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Closing Costs and Fees When Buying Property in Panama

Posted by GMI GROUP on September 20, 2026
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BUYER GUIDE

Closing Costs and Fees When Buying Property in Panama

A clear breakdown of what buyers actually pay at closing — taxes, notary and registry fees, and legal costs — so there are no surprises before you sign.

Understanding closing costs up front helps buyers budget accurately and avoid surprises at signing. Panama’s process is more affordable than in many other countries, but fees vary depending on the property, financing, and how the sale is structured.

What Buyers Typically Pay

Buyers generally cover legal fees for their own attorney (commonly around 1% of the purchase price), a title search and due diligence review, and public registry fees to record the new deed. If the property is financed, expect additional bank fees such as an appraisal and loan origination costs. See our Panama real estate investment guide for how these costs factor into overall returns.

Who Pays What: Buyer vs. Seller

In most Panama transactions, the seller pays the transfer tax (2% of the registered or sale value, whichever is higher) and a 3% advance withholding on capital gains, both typically settled through the closing attorney. The buyer’s side covers notary fees, registration, and their own legal representation. These allocations are set by contract and can be negotiated, so always confirm the breakdown in writing before signing a promise-to-purchase agreement.

Budgeting Beyond the Purchase Price

Beyond closing, factor in annual property tax (many primary residences and lower-value properties qualify for exemptions under Panama’s Familia y Vivienda law), HOA or building maintenance fees for condos, and property insurance. Foreign buyers relocating or investing should also budget for currency transfer costs when wiring funds internationally. Our guide to buying as a foreigner covers the ownership rules in more detail.

Tips for a Smooth Closing

Work with a licensed Panamanian attorney independent of the seller to review title and confirm the property is free of liens. Get all cost estimates in writing before signing. An experienced local agent can help coordinate timelines between buyer, seller, and attorneys — contact GMI Real Estate Group for guidance through the process.

Frequently Asked Questions

Who pays closing costs in Panama, the buyer or the seller?

Costs are typically split: the seller usually covers transfer tax and capital gains withholding, while the buyer covers notary, registration, and their own legal fees. The exact split is set by contract.

How much are closing costs typically in Panama?

Buyer-side costs are commonly in the range of 1-3% of the purchase price for legal, notary, and registration fees, though this varies by property and financing.

Do foreigners pay extra taxes when buying property in Panama?

No, foreign buyers pay the same transfer and registration costs as Panamanian buyers. There is no special foreign-buyer tax on purchase.

Have Questions About Buying Costs in Panama?

This article is for general information only and is not legal, tax, or immigration advice. Consult a licensed Panamanian attorney for guidance specific to your situation. Property availability, pricing, and specifications are subject to confirmation.

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