Purchasing real estate in Panama can be a profitable, satisfying experience. The country is far more advanced than Costa Rica, but real estate prices (in general) are far lower. Foreigners have the same property rights as Panamanian citizens, and if you purchase your real estate through a corporation (very easy to set up) you will be exempt from property taxes for 20 years.

However, you need to be very careful when buying property in Panama through a real estate agent. Fraud is rampant throughout Panama, and little is being done to stop it. In 1999 the Real Estate Technical Board (Junta Technica de Bienes Raices) of the Republic of Panama was formed. Supposedly this government agency has the power to consider complaints arising from any real estate transaction, and to impose any sanctions that are deemed necessary. This includes anything from a reprimand up to a revocation of an agent’s license, so they can no longer sell real estate in Panama. This all looks good on paper, but in fact the Board has proven to be almost completely impotent in stopping real estate fraud in Panama.

Case in point: My first real estate purchase in Panama was done through a company called Great Land Panama. The owner of the company, Khadine Smith, defrauded me out of thousands of dollars when she charged a 30% commission. She then turned around and stole $20,000 from the landowner, by not paying him the price that was in his contract.

I had to talk with five attorneys before I could even find one who knew how to file a formal complaint with the Real Estate Board. The complaint was filed in May of ’08, after which I heard nothing for more than six months. Finally in Dec ’08 I was able to get in touch with a senior official on the Board. He informed me that this particular agent had four other complaints against her, involving millions of dollars. The Board had not yet investigated any of these complaints, but he assured me that they would “get around to it very soon.” Bottom line – she is still out there ripping off unsuspecting foreigners, and will probably continue doing so for the foreseeable future.

So what is one to do? It’s fairly simple; make sure that you either work directly with the landowner or with a foreigner who is already developing a project, with no intermediaries. I personally know several “gringos” in my area of the Azuero Peninsula who are working on various projects, and none of them used an agent for their real estate in Panama. If you don’t speak Spanish I can help you with translation services, as well as guiding you through the entire process of purchasing real estate in Panama. Feel free to contact me, I would be happy to help you in any way I can.

When you think about living full or part time in Central America, Costa Rica seems to be the first country that comes to mind. Having spent a fair amount of time in both Costa Rica and Panama, I may be able to offer a somewhat unique perspective when comparing the two countries. While both countries are similar in many respects, there are some major differences between Panama real estate versus Costa Rica real estate that you should be aware of.

First of all, there are many similarities. Both Panama and Costa Rica have mountains, oceans, beaches, volcanoes, tropical rain forests, zip line tours, hot springs and exotic wildlife. Both countries have more residents who speak English in the bigger cities, while very little English is spoken in the more remote areas. Both countries have similar temperate climates, and both are quite beautiful. I honestly can’t think of a single good thing about Costa Rica that you can’t also find in Panama.

The differences between the two countries are significant. Lets begin with the Panama roads that are well maintained in comparison to the terrible pot hole roads in Costa Rica. Not only that the cost of living in Panama is much more inexpensive than in Costa Rica because of the Panama canal and its huge port advantages. When thinking of visiting or living in Panama, the currency exchange rate is less of a frustration. Even traveling into the capital cities are a different experience from one another. You can feel much safer with lower crime rates in Panama than in Costa Rica. Finally, the ultimate winner, purchasing real estate in Panama is at a fraction of the cost of what it would be for the same piece of land in Costa Rica.

Panama Real Estate:

Let’s save the best for last; you can purchase land in Panama for a fraction of what it would cost you in Costa Rica. The same large six acre lots with ocean views and riverfront that I’m selling in Panama for around $150,000 would cost at least $500,000 in Costa Rica. Land in Costa Rica is roughly five times more expensive than comparable land in Panama. There are expensive areas in Panama, like Boquete, Anton and Panama City, but for the most part real estate is extremely affordable throughout the country.

Another big difference between the countries involves squatters. In Costa Rica if you buy land and squatters move onto it, in three months they actually have rights to your property, and protracted legal action is required to get rid of them. Incredible, but true. In Panama squatters have no legal rights whatsoever. If you buy land in Panama leave it alone for ten years, and upon your return people are living on it, you can have them removed immediately.