Step-by-Step Guide to Buying Real Estate in Panama

1. Find a Reputable Real Estate Agent

A good real estate agent in Panama is invaluable when navigating the buying process. Unlike North America or Europe, Panama does not have a centralized MLS system, meaning that not every property is publicly listed.
Because of this, choosing the right realtor—one with a strong local network and market knowledge—is essential.
 

At Panama Properties, we pride ourselves on our professionalism, ethics, and deep experience across Panama’s key markets—Pedasí, Boquete, Bocas del Toro, and Panama City. We help clients find real opportunities that match their lifestyle and budget, not just listings.
 

💡 Tip: Ask for referrals, check reviews, and ensure your agent is legally registered and familiar with expat transactions.
 

2. Find the Right Area First—Then the Right Home

One of the biggest mistakes new buyers make is falling in love with a property before understanding the community and climate.
Panama offers everything from tropical beaches to cool mountain retreats, and each region has its own rhythm, weather, and culture.

Ask yourself:

• Do you prefer the ocean breeze or the mountain mist?

• Is year-round heat comfortable for you?

• Are you close enough to schools, hospitals, and grocery stores?
   

👉 Remember: it’s more important to love where you live than just what you live in.
Explore our Panama Real Estate Guide for regional insights on where to buy.

The Importance of Professional Real Estate Assistance
 

3. Research and Plan Your Budget

Start by defining your total budget—not just the purchase price. Include:

• Closing costs

• Legal and notary fees

• Property registration

• Taxes and ongoing maintenance
   

👉Use online listings to get an idea of current market prices in your desired area. Panama Properties can also help you estimate a realistic budget based on your goals—whether that’s retirement living, investment income, or vacation rentals.

 

Understanding property taxes in Panama

 

​Panama Property Tax Information Guide

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4. Choose the Right Property Type

Panama offers diverse property types suitable for every buyer:

• Condos: Ideal for expats or retirees wanting convenience, security, and amenities.

• Single-family homes: Perfect for families who value privacy and outdoor space.

• Land: Great for investors or those who want to build their dream home in Panama.
   

👉At Panama Properties, we help clients understand the pros and cons of each property type based on location, legal status, and resale value.
 

If you have completed the steps above then it is time to start letting us help you. Fill out our client information form so we can start helping you find your ideal property in Panama

CLICK HERE  if you have done the steps above and want to beging the buying process

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5. Visit Properties

Once you’ve narrowed your search, schedule property visits. Take detailed notes and photos, and ask your agent key questions:

• Does the property have a clean, registered title?

• Is there a valid listing contract with the seller?

• Has any due diligence already been completed?
   

👉Inspect the home carefully, check utilities and community amenities, and get a feel for the area’s accessibility and safety.
 

6. Make an Offer

Once you’ve found your ideal property, your agent will help you determine a fair offer based on local market data.
Negotiation is standard in Panama, so don’t hesitate to discuss terms.

At Panama Properties, we begin with a verbal offer to confirm basic terms, then prepare a formal written offer letter for both buyer and seller to sign. This letter is then submitted to the lawyers representing both sides to start the next legal step.
 

7. Sign the Promise to Purchase Agreement

When both parties agree, your lawyers will draft a Promise to Purchase Agreement (PPA). Review this carefully with your attorney to confirm:

• Property details and legal description

• Purchase price and payment terms

• Deposit and timeline
   

👉Typically, a 10% deposit is paid into a trust or escrow account once the PPA is signed. This deposit becomes non-refundable and released to the seller after due diligence is complete.
 

8. Conduct Due Diligence

Due diligence is a critical step to ensure the property is free of debts, liens, or ownership disputes.
Your lawyer will verify the property title, ownership chain, and municipal taxes.

👉Never skip this process—it’s your protection as a buyer.
 

9. Arrange Payment or Financing

Most foreign buyers in Panama complete cash purchases via international wire transfer. The initial 10% deposit goes to the lawyer or escrow company, and the remaining 90% is transferred directly to the seller at closing.
 

If you need financing, Panama Properties has partnerships with local mortgage brokers and international lenders who offer loans to foreigners—a relatively new but growing option.

 

New mortgage options for foreigners in Panama
 

10. Complete the Closing Process

The closing process in Panama involves signing the property deed (Escritura Pública) at a Notary Public, followed by registration in the Public Registry.
This can be done:

• In person

• Through your lawyer with Power of Attorney

• Via your corporation or foundation’s legal representative
   

Once registered, the title officially transfers to your name or entity.
 

11. Navigating Legal Structures for Foreign Buyers

Panama is one of the most foreign-friendly real estate markets in Latin America. Foreigners can own property outright with the same rights as Panamanians.

You may also consider ownership through:
 

Foundations (Private Interest Foundation)

A foundation can hold the title to your property, offering asset protection and estate planning benefits.
At Panama Properties, we often recommend this for foreign buyers who want a long-term ownership structure.
 

Corporations (Sociedades Anónimas)

Owning property through a corporation may provide tax flexibility and easier transfer options.

Always consult your lawyer to determine the best structure for your goals.
 

12. What Fees Does a Buyer Pay in Panama?

Buying real estate in Panama is relatively low-cost compared to other countries.

Typical fees include:

• Attorney’s fees: Usually 1% of the purchase price

• Notary fees and registration: A few hundred dollars, depending on value

• Escrow or trust fees (if used): Small administrative cost
   

👉Sellers, not buyers, typically pay the transfer tax and capital gains tax.
 

13. Understanding Property Taxes in Panama

Under Law 66, Panama offers excellent property tax exemptions for primary residences:
 

Property ValueTax Rate
 

• Up to US$120,000Exempt (0%)

• US$120,001 – US$700,0000.5%

• US$700,001 or more0.7%
   

👉To qualify for the Primary Residence Exemption, owners must register the property with the DGI and provide identification, property title certification, and a sworn declaration.
 

✅ Final Thoughts

Buying property in Panama can be a smooth and rewarding process when guided by experienced professionals. From finding your dream location to finalizing the legal paperwork, Panama Properties is here to make your journey effortless and transparent.

 

 CLICK HERE  to fill out the buying information form and start your Panama Real Estate Adventure

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📲 Contact Panama Properties today to start your search and get personalized guidance through every step of purchasing your Panama home or investment.

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