Panama’s official construction and property statistics tell a more interesting story than a single growth number could. In 2025, the market did not simply rise or fall, it split. Houses and land pulled the overall numbers down while apartments quietly kept climbing. Now, three months into 2026, the data from Panama’s National Institute of Statistics and Census (INEC) suggests that split is resolving in the market’s favor, with construction investment posting its strongest start to a year in five years.
2025 in Two Numbers: Minus 2.8%, Plus 11.1%
According to INEC figures reported by La Estrella de Panamá, total registered properties in Panama fell 2.8% in 2025. That headline number, though, was driven almost entirely by one segment: non-horizontal property, meaning standalone houses and land, which dropped 6.5% for the year, with mortgages in that category contracting a sharp 13.5%, transfers down 6.4%, and new properties created down 4.2%. Horizontal property, meaning apartments under condominium-style ownership, moved in the opposite direction entirely. That segment grew 11.1% in 2025, powered by a 15.4% jump in apartment mortgages, an 11.0% increase in transfers, and 6.1% growth in newly created units. In plain terms, 2025 was a weak year for house-and-land buyers financing large purchases, and a strong one for apartment buyers and the banks lending to them.
January 2026: The Strongest Start to a Year Since 2021
Whatever hesitation defined 2025 appears to be breaking. Construction investment in January 2026 reached $115.6 million, the highest figure recorded for that month in five years, according to INEC data reported by La Prensa, a 29.3% increase over January 2025’s $89.3 million. Residential construction accounted for $75.7 million of that total, with the district of Panama alone responsible for $65.8 million of the residential figure and $93.5 million in permits overall. Momentum carried into the first quarter: permitted construction area nationwide grew 26% in Q1 2026 versus Q1 2025, 412,207 square meters against 326,956 the year before, ending two consecutive years of decline in the sector.
What Is Actually Selling
Aldo Stagnaro, president of Grupo Stagnaro and former head of Panama’s Association of Real Estate Brokers and Developers (Acobir), told La Prensa that the units moving fastest right now are small, centrally located apartments, generally between 40 and 125 square meters, priced between $3,800 and $4,000 per square meter. “The big ones, the oversized units, aren’t moving anymore,” he said, describing a market that has shifted decisively toward compact, efficient layouts designed for buyers who either want to move in immediately or rent the unit out. On the house side, Stagnaro pointed to Costa del Este, Costa Sur, and Juan Díaz as the neighborhoods still holding steady residential demand, while Panamá Pacífico has become one of the fastest-growing markets for new house construction, with prices there regularly topping $400,000. Across the board, he described buyers as increasingly drawn to master-planned communities with private security, amenities, and nearby services rather than a standalone house on its own. A separate analysis from the industry portal Panama Realty Zone, also cited by La Prensa, found that the most active price band in the city is the $160,000 to $350,000 range, which is selling faster than luxury inventory, with development concentrated in San Francisco, Santa María, Punta Pacifica, and Panamá Pacífico.
The Tax Fight Shaping 2026
A live policy debate sits underneath these numbers. Panama’s 2% property transfer tax (ITBI) on first-home purchases, intended to raise government revenue, appears to have done the opposite. According to a study by Convivienda, the country’s main housing developers’ association, reported by Infobae, the tax was projected to raise $37 million but instead produced $131.5 million in lost ITBMS and income tax revenue, a net fiscal loss of $94.5 million, and an estimated $1.288 billion drag on the broader economy, equal to 1.6% of GDP in 2025. Convivienda’s executive director, Elisa Suárez de Gómez, argued the tax excludes thousands of families from homeownership and blunts construction’s multiplier effect on the economy. That argument lines up with the property-tax exemption bill Panama’s Cabinet approved on July 30, which would restore a full exemption for new homes up to $120,000 and apply reduced, tiered rates above that threshold, though the bill still needs a vote in the National Assembly before it becomes law.
The 2026 Forecast: 38% More New Homes Sold
Convivienda’s own projections, also reported by Infobae, anticipate 5,530 new housing units sold in 2026, a 38% jump from the 4,020 units delivered in 2025. Most of that 2025 volume, 81%, moved through Panama’s preferential interest rate program, in a price range between $40,000 and $60,000, underscoring how much of the country’s housing volume still runs through entry-level, government-supported financing rather than the luxury segment that tends to dominate real estate headlines. Panama’s construction sector overall is projected to grow 4% to 6% in 2026, supported by state infrastructure projects, private investment, and continued demand under the preferential financing program.
Rents and Resale Prices: The Numbers Worth Watching Closely
Separately from the official INEC and Convivienda figures, industry market trackers have reported rental price increases of roughly 8% to 15% over the past six to twelve months, with the sharpest gains concentrated in high-demand neighborhoods like El Cangrejo, Costa del Este, and Marbella. The same sources put national resale price appreciation at 3% to 5%, with infrastructure-adjacent zones running higher, in the range of 5% to 7% for corridors like Costa del Este and Santa María. Worth noting for accuracy: these specific percentages come from real estate market-analysis outlets rather than INEC or another government statistical body, so they should be read as informed industry estimates rather than official figures. Directionally, though, they line up with what the official data shows: apartments in well-located, infrastructure-served neighborhoods are the clear center of gravity in this market right now.
Why This Matters for Buyers Right Now
Put together, the picture is a market that spent 2025 quietly rotating toward apartments and away from large house-and-land purchases, and is now entering 2026 with the strongest construction and permitting numbers in years. None of this is speculative froth. It is backed by a 26% jump in permitted square meters, the highest January construction investment in five years, and a developers’ association projecting nearly 40% more homes sold this year than last. For buyers watching Panama’s market, the signal is less about any single hot neighborhood and more about a structural shift already underway: smaller, well-located, amenity-rich apartments are what is actually moving, and the financing and construction data back that up.
Casa Solution Can Help
Whether you’re comparing a compact unit in Costa del Este against a house in Panamá Pacífico, or trying to make sense of how the ITBI debate could affect your purchase, Casa Solution’s team can help you read this market accurately instead of relying on headlines alone. Reach out to start the conversation.
Date written: August 7, 2026
