Panama continues to strengthen its position as a moderately free economy according to the 2025 Economic Freedom Index published by The Heritage Foundation. Climbing four positions to rank 56th globally with 65.5 points, Panama now stands 10th among 32 countries in the Americas and 5th in Latin America.
This upward trajectory signals positive developments for property investors and homebuyers interested in Panama’s diverse real estate market. While the country continues to face challenges in strengthening rule of law, improving transparency, and enhancing judicial efficiency, its overall economic freedom score exceeds both global and regional averages.
Key Economic Indicators
Panama performed particularly well in several areas crucial to a stable investment environment:
- Low tax burden (86.9 points)
- Efficient public spending (85.2 points)
- Strong trade freedom (78.6 points)
- Solid monetary freedom (76.4 points)
The country’s service-oriented economy continues to function as an international business hub for shipping, distribution services, and banking, creating diverse opportunities for real estate investors.
Impact on Property Markets
Panama’s improving economic freedom rating suggests a generally favorable environment for real estate investment, particularly in established areas like Boquete and Panama City, where stable property rights and business freedoms create a foundation for market growth.
While regulatory efficiency scored well (70.2 points), investors should note that labor market rigidity and judicial system challenges may impact development timelines and business operations. However, the country’s fiscal health (62.4 points) and continued economic openness provide reasonable stability for long-term property investments.
The National Competitiveness Center (CNC) has highlighted that Panama needs additional reforms to encourage formal employment, digitize more administrative procedures, and ensure fiscal sustainability – all factors that would positively impact property development and investment security if implemented.
Outlook for Investors and Residents
For prospective buyers and current property owners, these economic freedom indicators point to a market with solid fundamentals but room for improvement. The stable monetary environment is particularly beneficial for international investors, while Panama’s continued focus on service industries supports demand for both residential and commercial properties.
The country’s position among the more economically free nations in Latin America reinforces its attractiveness for expats and investors seeking stable markets with growth potential outside fully developed economies.
Ready to Explore Panama’s Real Estate Opportunities?
At Casa Solution, we help buyers navigate Panama’s diverse property market, from mountain retreats in Boquete to beachfront condos along the Pacific coast. Our experienced team can guide you through the investment process, helping you benefit from Panama’s growing economic freedom and stable investment environment.
Contact Casa Solution today to discover your perfect property in one of Latin America’s most promising real estate markets.
