Can Foreigners Buy Property in Panama?
Yes. Foreign individuals and companies can buy and register titled property in Panama on essentially the same terms as Panamanian citizens. You don't need a local partner, a residency permit or a special license. The answer is the same for US citizens, Canadians and Europeans: the limits depend on where the property is, not on your nationality.
The 10 km border zone
Article 291 of the Constitution bars foreign individuals and foreign companies from owning land less than ten kilometers from the borders. The ban also covers Panamanian companies whose capital is foreign, in whole or in part.[1] So putting the property in a Panamanian corporation does not get you around it. The rule affects parts of Chiriquí, Bocas del Toro and Darién. There is no official public map of the line, so for any property close to it, a surveyor should confirm the distance before you sign.
Islands
The same article allows island territory to be sold only for specific development purposes, when it is not a strategic or reserved area, and when it has been declared a special development area with legislation that protects national security.[1] Rights that were legitimately acquired before the Constitution took effect are respected.[1]
In practice, an island lot that is already titled and registered can be bought like any titled property. Much island and coastal land, however, is held only as rights of possession. Titling that land falls under Law 80 of 2009, which regulates titling in coastal zones and island territory.[2] If you are thinking of buying an island or island land, read our guide to buying land in Panama, titled land and rights of possession first.
Beachfront, protected areas and indigenous land
The first 22 meters inland from the high-tide line on the Pacific and 10 meters on the Atlantic are public domain. No one can own that strip, whatever a listing says. Building rights over the shore require a separate concession.
The state also will not title land inside protected areas, indigenous territories or mangroves.[3] Foreigners generally cannot buy inside indigenous comarcas at all.
Do you need residency to buy?
No. Buying property and getting residency are separate legal processes. Owning a home does not give you the right to live or work in Panama. A purchase can, however, be the qualifying investment for a residency visa, as explained in the residency section below.
How to Buy Property in Panama: The Legal Process Step by Step
Buying a house in Panama follows a fixed legal sequence, and each step produces a document that protects you. Most problems come from skipping the title check or paying before the promesa is signed. These are the steps for a titled resale property:
- Offer and reservation
You agree on price, closing date and what is included, often in a short reservation letter with a small refundable deposit. Make the offer conditional on a clean title check and, if you are financing, on bank approval. - Preliminary title check
Your lawyer pulls a certified Public Registry certificate on the property's finca (folio) number. The certificate covers ownership and recorded liens (gravámenes).[4] It shows whether the seller is the registered owner and whether the property carries mortgages, court seizures, easements or a previously registered promesa. Do this before anything becomes binding. - Promesa de compraventa
This is the binding promise to buy and sell. It sets the price, the deposit, the deadlines and who pays each cost. Under the Civil Code, a promise to buy or sell real estate must be in writing, and it lets the buyer demand that the seller complete the sale.[5] - Deposit
The deposit is typically 10% of the price. It should go into escrow or another controlled arrangement, never to the seller's personal account. The balance is usually paid at closing, often secured by an irrevocable bank payment letter if you are financing. - Full due diligence and clearances
Your lawyer checks the cadastral value, boundaries and survey, and the zoning. For a condo, this includes the building rules and any unpaid fees. The Registry will not record the sale without a paz y salvo showing the property is current on property tax (Article 792 of the Fiscal Code) and an IDAAN water paz y salvo. When a company is involved, the Registry also requires proof that its annual tasa única is paid.[6] - Deed before a notary
Buyer and seller, or their attorneys-in-fact, sign the escritura pública before a Panamanian notary. A sale of real estate must be in a public deed to be registered.[6] You will need your passport, proof and source of funds and the notary's anti-money-laundering forms. - Taxes and registration
The seller files the transfer tax and capital gains returns and pays them in the same calendar month, before the sale is registered.[7] The deed is then recorded at the Public Registry. Registration, not signing or paying, is what makes you the legal owner. Recording usually takes around two weeks.
If you buy a house in Panama City, Panama, or a unit in a tower, add the building checks: the condominium rules, the budget and reserve fund, whether owners are up to date on fees, and whether short-term rentals are allowed. Our guide to buying a condo or apartment in Panama covers the condominium regime and pre-construction contracts in detail.
What the promesa de compraventa should say
The promesa is where you win or lose most disputes, so read it as carefully as the deed. At a minimum it should state:
- The finca number, the exact area and what is included (parking, storage, furniture).
- The price, the deposit amount and where the deposit is held until closing.
- Conditions that let you cancel and recover the deposit: defects in title, failed financing, liens not cleared.
- A closing deadline, plus what happens to the deposit if either side misses it.
- Who pays each item: transfer tax, capital gains advance, notary, registry, broker commission, pending condo fees.
- The seller's duty to deliver the property free of liens and with all paz y salvos current.
A promesa signed as a public deed and recorded at the Registry limits the seller's ownership. While it stays registered, the seller cannot sell the property to someone else, or mortgage it, without your consent.[8] A registered promesa cannot run longer than four years.[8] Registration costs B/.10 to review plus B/.10 to record per property.[6] On a resale with a long gap between promesa and closing, registering it is cheap insurance. Developer contracts for off-plan units are also subject to consumer protection rules, which generally prohibit clauses that let only the developer cancel and keep your payments.
Where your deposit should sit
Pay deposits only into escrow, a bank or fiduciary account named in the promesa, or under a bank guarantee. Never pay into a seller's or agent's personal account. For off-plan purchases, insist on a trust with an authorized Panamanian bank or fiduciary, or on a bank guarantee. A plain developer payment plan gives you an unsecured claim against the developer if the project fails. We explain exactly how deposit and balance will be held in your file before you send any money.
Buying remotely with a power of attorney
You do not have to be in Panama to buy. You can sign a power of attorney before a notary in your country, legalized for use in Panama (usually by apostille). The person you appoint, often your lawyer, then signs the promesa and the deed for you. Limit the power to the specific property and transaction.
When we handle a purchase remotely, we send you the power of attorney text and run the title check. We then review the promesa with you by video call and sign at the notary on your instructions. Funds move only when the documents are in order.
Paying cash or getting a mortgage
Most foreign buyers pay cash. Panamanian banks do lend to foreigners, but generally for 60% to 80% of the value, with non-residents at the lower end. Terms usually run up to 20 years, and the bank focuses on verifiable income. Approval for a non-resident often takes 60 to 90 days, which pushes the closing back. Panama uses the US dollar, so there is no currency conversion at closing.
Plan for the bank as well. Opening a local account, or getting an incoming wire cleared, can take two to four weeks because of source-of-funds checks. Keep bank statements and sale documents that show where the money came from.
How long buying a home in Panama takes
For a titled resale paid in cash, expect about 30 to 90 days from accepted offer to registration. Bank financing, a corporate or foundation buyer, an estate sale, or a title that needs correcting can each add weeks. Off-plan units close when the building receives its occupancy permit, which can be years after you sign.
Titled Property vs Rights of Possession (ROP)
Titled property is ownership recorded at the Public Registry under a finca number. Rights of possession (derechos posesorios) are only a recognized right to occupy and use land that the state still owns. The Registry's own manual says a possessory right is not a property title.[8] For a $300,000 to $2 million purchase, buy titled property or have the land titled before you pay the full price.
| Feature | Titled property | Rights of possession (ROP) |
|---|---|---|
| Who owns the land | You, as registered owner | The state; you hold a right to possess and use it |
| Where it is recorded | Public Registry, under a finca number | Not in the Public Registry; local and agency records, often on paper |
| Proof of the seller's right | Certified Registry certificate | Certifications from local authorities, neighbor declarations, possession history |
| Bank mortgage | Yes | Generally no |
| Annual property tax | Yes, by value bands | Generally none until titled |
| Main risk | Liens or defects a title check will reveal | Competing claims from heirs or neighbors, boundary disputes, loss of possession if left unattended |
| Common in | Panama City, established towns, most condos | Rural land, beach and island property, Bocas del Toro |
As of October 2026. Tax treatment changes once ROP land is titled.
If you are still considering ROP land
Titling goes through ANATI, the land authority created by Law 59 of 2010, under Law 80 of 2009 and its regulation, Executive Decree 45 of 2010.[3] The applicant must show more than five years of peaceful, uninterrupted possession. Supporting evidence includes certifications from the corregiduría or mayor's office, at least three sworn statements from neighbors, photographs, surveys and utility contracts.[3] The land must also be eligible: not private, not a protected area, not an indigenous territory, not mangrove.[3]
Titling timelines vary widely. A clean file without opposition can finish in about a year. Many take one to three years, and an objection from a neighbor or heir adds more. The practical structure for a serious buyer is to pay a deposit and close only once title is issued, with the contract making titling the seller's job. The land-specific checks are in our guide to buying land in Panama.
Panama has two laws numbered 80, and buyers mix them up. Law 80 of 2009 governs possessory rights and titling on coasts and islands. Law 80 of 2012 is the tourism incentives law that frames short-term rental and tourism projects, covered in our guide to Panama Airbnb investment under Law 80 and licensing.
What Buying Property in Panama Costs: Fees, Taxes and Who Pays
On a cash purchase where the seller pays the transfer tax, your closing costs are about 1% to 1.5% of the price. That is roughly USD 2,700-4,700 at $300,000 and USD 9,000-15,500 at $1 million. If you agree to pay the 2% transfer tax, add that on top. Who pays what is a matter for your contract, so check every line of the promesa.
| Item | Typical cost | Who pays | Notes |
|---|---|---|---|
| Buyer's legal fee | Market range about 0.5%-1% of price | Buyer | Title check, promesa, deed, registration. We quote it as a fixed fee after a short consultation. |
| Public Registry certificates | Modest fee per certificate, plus B/.10 per extra page | Buyer | Usually handled within the legal fee |
| Promesa registration (optional) | B/.20 per property | Buyer | B/.10 review plus B/.10 recording |
| Notary | From a few hundred dollars to about 0.1%-0.25% of price | Buyer, generally | No single published schedule; higher on large deeds |
| Public Registry recording | B/.10 per property plus B/.3 per B/.1,000 of value (about 0.3%) | Buyer | Applied to cadastral value, which is often below the price |
| Transfer tax (ITBI) | 2% of the higher of price or cadastral value | Seller by law | Can be shifted to the buyer by contract |
| Capital gains tax | 10% of the gain, with a 3% advance on the higher of price or cadastral value | Seller | Paid before registration |
| Broker commission | Commonly 3%-7% | Seller, usually | Get it in writing; never assume from a listing |
| Appraisal, survey, inspection | Quoted per property | Buyer | Survey essential for land and houses near borders or the coast |
| Mortgage costs | Bank fees, required insurance | Buyer, if financing | Avoided entirely with a cash purchase |
| Company or foundation (optional) | Quoted separately | Buyer | Setup plus annual fees, if you hold title through one |
| Total buyer closing costs | About 1%-1.5% of price: USD 2,700-4,700 at $300,000; USD 9,000-15,500 at $1,000,000 | Buyer | Cash purchase, seller pays transfer tax. Add 2% of price if you take it on. |
Figures as of October 2026, in US dollars (the balboa trades at par). Government fees from the Public Registry tariff; professional fees are typical market ranges.
The registry fee is set by Resolution 212 of 2013: B/.10 per property to review the filing and B/.3 per B/.1,000 or fraction to record it.[9] The Registry applies that rate to the property's cadastral value.[10] The promesa registration fee is B/.10 to review plus B/.10 to record per property.[6]
Worked example at three price points
| Buyer cost | $300,000 home | $1,000,000 home | $2,000,000 home |
|---|---|---|---|
| Registry recording (about 0.3% + $10) | About $910 | About $3,010 | About $6,010 |
| Notary (0.1%-0.25%) | $300-750 | $1,000-2,500 | $2,000-5,000 |
| Legal fee (market 0.5%-1%) | $1,500-3,000 | $5,000-10,000 | $10,000-20,000 |
| Total, seller pays transfer tax | About $2,700-4,700 | About $9,000-15,500 | About $18,000-31,000 |
| Extra if you pay the 2% transfer tax | +$6,000 | +$20,000 | +$40,000 |
Figures as of October 2026. Assumes cadastral value equals price; where it is lower, registry cost falls. Legal fees at higher values usually land below 1% because fees scale.
Who pays the 2% transfer tax
All transfers of real property pay a 2% transfer tax under Law 106 of 1974, as amended.[11] The seller must file both the transfer tax return (Form 106) and the capital gains return (Form 107), and must be registered with the tax authority (DGI) to do so.[12] The base is the higher of the sale price or the cadastral value. Capital gains on a sale outside the seller's ordinary business are taxed at 10%, paid before the deed is recorded, together with the 2% transfer tax.[13]
In a seller's market, some sellers try to shift the 2% to the buyer. That is negotiable, but it should be a conscious trade-off reflected in the price, not a line slipped into the promesa.
New homes have their own rule. The first-sale exemption for new homes was repealed in April 2025. Law 546 of August 31, 2026 then restored an exemption for a first new home on the first B/.120,000, with reduced rates on the excess up to B/.200,000.[14] Most buyers in the $300,000-plus range should expect the standard 2% to apply to the sale. Confirm the rule for your unit and occupancy-permit date before you sign.
Annual costs after you buy
The main recurring cost is property tax, charged on cadastral value by bands. A home registered as your primary residence pays less than a second home or rental.[15]
| Cadastral value band | Primary residence (Patrimonio Familiar Tributario) | Other property (second home, rental) |
|---|---|---|
| Up to $30,000 | 0% | 0% |
| $30,001-$120,000 | 0% | 0.6% |
| $120,001-$250,000 | 0.5% | 0.6% |
| $250,001-$500,000 | 0.5% | 0.8% |
| $500,001-$700,000 | 0.5% | 1.0% |
| Above $700,000 | 0.7% | 1.0% |
Rates as of October 2026, from the DGI's published tables.
Calculated band by band, a second home with a cadastral value of USD 400,000 would owe about USD 2,520 a year. The same property registered as your primary residence would owe about USD 1,400. We confirm the calculation for your property, because cadastral value and any existing exemptions vary.
The primary-residence regime is governed by Law 66 of 2017.[16] It is not automatic: you have to apply for it, and the process can take several months.[17] Some buildings completed before 2019 still carry temporary exemptions on the value of the construction. Even then, a condominium unit with an improvements exemption still pays 1% a year on its land value.[15]
You get a 10% discount if you pay the full year before April 30 with no arrears. Otherwise, you can pay in three installments due April 30, August 31 and December 31.[15] Add condominium fees, insurance and, for rentals, management and income tax on Panama-source rent. The full breakdown is in our guide to Panama property taxes and closing costs for foreigners.
Have us handle it
Book a title check before you sign anything
A Panamanian lawyer reviews your situation and replies within 24 hours with next steps and a fixed-fee quote.
How to Hold Title: Personal Name, Corporation or Foundation
For a single home you live in, your own name is usually the simplest and cheapest choice. A corporation or a private interest foundation earns its annual cost when you own several properties, want privacy, or want the property to pass to your heirs without a court succession in Panama. Decide before the deed is signed. Moving the property into a company or foundation later is a new transfer, with new taxes and fees.
| Factor | Personal name | Panama corporation (S.A.) | Private interest foundation |
|---|---|---|---|
| Setup cost | None | Formation plus resident agent | Formation plus resident agent and council |
| Annual cost | None | Annual tasa única and agent fees | Annual tasa única and agent fees |
| On your death | Heirs generally go through a Panamanian succession process | Shares pass under your estate plan; still needs planning | Assets pass to beneficiaries under the foundation's rules, no court process |
| Mortgage | Easiest | Possible, more bank paperwork | Possible, more bank paperwork |
| Bank due diligence | On you | On the company and its beneficial owners | On the foundation, founder and beneficiaries |
| US reporting (Form 8938) | Property itself not reportable | Interest in the company may be reportable | Interest may be reportable; classification depends on terms |
| Best for | One home, simple estate | Rentals, several properties, joint investors | Succession and family wealth across borders |
As of October 2026. Costs depend on the structure; we quote them with the purchase.
When a corporation makes sense
A Panama corporation suits rental properties, partners buying together, or an investor building a portfolio. Each property can sit in its own company, which keeps liabilities separate. The trade-off is annual fees and a bank that will examine the company and the people behind it. It also adds a step at closing: the Registry requires proof that the company's annual tasa única is paid before it records the deed.[6] For the differences between entity types, see our comparison of Panama corporation vs LLC vs foundation.
When a foundation makes sense
A private interest foundation under Law 25 of 1995 holds the property for beneficiaries you name. When you die, the property stays in the foundation and the council follows your instructions. Your heirs do not need to open a court succession in Panama, which can take a long time and freezes the asset until it is done. Panama itself charges no inheritance tax, as our guide to Panama inheritance tax and estate planning explains. For setup, running costs and what US and Canadian families must report, see our guide to the Panama private interest foundation, cost and setup.
Rules that apply whatever you choose
The border rule applies to companies with foreign capital, so no structure makes property within 10 km of the border available to a foreign buyer.[1] If you plan to use the property for residency, the visa rules on holding through an entity matter too. In most cases a company or foundation is acceptable when you are its beneficial owner, but confirm this before closing. We form the structure before the deed so title goes into the right name the first time.
Buying a Home in Panama to Qualify for Residency
Owning property does not give you residency by itself. A purchase can, however, be the qualifying investment for three of Panama's main visas. The amount, the holding period and the paper trail of your funds all have to match the visa's rules, so plan the purchase and the visa together.
| Visa | Property requirement | Status granted | Key condition |
|---|---|---|---|
| Qualified Investor | USD 300,000 for a new property bought on first sale; USD 500,000 for a resale property | Permanent residency from the start | Your own funds from abroad, free of liens, held 5 years |
| Friendly Nations | USD 200,000 | Two-year provisional, then permanent | Citizenship of a listed country |
| Pensionado (retiree) | None required; property of USD 100,000+ lowers the pension minimum | Permanent residency | Lifetime pension of USD 1,000 a month, or USD 750 with the property |
As of October 2026. Thresholds change by executive decree; confirm the figure in force when you sign.
The Qualified Investor program was created by Executive Decree 722 of 2020.[18] Earlier decrees set different real estate amounts. Under Executive Decree 17 of 8 September 2026, in force since 16 September 2026, the minimum is USD 300,000 for a new property bought on first sale, with no end date, and USD 500,000 for a resale property.[19] The program had passed 700 investors by April 2026.[20]
Under the Qualified Investor visa, borrowed money does not count toward the minimum, although a mortgage can fund the price above it. Furniture, fees and developer rebates generally do not count either. A pre-construction unit can qualify if your payments go into a bank trust or are backed by a bank guarantee.
Under Executive Decree 17 of 2026, the USD 300,000 real estate threshold applies only to a new property bought on first sale, with no end date. A resale property requires USD 500,000.[19] If your plan depends on buying between USD 300,000 and USD 500,000, do not sign a non-refundable promesa until you have confirmed that the unit counts as a first sale of a new property.
Our guides cover each route in detail: the Panama Golden Visa (Qualified Investor route and cost), the Panama Friendly Nations visa and the Panama Pensionado retirement visa. When we handle both the purchase and the residency file, the deed, the source-of-funds trail and the visa application are built to match from day one.
Can US Citizens Buy Property in Panama? Yes. Here Is What the IRS Expects
US citizens can buy property in Panama on the same terms as any other foreigner. The IRS obligations depend on how you pay for and hold it, not on owning the property itself. Foreign real estate held directly, such as a personal residence or a rental property, does not have to be reported on Form 8938.[21]
Reporting starts in three situations:
- A Panamanian bank account. If your foreign accounts together exceed USD 10,000 at any time during the year, you must file an FBAR (FinCEN 114).[22] This includes an account used only to pay for the purchase or collect rent.
- Holding through a company or foundation. If the real estate is held through a foreign entity, your interest in the entity is a specified foreign financial asset. It is reported on Form 8938 when your total foreign financial assets exceed the threshold that applies to you.[21] Some structures also trigger separate entity filings.
- Renting it out. As a US citizen, you report worldwide income. Rent from a Panama property generally goes on Schedule E, whether or not the money comes back to the US. Panama also taxes that rent as Panama-source income, and there is no income tax treaty between the two countries.
Canadian residents have their own foreign-property reporting rules. Have your Canadian accountant review the holding structure before closing. For how Panama's territorial system treats your other income, see our guide to Panama taxes for expats.
Panama Real Estate Scams and Red Flags
Most Panama real estate scams follow a few known patterns, and a proper title check catches almost all of them before money moves. The risk is highest on land, beachfront and pre-construction, and with sellers who are not in Panama. Walk away, or stop and verify, if you see any of these:
- The seller is not the registered owner. The person selling should match the owner on a certified Registry certificate. If they act for the owner, check that their power of attorney is valid and covers this sale.
- Screenshots instead of a certified certificate. Online Registry lookups are useful but have no legal value. Your lawyer should rely on a certified certificate pulled close to the signing date.
- Deposit to a personal account. Requests to wire a deposit to an individual, an agent or an offshore account are the clearest warning sign there is.
- ROP land sold as "titled" or "title in process". If there is no finca number at the Public Registry, you are buying possessory rights, not ownership.
- An existing registered promesa or seizure. The Registry will not record your purchase while an earlier promesa remains registered and uncanceled on the property.[8] The same check reveals court seizures and mortgages.
- An estate sale without all the heirs. If a previous owner died, the succession must be completed. Every heir who inherited a share must also agree to the sale.
- "We'll put it in a company" near the border. A company with foreign capital is barred within 10 km just as you are.[1]
- Beachfront that includes the beach. A lot whose boundaries reach the waterline is selling public land you can never own.
- Off-plan payments straight to the developer. With no bank trust or guarantee, your money is unsecured if the project stalls.
- "Airbnb-ready" promises. Many Panama City buildings and zones prohibit stays under 45 days, and fines reach USD 50,000. A platform listing is not a permit.
- A price far from the market. Nearly identical units can be listed at very different prices. An independent appraisal costs little next to overpaying.
- "Use my lawyer." A broker can recommend, but your lawyer must work only for you. Check that the broker is licensed, and look for membership in ACOBIR, the national brokers' association.
The fix is the same for all of them: verify title before you pay. Send us the finca number, or the listing and the draft contract, through the contact options at the end of this page. We will tell you whether the property is clean before you sign anything. For a broader look at title and due diligence work, see our page on hiring a Panama real estate lawyer for title and due diligence.