Buy or Rent in Panamá? The Big Question for Expats!

Moving to Panamá is a dream for many—the breeze, the laid-back lifestyle, the sound of the waves… But when it comes time to decide where to live, a question arises that divides the expat community: should you buy or rent?

The advice I’ve heard most often in recent years from other expats is: rent before you buy. I’ve seen this recommendation work perfectly in many cases, since it’s risky to invest in a country you don’t yet know—and even riskier to do so without accurate information about how the real estate market works in Panama. lets explore both sides benefits and risks from my point of view:

While Buying gives you stability, and a Sense of Belonging Those who choose to buy a property often do so for several reasons:

-Long-term investment: Property can appreciate in value, especially in growing areas, this if youre willing to wait And the overall increase in value happens when the owner is willing to make some improvements.

-Avoid rising rents: Having a paid-off home—brings peace of mind, Considering that the Panamanian law allows for an annual rent increase of no more than 10%.

– Income potential: Many expats rent out their homes or condos where you can expect a ROI of 5-7%.

-Sense of belonging: “It’s my home, my space. Personally, I love seeing how our new neighbors start getting involved in the community—and how, when they return to their houses or apartments, they truly feel like they’ve come home!

-Permanent Residency: Nowadays, it’s a reality that obtaining permanent residency in Panama is much easier through a real estate investment, which is why many expats choose to buy.

But it’s important to keep in mind: buying comes with maintenance costs, taxes, and often complex legal processes for foreigners. It’s also important to keep in mind that the real estate market in Panama operates very differently from that of other countries, where properties may rent or sell much more quickly. However, it’s always possible to make a smart investment—as long as you have the numbers in hand and, most importantly, avoid buying without first hearing several opinions and recommendations from people who have lived here much longer.

Renting: Flexibility, Lower Commitment, and Room to Explore
On the other hand, those who rent have equally valid reasons and me personally, recommend this option a LOT, here is why:
– Initial investment: You don’t need a large amount of money to get started. only deposit which is equal to one month of rent, and the first month.

-More freedom: You can move to a different area if your needs or preferences change. I personally encourage everyone I know to explore different communities, listen to the experiences of other families, and step away from their computers to see for themselves what each place has to offer.

-Great for newcomers: Renting lets you explore before making a long-term commitment and It also allows you to start building your social life in this new country, to meet people, try new activities, get used to a new routine, and create a new lifestyle.

Some see renting as a smart strategy to observe the market before making a purchase decision. what about you?