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SUMMARY
Yes. The property market in Panama is still growing, but the growth is concentrated in Panama City, rentals and higher-value property rather than spreading evenly across the whole country.
The strongest proof is not one headline statistic. Sales have rebounded from a very weak 2025, asking prices are rising in several Panama City districts, rents are up sharply, and available inventory has tightened at the same time.
The recovery is much stronger in premium urban property than in affordable housing. Buyers in Santa María, Costa del Este, Punta Pacífica and other higher-value districts depend less on subsidized mortgages, while households below B/.120,000 are still struggling with credit and affordability.
That split explains the strange combination of rising property prices and falling mortgage issuance. New mortgage lending was still down almost 20% through May 2026 even while rents and several price measures were moving higher.
Supply is also helping prices. Construction activity and construction credit have fallen, developer condominium inventory is at a reported nine-year low, and resale listings have dropped sharply in several important Panama City neighborhoods.
Rents are one of the clearest signs that demand is real. Apartment asking rents in Panama City were up about 13.5% year over year in the latest Encuentra24 data, although purchase prices have also risen enough to keep gross yields from expanding much.
Panama City is doing most of the heavy lifting. Some neighborhoods are posting high-single-digit or double-digit asking-price growth, while other parts of the country remain far more dependent on local wages, mortgage approvals and mass-market affordability.
The luxury end looks healthier than ordinary housing. Scarcity, foreign demand, dollar-based pricing and buyers with more cash are supporting premium apartments and waterfront property even while lower-priced mortgage segments remain weak.
Tourism and the broader economy are adding another layer of demand. GDP growth accelerated, international visitor arrivals jumped in the first half of 2026, and that supports rentals, furnished apartments and internationally oriented property more than ordinary suburban housing.
The main thing stopping us from calling this a national boom is credit. If mortgage approvals start rising while sales, rents and inventory remain strong, the recovery will broaden; for now, Panama has a growing property market with a weak lower end.
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Is Panama’s property market still growing right now?
Yes. Panama’s property market is growing again today, but most of that growth is concentrated in Panama City, rentals and higher-value property rather than spreading evenly across every type of home.
The rebound is visible in several different datasets. A 4S Real Estate study reported by La Prensa counted 2,866 new-home sales in 2025, down almost 40% from 4,737 in 2024. Then 1,292 homes were sold in the first quarter of 2026 alone. We should be careful about annualizing one quarter, but that pace is strong enough to show that buyers have returned after a very poor year.
Prices have also moved higher. The Latin American Real Estate Survey produced by Universidad Torcuato Di Tella and Zonaprop put the average Panama City asking price at $1,881 per square meter in September 2025, 6.81% higher than a year earlier. More recent listing data compiled by Global Property Guide from Encuentra24 show several large Panama City districts continuing to rise.
Rents give us another piece of the picture. Encuentra24 listings showed average Panama City apartment rent reaching about $14.70 per square meter in June 2026, up 13.5% year over year. Rising prices alongside double-digit rental growth are much harder to dismiss as a temporary sales bounce.
The weak spot is still credit. New mortgage lending has fallen even as property activity improves. So for now, Panama looks like a market that has restarted and is appreciating in important areas, without yet becoming a broad housing boom.
| Indicator | Earlier level | Latest reading | Change | What it shows |
|---|---|---|---|---|
| New-home sales | 4,737 in 2024 | 2,866 in 2025 | -39.5% | 2025 was extremely weak |
| Q1 new-home sales | — | 1,292 in 2026 | Strong rebound | Buyers have returned |
| Panama City asking prices | — | $1,881/m² | +6.81% YoY | Prices have moved higher |
| Apartment asking rent | — | $14.70/m² | +13.5% YoY | Rental demand is strong |
| New mortgage lending | $722.7M | $578.5M, Jan-May | -19.9% | Credit still lags the recovery |
Why did Panama home sales fall so badly before recovering?
Panama home sales fell sharply because mortgage rules, housing incentives and buyer confidence all became messy at the same time, and the early recovery suggests that at least part of the slump was temporary.
Convivienda reported 6,126 housing sales in 2024, already 25% fewer than a year earlier, with 4,336 units sitting in accumulated inventory. The separate 4S Real Estate dataset then showed its monitored new-home market falling from 4,737 units in 2024 to 2,866 in 2025.
Several policy changes landed during that downturn. The $10,000 Fondo Solidario housing subsidy ended, while uncertainty surrounded the replacement of Panama’s preferential mortgage-interest system. Buyers who depended on subsidized financing had good reasons to delay purchases, and developers had less clarity about what their customers could actually finance.
That helps explain why the rebound has been so fast once the regulatory picture improved. The 1,292 sales recorded in the first quarter of 2026 equal about 45% of the entire 2025 total in only three months.
We therefore see 2025 as an unusually disrupted year rather than a clean measure of underlying housing demand. The recovery is real, although comparing today with such a weak base naturally makes the growth rate look more dramatic.
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Are property prices in Panama actually going up?
Yes. Property prices in Panama City are currently rising in enough neighborhoods, and in enough different datasets, to call the appreciation real.
The citywide benchmark is already positive. Universidad Torcuato Di Tella and Zonaprop measured average Panama City asking prices at $1,881 per square meter in September 2025, 6.81% above the previous year.
More recent Encuentra24 data show a wide spread between neighborhoods. Ancón apartment asking prices were up 18.5% year over year, Bella Vista 12.0%, San Francisco 9.1% and Juan Díaz 9.1%. Betania was almost flat at +1.6%, while San Felipe/Casco Viejo fell 5.1%.
Completed sales tell a less tidy story, which is useful. MLS data included in the 4S Real Estate study put the average secondary-market closing price across Panama City at roughly $1,726 per square meter in the first half of 2026. Juan Díaz rose from $2,110 per square meter in 2025 to $2,587, while Bella Vista fell from $1,687 to $1,405.
New developments are also pulling averages upward because they are much more expensive than existing stock. Panama Equity estimated early-2026 resale versus preconstruction prices at roughly $2,500 versus $3,800 per square meter in Costa del Este, $2,200 versus $4,300 in Punta Pacífica and $1,900 versus $3,500 in San Francisco.
We would not assume that every owner in Panama City has suddenly gained 10% or 15%. Still, when citywide asking prices, rents and selected resale closings are all moving higher, the broader direction is difficult to argue with.
| Panama City area | Apartment asking price | YoY change | What we see |
|---|---|---|---|
| Ancón | $2,422/m² | +18.5% | Strong appreciation |
| Bella Vista | $2,353/m² | +12.0% | Listings strong, resales weaker |
| San Francisco | $2,329/m² | +9.1% | Clearly positive |
| Juan Díaz | $2,846/m² | +9.1% | Supported by higher closing prices |
| Betania | $1,724/m² | +1.6% | Mostly flat |
| San Felipe / Casco Viejo | $3,998/m² | -5.1% | Premium prices, recent correction |
Is Panama City where most of the property growth is happening?
Yes. Panama City is driving much of Panama’s property growth today, especially in modern apartment districts where higher rents, international demand and limited supply are meeting each other.
The price differences across the country are simply too large to talk about Panama as one market. According to the 4S Real Estate study, primary-market apartment prices ranged from about $2,045 per square meter in Pedregal to $4,626 in Santa Ana/Casco Antiguo. Bella Vista was around $3,782, Juan Díaz around $3,723 and San Francisco around $3,673. Horizontal housing markets were generally much closer to $850-$1,200 per square meter.
Juan Díaz currently has one of the clearest combinations of positive data. Asking prices increased roughly 9.1% year over year, secondary-market closings rose from about $2,110 per square meter in 2025 to $2,587 in the first half of 2026, and MLS rental data put average apartment rent at $14.17 per square meter.
Costa del Este benefits from a different mix: large modern apartments, multinational companies, foreign families and a deep rental market. Santa María is smaller and more expensive, with pricing supported by scarcity and wealthy buyers.
Outside those stronger Panama City niches, the story gets much more mixed. A family buying a $100,000 house in Panama Oeste depends far more heavily on local income and bank financing than someone buying a $700,000 apartment in Santa María.
That gap between buyers explains a lot of the confusion around Panama’s property market today.
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Are rents still rising in Panama City?
Yes. Panama City rents are rising quickly these days, and rental growth is now one of the strongest pieces of evidence behind the wider property recovery.
Global Property Guide’s analysis of Encuentra24 listings showed average apartment asking rent reaching about $14.70 per square meter in June 2026, 13.5% above a year earlier. House rents increased 13.2% to around $9.12 per square meter.
A different MLS dataset used by 4S Real Estate also found rents at their highest level in several years during the first half of 2026. Its citywide apartment average was approximately $12.57 per square meter, with Juan Díaz at $14.17, San Francisco at $12.73 and Bella Vista at $12.18.
The exact level varies because the two sources use different listing and transaction pools, but both show the same direction: rents have gone up materially.
Global Property Guide estimated average gross residential rental yields at 7.57% in Panama City in April 2026, compared with 7.83% a year earlier. Nationwide yields averaged 6.94%, slightly above 6.84% in April 2025. Prices therefore appear to have risen fast enough that yields have not expanded much despite higher rents.
For investors, that is the catch. Rental income is growing, but buyers are also paying more for the asset.
Is luxury real estate growing faster than ordinary housing in Panama?
Yes. Luxury and upper-end Panama property is currently much healthier than affordable housing, helped by cash buyers, foreigners and wealthier households that depend less on subsidized mortgages.
Registry-based analysis by Panacomps found recent Ocean House transactions in Santa María averaging roughly $3,622 per square meter through early 2026. That was about 11.3% above the building’s long-run average across 172 verified sales. At Ocean Reef, waterfront properties were testing roughly $6,000-$8,000 per square meter.
Foreign demand fits naturally into this part of the market. Panama uses the US dollar, foreigners can generally buy titled property on essentially the same basis as locals, and the country remains easy to reach from North and South America. Certain property investments can also be used within residency programs.
There is no reliable national dataset telling us what percentage of all homes are currently bought by foreigners, so we would avoid pretending to know that figure. What we can see is where international buyers tend to concentrate: Costa del Este, Punta Pacífica, Santa María, Avenida Balboa and Casco Viejo overlap heavily with the neighborhoods showing the highest prices and some of the tightest supply.
Meanwhile, mortgages for homes up to $80,000 fell 35.3% during the first four months of 2026, while lending in the $80,001-$120,000 range dropped 27.5%.
The contrast is sharp. Panama’s wealthier property buyers are currently pushing ahead while many ordinary households are still struggling to finance a purchase.
| Panama property segment | What is happening now | Main buyer issue | Direction |
|---|---|---|---|
| Luxury Panama City | High prices, scarce inventory | Finding the right asset | Strong |
| Premium waterfront | $6,000-$8,000/m² in some projects | Very limited supply | Strong but niche |
| Upper-middle apartments | Better sales and rents | Value versus new-build premiums | Growing |
| Homes below $120k | Weak mortgage approvals | Affordability and credit | Weak |
| Peripheral family housing | More price-sensitive demand | Household income | Mixed |
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Why are Panama mortgages falling while property prices rise?
Panama mortgage lending is still falling because the strongest property buyers today are less dependent on bank credit than the families struggling at the affordable end of the market.
Between January and May 2026, banks issued $578.5 million in new mortgages, down from $722.7 million during the same period a year earlier. That is a 19.9% fall even as several property-price and rental measures move higher.
The split becomes clearer when we look at subsidized housing finance. Preferential residential mortgage lending totaled $132 million in the first four months of 2026, compared with $200 million one year earlier. Regular residential mortgage issuance fell much less, from roughly $270 million to $249 million.
Borrowing also costs more than it did a few years ago. Panama’s domestic residential reference rate had risen from 5.75% during 2020-2022 to 6.50% by late 2025. The Superintendency of Banks kept the relevant benchmark at 6.50% in its second-quarter 2026 circular.
That increase hurts most where monthly affordability is already tight. Panama also entered 2026 with unemployment at 10.4% and informal employment around 47.1%, which makes mortgage approval harder for a large share of households.
We can therefore have stronger apartment prices and weaker mortgage lending at the same time. The people pushing up premium urban prices are simply not representative of every potential homebuyer in Panama.
Is Panama’s new preferential mortgage system working yet?
Not fully. Panama’s new preferential mortgage framework has removed some of the uncertainty that hurt housing sales, but the latest lending numbers show that cheaper mortgage access has not recovered yet.
The revised system covers qualifying homes worth up to B/.120,000 and gives the market a more stable framework than the stop-start rules buyers and developers dealt with previously.
That legal clarity is useful because homes below B/.120,000 make up a huge part of Panama’s mass market. CAPAC again said during Expo Vivienda 2026 that demand was heavily concentrated below that level, with more than 300 projects presented at the event.
Still, actual preferential mortgage issuance was down 34% during the first four months of 2026. The implementing regulation was only completed in June, so the first few months of the year were never a clean test of the new regime.
For now, we would call the law a potential recovery driver rather than evidence that affordable housing has already recovered. The next useful test is simple: banks need to start approving more of these mortgages.
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Is Panama building enough new homes, or is supply getting tight?
Panama is currently building less while available apartment supply is shrinking in several important Panama City districts, which helps explain why prices can rise even without a construction boom.
INEC recorded 377,967 square meters of construction across Colón, Panamá, San Miguelito, Arraiján and La Chorrera in the fourth quarter of 2025. That was 16.2% below the 451,206 square meters recorded one year earlier. Activity fell especially hard in Arraiján and San Miguelito.
Bank financing points the same way. New construction lending totaled $631.5 million during the first five months of 2026, down 24.4% year over year. Developers therefore have less fresh credit available to launch and complete projects.
At the same time, Panama Equity counted 16,311 developer condominium units across presales, projects under construction and completed inventory in early 2026, its lowest reading in nine years.
Resale listings also fell heavily across the brokerage’s tracked neighborhoods: roughly 30% on Avenida Balboa, 40% in Costa del Este, 43% in El Cangrejo and more than 50% in Santa María and Casco Viejo.
As pointed out above, shrinking supply has become an important part of the Panama City price story. The current market can keep getting more expensive even if developers are not building dramatically more homes.
| Supply indicator | Previous level | Latest level | Change | What it means |
|---|---|---|---|---|
| Q4 construction area | 451,206 m² | 377,967 m² | -16.2% | Less construction |
| New construction credit | About $835M | $631.5M | -24.4% | Harder project financing |
| Developer condo inventory | Higher historically | 16,311 units | 9-year low reported | Pipeline is shrinking |
| Costa del Este resale inventory | — | -40.2% YoY | Sharp fall | Buyers have less choice |
| Santa María resale inventory | — | -52.4% YoY | Very sharp fall | Scarcity supports pricing |
Is Panama’s economy strong enough to keep property growing?
Yes. Panama’s economy is growing fast enough to support more real-estate demand, although many local households are still not feeling enough of that growth to comfortably buy a home.
Panama’s real GDP grew 4.4% in 2025 after 2.9% in 2024, according to INEC. Growth then reached 4.8% year over year in the first quarter of 2026. The monthly economic activity index was running much faster by mid-2026.
For property, stronger activity supports company hiring, relocations, logistics, retail spending, business formation and demand for rental housing. Panama also continues to benefit from the Canal, banking, regional headquarters and Tocumen’s role as a major aviation hub.
The labor market is less impressive. Unemployment reached 10.4% in 2025 and almost half of employment remained informal.
That gap goes a long way toward explaining the property market these days. Economic growth is strong enough to fill apartments and attract higher-income buyers, while many households still cannot turn their housing needs into a mortgage approval.
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Is tourism becoming a real driver of Panama property demand?
Yes, especially for rentals and internationally oriented property. Panama tourism is growing quickly enough now to have a noticeable effect on the parts of the real-estate market exposed to visitors and foreign buyers.
The Panama Tourism Authority reported 1,755,998 international visitors during the first half of 2026, up 17.4% from the same period a year earlier. Tourism income reached roughly $3.79 billion, increasing 14.7%.
Panama Stopover adds another useful clue. More than 132,000 travelers used Copa Airlines’ stopover program during the first half of 2026, 38% more than a year earlier. These are people who could have stayed inside Tocumen Airport but instead spent time in Panama.
Event tourism is also becoming larger. The Tourism Authority reported 74 international events during the first half of 2026, involving more than 113,000 participants and almost 48,000 occupied hotel rooms.
Those visitors primarily help hotels, but some of the demand spills into furnished apartments, short-term accommodation and second homes. The impact is strongest in Panama City and leisure destinations rather than ordinary suburban housing.
Tourism therefore gives Panama’s upper-end and rental markets another source of demand at a time when domestic mortgage demand is still weak.
Which part of Panama’s property market is struggling most?
Affordable, mortgage-dependent housing is still the clearest weak spot in Panama’s property market today.
The numbers are unusually direct. Loans for properties worth up to $80,000 fell from more than $97 million during the first four months of 2025 to $62.5 million in the same period of 2026, a 35.3% decline.
In the $80,001-$120,000 range, approvals dropped from $92.9 million to $67.4 million, down 27.5%. Financing between $120,000 and $150,000 fell even more sharply, although changes to preferential-loan categories make that segment harder to compare cleanly.
These are important price brackets because local demand is concentrated there. CAPAC’s Expo Vivienda again showed that buyers want homes below B/.120,000.
Panama does not have a lack-of-interest problem at the affordable end. Plenty of families want housing. The difficult part is getting the monthly payment, household income and bank approval to line up.
That weakness is one reason we would be skeptical of anyone describing Panama as being in a nationwide property boom.
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Could Panama’s property recovery lose momentum again?
Yes. Panama’s property recovery can keep going, but weak credit and stretched affordability could still stop the rebound from spreading beyond the strongest neighborhoods.
Mortgage lending is the biggest risk. If banks keep approving fewer home loans while prices climb, more local buyers will simply be priced out.
The second risk is employment. A 10.4% unemployment rate and very high informality make it difficult for mass-market housing to grow at the same pace as Panama’s economy.
There is also a price risk in new developments. Preconstruction apartments in several Panama City districts now cost far more per square meter than comparable resales. Buyers will eventually push back if that premium gets too large.
At the higher end, however, the market has more room. Scarce inventory, stronger rents, foreign demand and buyers with less dependence on mortgages give premium property a better cushion.
We are therefore more confident that prime Panama City property can keep growing than we are about the national housing market as a whole.
So, is the property market in Panama still growing?
Yes. Panama’s property market is still growing, and the latest evidence makes that answer stronger than it was a year ago, but the growth remains heavily concentrated in Panama City, rentals and higher-value property.
The turnaround in sales is difficult to ignore. After new-home sales in the 4S Real Estate dataset fell almost 40% in 2025, 1,292 homes were already sold in the first quarter of 2026. Panama City asking prices have risen, several districts are posting high-single-digit or double-digit annual increases, and apartment rents were up around 13.5% year over year in the latest Encuentra24 data.
Panama’s broader backdrop has also improved. GDP grew 4.8% year over year in the first quarter of 2026, while international visitor arrivals jumped 17.4% in the first half of the year. Those are useful sources of fresh demand for rentals and urban property.
The biggest reason we stop short of calling this a boom is credit. As we saw previously, new mortgage lending was still down almost 20% through May, while affordable preferential mortgages had fallen even faster. Construction activity has also remained weak.
Our judgment is that the claim is mostly true.
Panama has moved beyond the 2025 slump and entered a genuine property recovery. In parts of Panama City, particularly where rental demand and limited supply overlap, that recovery already looks like real growth. Affordable housing has not caught up yet.
If mortgage approvals begin rising while sales and rents remain strong, the debate will become much simpler. For now, Panama has a growing property market with a weak lower end, rather than one broad boom carrying every buyer and every neighborhood with it.
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OUR METHODOLOGY
This analysis tests whether Panama’s property market is still growing by looking at the parts of the market that can move in different directions at the same time: sales, asking prices, completed transactions, rents, mortgage lending, construction, inventory, buyer segments and the wider economic backdrop.
We did not treat one positive quarter or one neighborhood as enough proof. The 2026 sales rebound is used as evidence that activity has returned after an unusually weak 2025, while price, rent, credit and supply data are used to judge whether that rebound is broad, durable or concentrated.
Listing data from Encuentra24 and market reports are used to read current asking-price and rental pressure. Completed MLS and registered transactions are kept separate because they show where deals actually cleared rather than where sellers hoped to sell.
Credit is treated as a separate test of market breadth. Mortgage statistics from the Superintendencia de Bancos de Panamá help show whether local households can finance purchases, while construction credit helps explain whether developers are adding enough new supply.
We also separate Panama City from the broader national market where the evidence justifies it, and we distinguish premium and internationally oriented property from mortgage-dependent affordable housing. That segmentation is central to the conclusion because those groups are currently behaving very differently.
Supply conditions are assessed using official construction data, developer inventory and neighborhood resale inventory. We give more weight to price increases when they appear alongside falling availability, because that helps distinguish stronger demand from a temporary sales bounce.
The broader demand backdrop comes from official GDP, employment and tourism data. These figures are not treated as direct property-price measures, but they help explain why rentals, internationally oriented apartments and upper-end Panama City property can strengthen even while mass-market mortgage demand remains weak.
Key sources used for this analysis include: La Prensa on the 4S Real Estate new-home sales study, Universidad Torcuato Di Tella on Panama City asking prices, Panama Equity’s Q1 2026 market report, Panama Equity’s later 2026 market update, Panacomps on the luxury residential market, Convivienda on 2024 housing-market results, CAPAC on affordable-housing demand, INEC on construction activity, INEC on GDP, the Superintendencia de Bancos de Panamá on mortgage and construction credit, the Official Gazette on the preferential-mortgage framework, the Autoridad de Turismo de Panamá on first-half 2026 tourism, and MICI on Qualified Investor activity.
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