Is rental property worth buying in Panama?

Why does rental property in Panama look interesting again?

Because tenants and visitors keep coming while developers have slowed down, and rents are rising faster than prices.

The economy has picked up. GDP grew 4.4% in 2025 and 5.5% in the first half of 2026 (INEC), and the World Bank expects 4.2% for the full year. That's enough to support jobs, new households and company rentals.

Tourism is growing faster. The Panama Tourism Authority (ATP) counted just over 3 million international visitors in 2025, up 8.2%, with tourism receipts up 9.7% to $6.58 billion. The first half of 2026 brought 1.75 million visitors, 17.4% more than a year earlier.

Construction has slowed. Convivienda data compiled by Global Property Guide show about 10,600 occupancy permits in 2025 across the markets it tracks, roughly 30% fewer than in 2024 and about 40% below the 2022 peak.

And the yield has gone up, not down. In ACOBIR's broker data, signed rents rose 8.9% in a year while closed prices fell 1.7%, so the gross yield rose from 7.89% to 8.74%. Inflation is back too, at 2.8% over the 12 months to September 2026, after close to zero in 2025.

Current signal	Latest evidence	Change	What it means for landlords
International visitors	3.00M in 2025	+8.2%	More accommodation demand
Visitors, first half 2026	1.75M	+17.4%	Growth sped up this year
Tourism receipts, 2025	$6.58B	+9.7%	Visitors are spending more
Occupancy permits, 2025	10,600 units	-30%	Less new supply
GDP, first half 2026	+5.5%	Faster than 2025 (+4.4%)	Supports local rental demand
Signed rents, H1 2026 (ACOBIR)	$12.57/m²	+8.9%	Rents beat prices (-1.7%)

Are Panama City rents actually high enough to make buying worthwhile?

Yes. On real deals, a Panama City apartment earns about 8.7% of its price in rent each year, before costs.

The best number comes from closed transactions. ACOBIR's broker MLS recorded apartment sales at $1,726 per m² and signed leases at $12.57 per m² a month in the first half of 2026. On 100 m², that's a $172,600 apartment renting for $1,257, so 8.74% gross.

Asking-price data come out lower. Global Property Guide puts Panama City at 7.57% gross and the country at 6.94%, and its typical two-bedroom costs $245,000 and asks $1,650 a month (8.08%). Asking prices run high: TuLugar's listings average $2,244 per m² in the Panama District in October 2026, well above ACOBIR's closed $1,726.

So a fair starting range for a decent Panama City rental is 7% to 8.7% gross. Double-digit yields exist, but treat them as a question about the building, not a base case.

That's high for a dollar market. Plenty of popular international cities give investors 2% to 4% before costs.

Panama City segment	Typical asking price	Monthly rent	Gross yield
Studio / 1-bedroom	$235,000	$1,650	8.43%
2-bedroom	$245,000	$1,650	8.08%
3-bedroom	$400,000	$2,500	7.50%
4+ bedrooms	$1.05M	$5,500	6.29%
City average (asking)	—	—	7.57%
100 m², closed deals (ACOBIR H1 2026)	$172,600	$1,257	8.74%

Sources: Global Property Guide (asking prices and rents); ACOBIR Xposure MLS (closed sales and signed leases). Each yield uses one source only.

Is an 8% Panama rental yield really an 8% return?

No. On a real example, 8.74% gross becomes 5.62% after costs if you manage it yourself, 4.46% with a manager, and less again after income tax.

Take the ACOBIR apartment: 100 m², $172,600, renting for $1,257 a month. That's $15,084 a year if it's never empty.

Now take off the costs. One month of vacancy ($1,257). A PH fee of $2 per m² a month, the middle of PanamaProp's $1.50–$2.50 range for standard buildings ($2,400 a year). Property tax on the investment bands ($856). Repairs and insurance at our own allowance of 0.5% of the price ($863). That leaves $9,708, or 5.62%.

With a manager, add 10% of collected rent and one month's rent every two years to find a tenant ($2,011 together). That leaves $7,697, or 4.46%.

Then income tax. At 15%, you keep $8,252 (4.78%) self-managed or $6,543 (3.79%) with a manager. The old rule of thumb that net is 1.5 to 2 points below gross is too kind: here the gap is 3.1 to 4.3 points before tax.

Example: 100 m², $172,600	Self-managed	With a manager
Gross rent, 12 months	$15,084 (8.74%)	$15,084 (8.74%)
One month of vacancy	−$1,257	−$1,257
PH fee ($2/m²/month)	−$2,400	−$2,400
Property tax (investment bands)	−$856	−$856
Repairs and insurance (our 0.5% allowance)	−$863	−$863
Management (10%) and tenant placement	—	−$2,011
Net before income tax	$9,708 (5.62%)	$7,697 (4.46%)
After 15% income tax	$8,252 (4.78%)	$6,543 (3.79%)

Is a 4% to 5% net yield in Panama actually good?

Yes, if the apartment is easy to rent and the building is solid. You get it in dollars, which matters more than it looks.

Panama uses the US dollar, with the balboa fixed at 1:1. For a dollar-based investor, there's no currency risk eating the return.

A 4.5% yield in a country whose currency drops 10% in a year is a very different investment from a 4.5% yield collected in dollars.

Still, we'd want more than a bare 4% from an illiquid apartment that needs managing. At 8% gross, our scaled example leaves about 5.1% before income tax self-managed, or 4.1% with a manager. At 6% gross, it's 3.9% and 3.1%.

So a unit priced at 5% to 6% gross leaves very little room for a heavy PH fee, a bad tenant or a broken lift. That's the one to walk away from.

Does financing a Panama rental still make sense now?

Not for cash flow. At the rate a foreign buyer actually pays, the mortgage costs more than the apartment earns.

The SBP reference rate is 6.5% in 2026, but that's a regulatory benchmark, not the offer made to a foreigner. Banco General's 2026 grid for a second home or investment is 8% plus 1% FECI, so about 9%, with 70% of the price at most over 20 years. Non-residents are assessed case by case.

On our $172,600 apartment, a 70% loan means borrowing $120,820. At 9% over 20 years, that's about $13,045 a year. Net rent before income tax is $9,708 self-managed, so you're $3,336 short every year, or $5,347 with a manager.

Even 50% financing barely works: $9,318 a year of payments leaves $391 self-managed and a loss with a manager.

Banks have slowed down too: new mortgage lending fell about 13% from January to August 2026. Panama works for cash buyers. If you need a loan, run the numbers with 9%, not 6.5%.

Financing (9%, 20 years)	Loan amount	Annual payments	Cash flow before tax (self-managed / with manager)
Cash	$0	$0	+$9,708 / +$7,697
50% of price	$86,300	about $9,318	+$391 / −$1,620
60% of price	$103,560	about $11,181	−$1,473 / −$3,484
70% of price	$120,820	about $13,045	−$3,336 / −$5,347

Are Panama City's most expensive neighborhoods the best rental investments?

No. In the prestige areas, prices run well ahead of rents, so the yield drops.

PanamaProp's October 18, 2026 map of active listings puts Costa del Este at about $2,542 per m² and Punta Pacífica at $2,408. San Francisco lists at $1,889, Obarrio at $1,923 and El Cangrejo at $2,025.

Rents do rise in the premium districts, just not as much. Costa del Este rents near $15 per m² a month against about $13 in San Francisco: about 15% more rent for about 35% more price.

That's why Costa del Este comes out at 7.1% gross and Punta Pacífica at 7.0%, against 8.3% in San Francisco and 9.1% in Punta Paitilla. Marbella, at $3,750 per m², falls to 4.8%.

For a landlord, the best part of Panama City is often one step below the trophy market.

Where are Panama City's best rental yields right now?

Punta Paitilla, Coco del Mar, San Francisco and Obarrio lead in October 2026, with El Cangrejo close behind.

PanamaProp's map, built from active listings on October 18, 2026, puts Punta Paitilla at 9.1% gross, Coco del Mar at 9.0%, San Francisco at 8.3%, Obarrio at 8.1% and El Cangrejo at 7.7%.

Vaca Group's July 2026 study of 3,199 listings ranks the same areas in a similar order with lower numbers: Obarrio 7.35%, Bella Vista 7.08%, El Cangrejo 6.91%, San Francisco 6.84%, Punta Pacífica 5.98% and Costa del Este 5.84%. Two samples, one pattern.

Don't copy these into a spreadsheet as they are. They come from asking prices and asking rents, and the building, furniture and size change the result a lot.

El Cangrejo gives you a walkable, central address without Costa del Este prices. San Francisco has a deep tenant pool. Bella Vista and Avenida Balboa can work, but the gap between good and bad buildings is wide: check the PH fee and the lifts.

Area	PanamaProp, Oct 2026	Vaca Group, July 2026	Our read
Punta Paitilla	9.1%	—	Strong, check building age
Coco del Mar	9.0%	—	Good yields on smaller units
San Francisco	8.3%	6.84%	Large, varied rental market
Obarrio	8.1%	7.35%	Offices nearby, steady tenants
El Cangrejo	7.7%	6.91%	Good rent-to-price balance
Bella Vista	—	7.08%	Very building-dependent
Costa del Este	7.1%	5.84%	Strong tenants, weaker return
Punta Pacífica	7.0%	5.98%	More premium than yield
Marbella	4.8%	—	Priced for prestige

Gross yields on asking prices and asking rents. The two studies use different listings, so compare the ranking, not the decimals.

Are small Panama apartments better rental investments than big ones?

Usually, yes. Small Panama City apartments earn more rent for every dollar you put in.

In Global Property Guide's Panama City data, studios and one-bedrooms show 8.43% gross, two-bedrooms 8.08%, three-bedrooms 7.50% and four bedrooms or more only 6.29%.

The reason is simple: extra bedrooms, terraces and views push the price up faster than the rent.

PH fees widen the gap because they're charged per m². At $2 per m², a 200 m² apartment pays $400 a month before anything else.

For a rental, a good one- or two-bedroom near offices, shops and transport usually beats a big prestige unit. Large apartments suit families and corporate tenants who stay for years, so you get stability, not a higher yield.

Is Panama City's old apartment oversupply problem getting better?

Slowly. Fewer towers are going up, but Panama City still has a lot of unsold new condos, and that's your bargaining power.

Convivienda data show about 10,600 occupancy permits across tracked markets in 2025, around 40% below the 17,729 units delivered in 2022.

Sales have dropped faster than construction, though. New-home sales fell 39.5% in 2025, from 4,737 to 2,866 units (4S Real Estate, via La Prensa), with 1,292 in the first quarter of 2026. Developers still had 15,499 new units for sale in Panama City in May 2026, 11% fewer than a year earlier (Panama Equity).

For a buyer, that's room to negotiate. On our $172,600 example, 10% off the price lifts the gross yield from 8.74% to 9.71%. Ask towers with lots of empty units for a discount, paid furniture or a PH fee holiday, and get it in the contract.

The catch: a tower full of investor-owned units competes with itself for tenants. Before buying, count how many similar units in the building are listed for sale and for rent, and how long they've been online.

Is Airbnb a better investment than a long-term rental in Panama?

Usually not in Panama City. The visitors are there, but the rules and the numbers make ordinary Airbnb investing much harder than it looks.

In the Panama District, Article 21 of Law 80 of 2012 bans rentals shorter than 45 days without tourist-accommodation authorization from the ATP, with fines of $5,000 to $50,000, advertising included. The ATP still applies it: Avenida Balboa apartments drew $5,000 fines in 2026.

The law may change, but it hasn't yet. Bill 301 passed its first debate in January 2026 and would set up an ATP register with 10% ITBMS. Bill 713 would repeal Law 80 with 15% ITBMS but hasn't reached first debate. Neither was law on October 28, 2026.

Your building can block you anyway. PH rules can ban short stays, and a new law wouldn't override them. Ask for the building's reglamento before you sign.

The income is less exciting than the nightly rate. On AirROI, the average Panama City listing grossed $13,845 between October 2025 and September 2026, at $113 a night and 50.2% occupancy; one-bedrooms grossed $13,300. That's before Airbnb's 15.5% host fee, short-term management of 15%–25% (Vaca Group), cleaning, utilities, furniture and 10% ITBMS on lodging. On our numbers, an average two-bedroom nets about 2.1% self-managed and 0.5% with a manager before income tax, against 5.62% and 4.46% for a long lease (see our Panama Airbnb article).

The realistic middle ground is a furnished lease of 45 days or more for relocating staff, consultants and long-stay visitors. Furnishing a one-bedroom costs about $5,500 to $9,500 (Casa Suarez, July 2026).

Strategy	Typical stay	Management cost	Main issue
Long-term rental	12+ months	8%–12% of rent	Lower upside, simpler to run
Furnished medium-term	45+ days	Between the two	Smaller tenant pool, furniture to buy
Nightly Panama City rental	Under 45 days	15%–25% of revenue	ATP permit, PH rules, fines
Beach or mountain town rental	Variable	15%–25% of revenue	Low occupancy, local rules

Management fees: Vaca Group, September 2026.

Does Panama's tourism growth still help normal landlords?

Yes, but indirectly: through jobs, business travel and demand for furnished apartments, not through nightly rentals.

Tocumen handled about 20.9 million passengers in 2025, while roughly 2.24 million visitors entered Panama through the airport, around 10% more than the year before.

Those travelers feed much more than hotels. Aviation, logistics, restaurants and international companies all grow with them, and the people working there need apartments.

Panama City also gets contractors, executives and employees relocating for a few months. That's the market for furnished stays of 45 days or more.

Keep the scale in mind. Panama City isn't a resort, so an apartment there still needs to suit normal residents and expats when tourism slows.

Do Coronado, Boquete, Bocas del Toro or Pedasí rent out better than Panama City?

Not on the numbers we have. Outside the capital, average Airbnb listings earn less and sit empty most nights.

AirROI's data for the last 12 months put average gross revenue per listing at $11,656 in Coronado (190 listings, 28.4% occupancy), $9,700 in Boquete (80 listings, 37.6%), $13,745 in Bocas del Toro (461 listings, 31.7%) and $10,320 in Pedasí (73 listings, 29%). Panama City's average is $13,845 at 50.2%.

Busy months are short. Coronado's occupancy peaked at 49.9% in February 2026 and fell to 22.6% in June. Boquete went from 52.9% in January to 28.1% in May.

Long lets are cheaper there. RadarPanama's October 2026 survey of ads puts a two-bedroom in Coronado or San Carlos at $900–$1,500 a month unfurnished and $1,600–$2,500 furnished, and in Boquete at $450–$700, or $700–$1,200 for the furnished expat market.

Prices aren't low enough to make up for it. Listed apartments in Boquete average about $3,350 per m² and in Pedasí about $4,000 per m² (TuLugar, October 2026), above Panama City's closed $1,726.

Boquete also has its own municipal 45-day rule. In Coronado, Pedasí and Bocas, check the gated community's or building's rules. And after the October 9, 2026 earthquake near Tonosí, a magnitude 7.5-7.7 earthquake (agencies differed), ask what the insurance covers before buying on the Azuero peninsula.

These towns suit a buyer who will use the place too. As a pure rental, Panama City still wins.

Market (AirROI, last 12 months)	Listings	Occupancy	Average nightly rate	Gross revenue per listing
Panama City	978	50.2%	$113	$13,845
Bocas del Toro	461	31.7%	$160	$13,745
Coronado	190	28.4%	$177	$11,656
Pedasí	73	29%	$152	$10,320
Boquete	80	37.6%	$124	$9,700

Gross bookings before cleaning, management, utilities and 10% ITBMS. Periods: October 2025–September 2026 (Panama City, Coronado, Boquete) and August 2025–July 2026 (Bocas del Toro, Pedasí).

Can foreigners safely own and rent property in Panama?

Yes. A foreigner can hold a title in their own name, registered at the Public Registry, without a residence permit.

PROPANAMA says foreign investors have the same basic rights and obligations as local ones. The exceptions are land within 10 km of the borders and some islands, and "possession rights" (derechos posesorios) aren't a title at all.

The real risks sit in the deal, not your passport. Check the registered owner, mortgages, liens, cadastral details, unpaid PH balances (a debt to the building follows the unit, so ask for the paz y salvo), building rules and anything that limits renting.

Get an independent lawyer, especially for a resale. A cheap price loses its appeal fast if the unit comes with debts or a building dispute. Panama left the EU's tax blacklist (Annex I) on October 9, 2026 and isn't on the FATF grey list, which makes opening accounts and moving money a little easier.

Is Panama landlord-friendly enough for a normal rental business?

Yes, for the kind of apartments foreign investors usually buy. Market-rate leases are more flexible than the old tenancy law suggests.

Law 93 of 1973 contains tenant protections that sound strict when read alone. Later regulation excluded residential rents above B/.150 a month from much of that framework and left higher leases largely to the contract.

That threshold is so low that almost every investment apartment in Panama City falls in the flexible category.

There are formalities. MIVIOT says leases must be registered with it, the standard security deposit is one month's rent, paid through its deposit procedure, and extra charges like maintenance must appear in the contract to count in a dispute (MIVIOT via SERTV, September 2026).

In practice, a good contract and good tenant checks matter more than fears about rent control. Have a local lawyer draft the lease, especially if you'll need to enforce it from abroad.

How much do Panama taxes and condo fees cut into rental returns?

A lot more than most buyers expect. On our example, the PH fee and property tax alone take about 1.9 points off the gross yield, before income tax.

Property tax (IBI) uses the investment bands for a rented unit, because it isn't your main home: 0% up to $30,000, 0.6% from $30,000 to $250,000, 0.8% from $250,000 to $500,000 and 1% above. On $172,600, that's about $856 a year. Check the property's record: some older buildings still have an exemption on improvements, and the cadastral value can be lower than the price.

Rental income is taxed in Panama even if you live abroad. For individuals: 0% up to $11,000 of net taxable income, 15% up to $50,000 and 25% above (PwC, August 2026). A single apartment with no other Panama income may stay in the 0% band, but we use 15% as the base case. There's no confirmed flat withholding rate for non-residents, so have a local accountant handle the filing.

Owning through a company costs more. A Panamanian S.A. pays $300 a year in tax plus about $300 for a resident agent, and companies pay 25%. That takes our example down to 3.96% self-managed and 3.08% with a manager.

PH fees hurt most. PanamaProp's April 2026 guide puts them at $1.50–$2.50 per m² a month in standard buildings and $2.50–$4.50 in premium towers. On 100 m², a $300 fee takes 24% of a $1,257 rent before anything else.

That's why two apartments with the same price and rent can give very different returns. Ask for 12 months of PH statements before you make an offer.

Cost	Effect on a 100 m², $172,600 rental
Property tax (investment bands)	About $856 a year
PH fee	$150–$250 a month (standard), $250–$450 (premium)
Management	8%–12% of collected rent (long lets)
Repairs and insurance	Our allowance: 0.5% of the price, about $863 a year
Vacancy	About one month a year
Income tax	0%, 15% or 25% of net taxable income; 25% through an S.A.

Is an older Panama apartment often a better deal than new construction?

Often, yes. The price discount on an older unit is usually bigger than the rent discount.

PanamaProp's building data show central apartments from about $1,200 per m² in older stock to more than $3,000 in new or premium towers. Rents don't triple across that range.

A $160,000 older apartment renting for $1,200 a month yields 9% gross. A newer $260,000 apartment renting for $1,500 yields about 6.9%.

So the older unit can absorb more repairs and still come out ahead. But age alone isn't an advantage. Panama's climate is hard on buildings: humidity, salt, façades, plumbing, lifts, waterproofing and air conditioning can all turn into big bills.

New has one tax edge since September 1, 2026: under Law 546, the first sale of a new home pays no transfer tax (ITBI) on the first $120,000. The seller normally pays that tax, so use it to push the price down. The sweet spot is often a proven 5- to 15-year-old resale building with a healthy reserve fund.

Is selling a Panama rental property harder than buying one?

Yes. Selling is one of the clearest weak spots of Panama property.

ACOBIR's broker MLS gives a rare look at real sales. In the first half of 2026, apartments sold for 6% less than their last asking price on average, after 224 days on the market. The MLS covers only a slice of the market, and asking prices online are easy to find while real sale prices aren't.

The total value of home sales fell 13% to $695 million in the first half of 2026 (ACOBIR/INDESA), and there's plenty of new stock competing with resales.

Selling costs money. The seller normally pays the 2% transfer tax (ITBI) on the higher of the price or the updated cadastral value, plus a 3% advance on capital-gains tax (or 10% of the real gain if that's less). Agency commission is 3%–5% plus 7% ITBMS.

So short holding periods don't work. An apartment bought for ten years of rent can do well; one bought to flip in two years needs a lot of luck.

Exit cost or issue	Typical effect
Transfer tax (ITBI)	2%, normally paid by the seller
Capital-gains advance	3% of the sale price (or 10% of the real gain if lower)
Agency commission	3%–5% plus 7% ITBMS
Discount from last asking price	6% on average (ACOBIR, H1 2026)
Time to sell an apartment	224 days on average (ACOBIR, H1 2026)

Should a Panama rental investor expect property prices to rise quickly?

No. Buy for the rent and treat any price gain as a bonus.

Panama has a lot going for it: the dollar, the Canal, Tocumen's air hub, logistics, banking and growing tourism.

But prices have been slow. ACOBIR's closed apartment prices in Panama City were $1,726 per m² in the first half of 2026, 1.7% below a year earlier and only 6.2% above 2021. After inflation, that's roughly flat over five years, and the last year's 1.7% dip is about 4.4% in real terms with inflation at 2.8%.

With 15,499 unsold new units in the capital and growth forecast at 4.2% for 2026, we wouldn't build a deal on 8% or 10% price growth a year.

If an apartment only works because its price has to rise fast, it's already too fragile.

What changed in 2026 for someone buying a Panama rental?

Four things, and none of them changes the basic math: buy for cash flow.

Law 546, in force since September 1, 2026. The first sale of a new home pays no transfer tax on the first $120,000, whatever the price, so it saves $2,400 on any new unit. Above $120,000, the rest pays a reduced rate up to $200,000 and the normal 2% above that. The seller normally pays this tax, so ask for the saving in the price.

The Qualified Investor visa, under Decree 17 of 2026, in force since September 16, 2026. Property from $300,000 for a first sale of a new home, or $500,000 for a resale, can get you permanent residency. The money has to stay invested for 5 years and any mortgage is deducted, so you can't finance the threshold. A rental bought for income rarely needs to be that expensive, so don't stretch your budget just for the visa.

The Airbnb bills. Bills 301 and 713 would replace or reform the 45-day rule, with 10% or 15% ITBMS. Nothing passed between October 20 and 28, 2026. Don't buy on the hope that one passes.

The EU list. Panama left the EU's tax blacklist on October 9, 2026 but stays on the watch list (Annex II). It's a small plus for banks and money transfers, not a reason to pay more.

What to do now: ask unsold towers for 5% to 10% off, check the PH rules on renting in writing, price your rent from signed leases, and run your yield after income tax.

What kind of Panama rental is still worth buying?

A small, well-run apartment in a central Panama City area, paid in cash and priced at 8% gross or better on signed rents.

Panama City still gives 7% to 8.7% gross, with the best areas around 8% to 9% on asking data: Punta Paitilla, Coco del Mar, San Francisco, Obarrio and El Cangrejo.

The catch is what's left. On our example, 8.74% gross becomes 4.78% after costs and a 15% tax if you manage it yourself, or 3.79% with a manager. A 9% mortgage turns that into a loss, and selling can cost up to 5% of the price in taxes before the agent.

We'd want a unit that starts at 8% gross or better, has a PH fee under $2.50 per m² and leaves about 5% before income tax. That rules out many expensive new towers and most financed purchases.

For a cash buyer holding for years, Panama is one of the better dollar rental markets in Latin America. For a quick flip, a generic Airbnb plan or a purchase made mostly with borrowed money, the numbers don't work.