Buying a House in Panama

se vendeOver my life, I have bought and sold more homes than you can count on both hands. I’ve purchased new and watched it being built, I’ve purchased old and stripped it down to studs and rebuilt, I’ve purchased everything in between. That is to say, I am not a novice at home buying.

We have been visiting Boquete for three years and, during almost every visit, we have looked at homes and property. I’ve been watching the real estate websites and know what has been on the market for years, what will continue to stay on the market and how prices have fluctuated. Many times I also know the actual selling price. Since Panama does not have an MLS or accurate property sales records, this is very important.

Another issue is that many people want to get back the money they put into their property. Their problem is that they bought at the top of the market. I would have liked to sell my house in Florida for the “value” it had in 2006. Unfortunately, it’s 2013. I sold at 2013 prices but there are many, many hold-outs in Panama still waiting for 2006 to return. One man actually told me last year that he wanted what he bought his lot for in 2007. It is still for sale. A nearby lot finally sold after dropping their price by nearly 40%.

Without MLS or comparable sales information, prices of property are based on what the owner thinks it is worth. So you can have a crummy house on a crummy street that is listed for an unrealistic price. You will also see houses with an incredibly high price sitting on the market for many years. This is not an actual seller. They are just waiting for some unsuspecting gringo to visit Boquete for 3 days and buy a house based on hype and incorrect information. Unless you’ve been in town a while, you have no idea how long a property has been on the market. If the owners change the price by even $1, the house goes to the top of the listings as if it was new on the market. When their contract expires and they re-list, they also go back to the top.

We have seen numerous properties in the last 3 years. We’ve put in offers on 2 – both unsuccessful. The first was over a year ago. It was about a 1/2 acre lot in Las Estancia. We loved the neighborhood, the view, the climate, everything. We worked out a deal with the owner who was living in Thailand. He even interviewed us on the phone to make sure we would be “good neighbors”. That should have been a huge red flag but his intent was to sell all of the property and be out of Panama for good and never our neighbor. We were actually on the way to the bank to send a wire transfer when the owner decided to jack up the price (again). Apparently this is what he does and is the reason that not a single piece of his property has sold in the three years he has owned it. It was disappointing. His agent recently contacted us again and stated that the seller was now “very interested” in selling. This time we took a pass from all of his aggravation and shenanigans. And his property continues to sit = unsold.

The next offer was just a few weeks ago. It’s a large house that needs a lot of work. Most people would find that too difficult but we actually enjoy it. We planned to take this large, very disjointed house and turn it into a 3 bedroom, 3 bath with a new kitchen and open patio. It was doable. We put in what we thought was a very fair offer considering the amount of work needed to make it a home. We used one of the largest real estate offices in Boquete. The owner of the realty office thought our offer was too low and, I imagine, told the owner to reject it. The owner rejected it.

Fast forward about six weeks. We learned that they are building a skating rink and a strip mall adjacent to the house within the next few months. We also found that the owner of our realty company knew about this and neglected to tell us. His response to when we told him that we knew was, “I guess you’re glad he rejected your offer”. Another thing that Panama does not have is full disclosure. Honesty and ethics would be nice but are not necessarily used in the business world of real estate.

So we have to make a few decisions. Maybe we will rent forever, which is not a bad thing. We could use a different realtor but we have seen unethical practices at other offices as well. We can try to buy directly from owners but that limits our choices. We will probably just wait and just see what happens. Often things happen for a reason and we are in no hurry.

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7 thoughts on “Buying a House in Panama

  1. Cley Estenio Gonzalez Caballero, a local David, Chiriqui, attorney, along with Daniel and Giovanny Polanco RodrĂ­guez, two farm care takers, have been accused of taking advantage of probably stealing property from foreigners, or stealing cows from them, or cloning properties owned by foreigners with the help of Public Registry civil servants. Cley Estenio Gonzalez Caballero and the Polanco Rodriguez apparently were hired by foreigners, who ended up being their victims. As it is usual in Panama, no one has been indicted and no one is in prison. Read the front page headline at respected La Prensa newspaper and a special beware blog. links below:

    • We have had similar situations in Boquete. One house has “sold” 3 times, each time the owner kept the sizable deposits and the place has yet to actually transfer. Another reason why people should rent for a long time. Word of mouth is the best recommendation. As with all communities, there are some criminal elements.

  2. There are a pile of homes for sale in Boquete from foreigners who want to leave due to age, health or any other reason. They all bought too expensive during the boom. Realtors in Boquete are no professionals and they just tell anything for a quick sale and commission.
    Jose Branca, Casa Solutions or Estelas, they are all the same. When I am interested in a house or lot I always asked the agent to make an appointment with the owners at the office and bring the deed/tittle along. Has been refused by the agents. I have a lot of experience building 3 homes in The Caribbean, which was difficult but we have done it. Sold two of them with a very good profit. Buying the land cheap is the most important. The last home we sold with a loss of 25% due to the world crisis. If you want to buy or build a home in Boquete, be sure that when you sell it after 10-15 years you will cover inflation, maintenance and insurance.

    • One of the realtors here told me that owners won’t even negotiate, which we have found to be true. The owners pick a price out of the air, since we don’t have MLS or comparables, and stick with it. Even as their homes stay on the market for years. I guess they are waiting for their heirs to sell it for them.

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