal, and required life insurance. On a $225,000 loan, that is roughly $11,000 to $18,000 before appraisal and insurance.
Do I need a corporation or foundation to buy property?
No. Foreigners can own property in their own name with the same rights as Panamanians. An entity adds yearly government and agent fees, so only use one if your attorney recommends it.
Are HOA fees included in the price?
No. HOA fees are a monthly running cost set by each building or community. Ask for the current fee, the budget and the reserve fund before you sign.