Panama: First-World Convenience at Third-World Prices – Buying Real Estate

Buying Real Estate

Anyone can own property in Panama. Because foreigners have the same property rights as Panamanians, capitalizing on the opportunities here is easy.

Purchasing Procedure

  • Step 1: Confirm the title. Prospective buyers should always confirm title first. Once you have found the property for you, ask the owner for two documents—the public deed containing the title (Escritura) and the Ownership and Encumbrances Certificate (Certificado de RegistroPúblico) from the Public Registry. If these documents are not available, ask the seller for a property (finca) number. With this information, your lawyer will be able to search for the title at the Public Registry.
  • Step 2: Enter into a Promise to Buy-Sell Agreement. Once you have verified title, the next step is to sign a Promise to Buy-Sell Agreement. This usually entails giving the seller a down payment (often 10% of the agreed-upon purchase price) and setting a date for the transfer of title. Normally there is a penalty if either party backs out.
  • Step 3: Transfer the title. Once the Promise to Buy-Sell Agreement is completed, your lawyer will draft the final purchase and sale contract. All parties will then need to go to a notary public to sign the deed.
  • Step 4: Transfer the funds. The safest way to pay the balance of the purchase price is through an irrevocable letter of payment from a local bank in Panama. Your lawyer should be able to assist you in obtaining this document in which the bank irrevocably promises the seller to pay the balance of the sale price upon the transfer of the title to the buyer.
  • Step 5: Record your purchase at the public registry. Finally, your lawyer or real estate agent can help you record your purchase at the public registry (the sale isn’t final until you do this.) This process normally takes a few weeks, but it can be done in about 10 days by having your attorney file the documents directly at the main office of the public registry in Panama City.

Buying Restrictions

Panamanian law allows for both nationals and foreigners to purchase titled property in Panama. Like most nations, Panama prevents foreign persons or Panama corporations with foreign ownership from purchasing property located less than 6.2 miles from its international borders with Costa Rica and Colombia. For all buyers, foreign and domestic, property within 22 meters (just over 72 feet) of the shoreline is deemed public and will not count toward square footage owned.


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