Purchasing real estate in Panama can be a very a smooth and simple process so long as it is planned well. Part of the planning involves title considerations. There are two general ways to acquire title to Panama real estate.ay

Titled Property vs. Rights of Possession
The first way of title, is actual title itself. This is an overall very secure means of owning real estate in Panama. The second is "rights of possession" aka "ROP". ROP, in theory, gives ownership in the present time to those occupying the land and any improvements thereof. While there are a few variations on the way ROP works, the original idea was based on use. This meant that farmers or country people, many of whom did not otherwise have the means to buy property, could essentially have ownership interest and use the land. The concept dated back to a time when agrarian reform was under way. Now this has resulted in a chain of title for ROP properties. Those currently holding the right to possess also have certain abilities to transfer and effectively sell the property. The important thing to know is that you are not actually buying the property, you are only buying the right to use the property. That right comes with certain limitations. ROP property is a concession from the government in its own form. For example most waterfront property under ROP are considered to be a concession from the government where you are limited to a period of time. After this period of time has expired, you may or may not have the ability to extend your right of possession to the property. So, if you can not get the extension you are basically out of a property and would lose your investment. Actual occupancy is another consideration as well. Theoretically there are circumstances by which you could lose control of a ROP property for lack of occupancy. There is also the issue of obtaining a mortgage. Cash in full or seller financing is typically the way it goes. There are enough possible topics to cover and scenarios to write an entire book about ROP. We are just giving a synopsis of things to consider before buying ROP.

Actual Titled real estate is generally the best way to go and provides for the most secure investment. Especially true if you are not going to be living on the property full-time. We caution you in all real estate purchases and while we recommend Title property there are still some sincere values and even bargain to be found in ROP property.

When it comes time to buy..
You can work with or without a real estate broker. If you do, keep in mind that they are often working for the seller and may not represent your best interests. They often do not disclose this. Also, be sure that you are not working with an attorney that has interest in the real estate you are considering. Hire someone with the right experience and ask questions about anything you are not certain about. Purchasing property in Panama comes with a presumption that the "buyer beware" and therefore the buyer is responsible to have all inspection, investigation and verification throughout the process.

We are here to assist you and handle your legal needs when purchasing or selling Panama real estate. Contact us anytime if you have questions.

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