Panama’s tropical climate and welcoming communities keep attracting expats from around the world. Add in the country’s affordable luxury properties and low cost of living, and it’s easy to see why so many are choosing to settle here.
Do you want to invest in real estate here as a foreigner? Here’s what you need to know before buying property in Panama.
Find a licensed local agent
Work with a licensed real estate agent who knows the Panama market and works regularly with expats. Your agent can request a title search through the public registry to confirm that the seller legally owns the property and that there are no legal issues or outstanding mortgages attached. If anything concerning comes up during this check, it’s best to hold off buying property in Panama until those issues are resolved — or start looking at other options here at KW Panama.
Understand current market values
Before you make an offer, your agent can provide insight into current pricing in the area, helping you determine whether a property is priced fairly. Once you’ve found a place you like, they can help you decide on a reasonable offer and handle negotiations with the seller until you reach an agreement.
Sign the purchase agreement
The purchase agreement outlines the full details of the sale, including conditions such as property inspections or a land survey if one hasn’t been done in the last decade.
A closing date will be scheduled after you sign the agreement. At that point, you’ll typically pay a 10% deposit. Both you and the seller will sign the final contract that completes the transaction on the day of closing.
Transfer the property title
In Panama, the government collects a 2% tax on the property’s declared value when transferring the title to the buyer. A few additional costs apply along with this tax, and they can vary depending on the property’s size and overall value. Common title transfer fees include:
- Notary and public registry fees ($250 to $400)
- Legal property transaction fee ($1,200 to $1,500)
- Escrow transaction fee ($600 to $1,000)
After transferring the title, the final version of the sale contract is prepared and signed by all parties involved. You’re allowed to sign the contract remotely if you’re buying property in Panama from abroad, or authorize a local attorney to do it for you.
Fund transfers
You need to open an escrow account for all property-related payments in Panama — either with a local bank or in your home country. The bank will issue an irrevocable letter of payment to confirm that the funds have been secured and release them once you meet the contract terms.
Register the property
Your agent will submit the purchase record to the public registry office in Panama City to start the title registration — a process that can take seven to ten days. Once the registration is complete, your agent will receive the final deed with the closing documents and send them to you along with your registered title deed.
Start your property search today
Browse Panama-Real-Estate.com to find listings that match your budget and lifestyle. You can also sign up with your email to receive updates on the latest properties. Have questions about buying property in Panama? Call +507 3680700 — we’re here to help.
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