Common Mistakes When Buying Property in Panama (And How to Avoid Them)

Buying property in Panama offers outstanding opportunities for investors, retirees, and lifestyle buyers. However, the Panamanian real estate market has unique legal, financial, and practical considerations that can surprise unprepared buyers — especially foreigners.

At United Country Panama, we’ve helped buyers successfully navigate land, rural, agricultural, and lifestyle property purchases across the country. Below are the most common mistakes when buying property in Panama, and exactly how to avoid them.

1. Not Hiring an Independent Real Estate Attorney

One of the biggest mistakes buyers make is relying solely on a broker or assuming contracts work the same way as in their home country.

In Panama:

• All contracts are legally binding once signed

• Real estate law is governed under civil law (not common law)

• Most documents are in Spanish

👉 How to avoid it:
Always hire an independent Panamanian real estate attorney to review title, contracts, taxes, and zoning before any deposit is paid.

2. Buying Property That Is Not Properly Titled

Many rural and coastal properties are marketed as Right of Possession (ROP) rather than fully titled land. While ROP may be legal in some cases, it carries higher risk and resale limitations.

Common risks include:

• Difficulty reselling

• No bank financing

• Potential disputes over ownership

👉 How to avoid it:
Work with experienced professionals who specialize in titled rural and agricultural properties, like United Country Panama, and verify ownership through the Public Registry.

3. Skipping Due Diligence to “Move Fast”

Buyers often feel pressure to act quickly — especially when they see attractive prices. This leads to:

• Incomplete title searches

• Missed liens or unpaid taxes

• Overlooking access or utility issues

👉 How to avoid it:
Take the time to complete full due diligence, including legal review, property access verification, and land-use confirmation.

4. Buying Without Visiting the Property or Area

Online listings don’t always reflect:

• Road access conditions

• Flood risks

• Distance to services

• Noise or neighboring land use

👉 How to avoid it:
Visit the property in person or work with a local broker who knows the region on the ground — especially important for farms, ranches, and rural land.

5. Ignoring Zoning and Land-Use Restrictions

Not all properties can legally be used for:

• Short-term rentals

• Agricultural production

• Commercial activities

• Subdivision or development

👉 How to avoid it:
Confirm zoning, land classification, and permitted uses with your attorney and local municipality before closing.

6. Underestimating Closing Costs and Taxes

Many buyers focus only on the purchase price and forget additional costs such as:

• Transfer tax (2%)

• Capital gains retention (3%)

• Legal fees (typically 1–2%)

• Notary and registration costs

• Ongoing property taxes and HOA fees

👉 How to avoid it:
Request a full cost breakdown early in the buying process so there are no surprises.

7. Expecting Quick Profits or Easy Property Flips

Panama is generally a long-term investment market, especially for land and rural properties. Liquidity varies greatly by location and property type.

👉 How to avoid it:
Invest with a medium- to long-term strategy, focusing on:

• Location fundamentals

• Infrastructure development

• Agricultural or lifestyle value

8. Not Understanding Foreign Ownership Rules

Panama allows foreigners to own property with the same rights as locals — but there are exceptions:

• Border zones

• Certain beachfront regulations

• Maritime concessions

👉 How to avoid it:
Verify ownership eligibility and restrictions before making an offer, especially for coastal or remote land.

Why Work With United Country Panama

At United Country Panama, we specialize in:

• Rural, agricultural, and recreational land

• Lifestyle and retirement properties

• Large acreage, farms, and ranches

• Local market expertise across Panama

We work closely with attorneys, surveyors, and local authorities to ensure secure, transparent transactions for both local and international buyers.

👉 Looking to buy property in Panama?
Contact United Country Panama for expert guidance and verified property opportunities.

Frequently Asked Questions (FAQ)

Can foreigners buy property in Panama?
Yes, foreigners can own property with the same rights as Panamanian citizens, with limited geographic exceptions.

Is buying land in Panama safe?
Yes — when proper due diligence, legal verification, and professional representation are used.

Do I need residency to buy property in Panama?
No, residency is not required to purchase real estate.