Is Airbnb still worth it in Panama City?

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Is Airbnb actually legal in Panama City right now?

For a normal residential apartment in Panama City, running nightly Airbnb stays is currently a risky proposition because rentals under 45 days remain prohibited unless the property has the required tourist-accommodation authorization.

Article 21 of Panama’s Law 80 of 2012 prohibits rentals shorter than 45 days in the District of Panama when the operator does not have permission to provide public tourist accommodation. Fines can range from B/.5,000 to B/.50,000, and the law also covers electronic advertising of unauthorized stays.

That rule is still being enforced. A Panama Tourism Authority resolution published recently in the Official Gazette dealt with an apartment in PH Yacht Club after a complaint from the building’s owners’ association. The case referred directly to an Airbnb advertisement and evidence of repeated short stays.

So we cannot start an Airbnb investment model by taking a Panama City condo, plugging in a nightly rate and multiplying it by occupancy. The first thing we need to know is whether that exact property can legally accept short stays.

Why are there thousands of Panama City Airbnbs if short stays are restricted?

Panama City still has a large Airbnb market, but the number of live listings tells us much more about traveler demand than about whether a new investor can legally copy those listings.

AirDNA currently tracks 3,789 active short-term-rental listings across Panama Province. Airbtics also recorded hundreds of new Panama City listings during 2025. Clearly, people are finding ways to rent homes and apartments to short-stay guests.

Those listings do not all sit in the same legal category. Some properties can qualify as tourist accommodation, some hosts target stays of 45 days or more, and others may simply be operating despite the restriction. Airbnb itself contains Panama City properties with explicit 45-day minimum stays.

This is why counting Airbnb listings can give a false sense of safety. A building full of active listings does not replace a review of its legal authorization and PH rules.

Is Panama about to legalize Airbnb in Panama City?

Panama is moving toward a clearer legal framework for short-term rentals, but we still cannot buy a condo today as though broad legalization had already happened.

Bill 301 would regulate tourist rentals and create a formal framework for properties offered through platforms such as Airbnb. Panama’s National Assembly had the bill scheduled for second debate earlier this year, which means the proposal has gone much further than an early political idea.

The current restriction has nevertheless remained in force while the bill moves through the legislature. An investment can lose money during the gap between “the law may change” and “the law has actually changed.”

Legalization also has a less obvious downside. If ordinary residential units suddenly gain an easier path into short-term rentals, Panama City could get a large wave of new Airbnb supply. Investors would gain legal certainty while facing more competitors.

Buying solely because Bill 301 might pass looks premature. Buying a property that already works under today’s rules is much easier to defend.

Is Panama City getting enough tourists to keep Airbnbs busy?

Panama City currently has plenty of underlying visitor demand, and the latest tourism figures are stronger than they were a year ago.

Panama’s Tourism Authority counted 3.00 million international visitors in 2025, an 8.2% increase from the previous year. Tourism receipts rose even faster, reaching about $6.58 billion, up 9.7%.

The pace then accelerated. During the latest reported first half of the year, international arrivals were 17.4% higher than in the same period a year earlier, while tourism receipts rose 14.7% to about $3.79 billion.

Tocumen International Airport is especially relevant for Panama City because it handled 2.24 million of Panama’s international visitors in 2025. The capital sits directly beside the country’s main visitor funnel rather than depending on tourists making a separate trip into the city.

Hotels are filling as well. The Tourism Authority’s latest monitoring put hotel occupancy around 59.3%, reinforcing the idea that accommodation demand is genuinely healthy.

Are Panama City Airbnbs actually getting more bookings now?

Yes. Panama’s latest short-term-rental data shows a sharp jump in occupancy, and this is one of the strongest current arguments in Airbnb’s favor.

AirDNA’s latest Panama Province data puts average short-term-rental occupancy at 69%. More importantly, occupancy is up 34.7% compared with the same point a year earlier.

That is a very large move. AirDNA calculates occupancy from booked nights as a share of nights the property was actually available, so the increase cannot simply be explained by hosts blocking their calendars.

RevPAR, which combines occupancy and nightly pricing, has also increased 27.7%. Demand has therefore improved enough to raise revenue earned per available night even though nightly prices themselves have fallen.

AirDNA also gives the market a seasonality score of 96 out of 100, meaning demand is unusually steady across the year. For an urban Airbnb investor, that is attractive because income does not depend on a short high season.

Why is Panama City Airbnb occupancy rising while nightly prices are falling?

Panama City Airbnb demand looks stronger today, but hosts appear to be winning those extra bookings partly by accepting lower nightly prices.

AirDNA currently reports 69% occupancy, up 34.7% year over year, while the average daily rate has fallen 8.3% to $92. That combination is more revealing than occupancy alone.

At the same time, AirDNA counts 26.5% fewer active listings than a year earlier across Panama Province. Less available supply can push occupancy toward the remaining properties even without every host becoming dramatically more competitive.

The result is a market where more available nights are being filled and RevPAR has increased, but pricing power is still weak. Hosts are not using stronger occupancy to push average rates higher.

That should make us cautious with aggressive projections. A new investor assuming both 70% occupancy and rapidly rising nightly rates would be extrapolating something the current data does not show.

How much revenue does a Panama City Airbnb actually make?

A typical short-term rental around Panama City currently generates roughly $20,000 to $21,000 a year before host expenses, which is respectable but far from spectacular.

AirDNA puts trailing annual revenue at $21,400 across Panama Province, with a $92 average daily rate and 69% occupancy. Airbtics’ full-year Panama dataset came to B/.20,712 at an average daily rate around B/.82.

The agreement between two different datasets is useful because their methodologies and geographic coverage differ. Both still land in roughly the same $20,000 range.

Panama City also sits below broader Central American pricing. Airbtics measured the region’s average ADR around $119, compared with roughly $82 in its Panama dataset. Panama compensates through much higher occupancy: about 68% versus 53% across Central America.

That tells us what kind of Airbnb market Panama City has become. It fills units well, but the average guest is not paying a premium resort-level nightly rate.

Does Airbnb make more money than a normal Panama City rental?

For many Panama City apartments, Airbnb no longer has a convincing gross-income advantage over a conventional tenant.

Global Property Guide’s current Panama City data puts the average monthly rent for a studio or one-bedroom apartment around $1,650. That works out to $19,800 a year before landlord expenses.

Compare that with AirDNA’s $21,400 average annual short-term-rental revenue. The difference is only about $1,600 a year, or roughly $133 per month.

Even that comparison slightly flatters Airbnb because the AirDNA figure includes booked nightly rates plus cleaning and other guest fees before host expenses. A long-term tenant usually pays their own electricity and internet and does not require cleaning after every stay.

The exact comparison will change from apartment to apartment, but the order of magnitude is clear. If a $200,000 condo can earn around $1,500 to $1,700 a month from one tenant, Airbnb needs to perform materially better than the city average before the extra work starts looking worthwhile.

Can Airbnb expenses wipe out the extra income in Panama City?

Yes. Once we add management, utilities, cleaning, furniture and PH fees, a normal Panama City Airbnb can easily earn less net income than its headline revenue suggests.

The first expense is management. A fully managed short-term rental commonly gives up a meaningful share of revenue because someone needs to handle messages, pricing, check-ins, guest problems and turnovers.

Electricity and internet usually remain with the owner as well. Air conditioning matters in Panama City, so these are real recurring costs rather than tiny line items.

Furniture takes another bite. A long-term apartment may go years without replacing much beyond basic fixtures, while an Airbnb needs mattresses, linens, kitchenware, televisions and furniture to remain guest-ready.

Then there are PH charges. Panama City has many towers with pools, gyms, security, elevators and large common areas. Those amenities help photographs and bookings, but the owner pays for them every month whether the apartment is occupied or empty.

With average gross short-term-rental revenue around $21,400, there simply is not enough room to ignore these costs. The investment becomes compelling only when the purchase price, building fees and operating setup are unusually efficient.

Which Panama City apartments make the most sense for Airbnb?

Compact apartments in central, practical neighborhoods usually make more financial sense than expensive trophy units when the goal is rental return.

Global Property Guide’s latest Panama City figures show why. A studio or one-bedroom in Bella Vista is priced around $170,000 with roughly $1,350 in monthly rent, producing a measured gross yield of 9.53%. El Cangrejo is around $170,000 and $1,200 per month, for an 8.47% gross yield.

San Francisco also performs well. A studio or one-bedroom is currently around $205,000 with about $1,300 in monthly rent, equivalent to a 7.61% gross yield.

Balboa Avenue comes in around $252,000 with $1,650 monthly rent, producing roughly 7.86%.

Those numbers give Airbnb investors a useful benchmark. A short-term-rental strategy should beat what the same unit could earn with a normal lease by enough to compensate for extra work, costs and legal complexity. Otherwise, there is little reason to choose the harder business.

Are luxury Panama City condos better for Airbnb?

Usually no. Luxury Panama City condos can charge more per night, but the higher purchase price and larger monthly bills often eat most of that advantage.

Consider the gap between a compact $170,000 apartment in Bella Vista and a larger premium unit costing $400,000, $500,000 or more. The expensive apartment may achieve a much higher nightly rate, but it also needs far more annual revenue just to produce the same percentage return on the money invested.

Large luxury towers can also carry substantial PH fees. More elevators, pools, reception areas, gyms and waterfront maintenance make the building attractive to guests while increasing the owner’s fixed costs.

The current long-term market shows the same pattern. Global Property Guide estimates Panama City gross yields around 7.57% overall, but several expensive four-bedroom segments fall close to 6% even before costs.

A beautiful view can absolutely improve an Airbnb listing. We would still rather pay for a unit where guests value the location and usability more than the owner pays for prestige.

Would 45-day furnished rentals work better than normal Airbnb in Panama City?

For many residential condos, 45-day-or-longer furnished rentals currently look like the cleaner way to use Airbnb in Panama City.

The model fits the existing 45-day legal threshold far better than nightly tourism. It can still reach people relocating to Panama, consultants, remote workers, people testing the city before buying property and visitors who need temporary accommodation for several weeks or months.

Longer stays also reduce the operational burden. Instead of cleaning the apartment dozens of times a year, an owner may only need a handful of turnovers. Guest communication falls sharply, and small gaps between bookings become easier to manage.

The trade-off is pricing. A guest staying two months will expect a lower nightly rate than someone staying for a weekend. Yet the owner may keep more of that revenue because operating costs fall.

For an ordinary residential unit that cannot confidently operate short tourist stays, this middle ground makes much more sense today than pretending the 45-day restriction does not exist.

Does the Panama City building matter more than the neighborhood?

Yes. A mediocre apartment in the right building can be a better Airbnb investment than a beautiful apartment in a building that fights short-term guests.

The building determines several things at once. It affects whether tourist use is permitted, whether the PH rules allow frequent guest turnover, how security handles arrivals, how much the owner pays every month and whether the common areas actually help bookings.

The recent PH Yacht Club enforcement case is a good reminder. The complaint came from the building’s own owners’ association, which shows how quickly a rental strategy can become a building-level issue.

This is why we would never buy a Panama City Airbnb based only on a neighborhood average. Before running a revenue model, we would want the PH regulations, the current maintenance fee, any pending special assessments and clear evidence that the intended rental model is allowed.

In Panama City, those documents can change the economics more than moving a few blocks closer to the waterfront.

Could Airbnb legalization make Panama City much more competitive?

Yes. If Panama makes short-term rentals easier to operate legally, the same reform that helps existing owners could bring a lot more apartments onto Airbnb.

We already know owners are interested. Airbtics counted 705 additional Panama City listings during 2025, while its national supply measure increased 36.75%.

The picture has changed lately. AirDNA now reports 3,789 active listings across Panama Province, down 26.5% year over year. That contraction has happened at the same time occupancy jumped 34.7%.

Those two moves fit together. Fewer active listings mean more bookings can be spread across the remaining supply. If legalization later reverses that supply decline, some of today’s occupancy improvement could disappear.

As pointed out above, nightly pricing has already weakened 8.3% even with fewer active listings. That makes the competitive risk especially relevant. A flood of newly legal units could put even more pressure on rates.

Legalization would certainly make the business easier to defend legally. We should not assume it would make every Airbnb owner richer.

Is Airbnb still worth it in Panama City?

Mostly no for someone buying a normal residential condo specifically to run nightly Airbnb stays; currently, the numbers make much more sense for legally authorized properties, unusually cheap units, or furnished rentals of 45 days and longer.

Panama City Airbnb demand is clearly alive. Tourism is growing, AirDNA occupancy has climbed to 69%, and RevPAR is up 27.7%. Those are strong current numbers.

The weakness shows up when we ask what each booking is worth. Average daily rates have fallen 8.3% to $92. Average annual short-term-rental revenue is around $21,400, while a conventional apartment renting for $1,650 a month already produces $19,800 in gross annual rent.

That roughly $1,600 gross gap is too small to ignore Airbnb’s extra costs. Short stays bring utilities, furniture, cleaning, management and heavier wear. They also bring a legal problem for ordinary sub-45-day residential rentals that a standard tenant does not create.

There are still good Airbnb investments in Panama City. A legally suitable unit bought cheaply, with low PH fees and proven short-stay demand, can work very well. A 45-day furnished rental can also capture part of the Airbnb market without relying on constant nightly turnover.

For the average buyer, though, Panama City Airbnb has become a selective strategy rather than an obvious one. We would buy the apartment only if the deal already works as a conventional or medium-term rental. Any short-stay upside should come on top of that, rather than being the assumption that makes the purchase price work.

Fact-checked and reviewed by our local expert

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Shai Bar-Ziv

Founder, Panavanti

Shai Bar-Ziv is the founder of Panavanti, a boutique real-estate brokerage in Panama City specializing in investment properties: commercial plazas, office buildings, and high-yield residential in Costa del Este, the Banking District, and Casco Viejo. He works directly with foreign investors in English and Spanish, backed by a continuously updated dataset of Panama City listings with zone-level pricing.

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