Investing in Real Estate in Panama: Residency and Rentals

Which residency options accept property?

• Qualified Investor: permanent residency with a real estate investment of at least USD 300,000.
• Economic solvency: property in your name, a fixed-term deposit or a combination of both, for at least USD 300,000.
• Pensionado Visa: with a home worth USD 100,000 or more, the minimum pension required is lower.
• Friendly Nations Visa: for nationals on the list, a real estate investment of at least USD 200,000 serves as the economic tie.

Each program sets which properties it accepts, how the source of funds is proven and how long the investment must be held. Structure the purchase with residency in mind from the start. The steps of the purchase and the difference between title and possessory rights are in buying property in Panama as a foreigner.

How is rental income taxed?

A property located in Panama generates Panamanian-source income: what you receive from renting it is subject to income tax in Panama, even if you live abroad or are paid into a foreign account. The property also pays annual property tax, and your country of residence may also tax that income under its law and any applicable treaties (see territorial taxation).

Can I rent it to tourists?

Short-term rentals, for example through platforms such as Airbnb, have their own rules, different from residential rentals:

• The building's or condominium's bylaws (propiedad horizontal) may restrict or prohibit them: ask for them before buying.
• They may require registration with the Panama Tourism Authority and be taxed as a lodging activity.
• Their income is taxed in Panama, just like residential rental income.