Mario Arias

Does your idea of owning property in the tropics involve a panoramic view of your own private beach, the presence of abundant exotic plants and animals, and the absence of annoyances like noisy neighbors, motorized vehicles, and tourist traps?

If so, then perhaps you should expand your real estate search parameters to include island properties or even entire islands for sale in Latin America.  And, for some really great island options, might we also suggest narrowing your search to Panama.

Off its Pacific and Caribbean coasts lie a number of spectacular, often uninhabited, islands whose ecosystems include rainforests, coral reefs, mangroves, cloud forests, and sandy beaches.  And these are home to tropical flowers, shady palms, ancient trees, and animals you’ve never seen in any textbook.

Once relatively unknown, Panama’s islands have been gaining popularity as the country’s government has taken a number of drastic measures to encourage both tourism and investment in the country and its many archipelagos.  

Today there are a number of private islands for sale, including some that are going for rock-bottom prices, making them primed for impressive appreciation as improvements to the country’s already good infrastructure continue to cause property values to climb.

While there are a few restrictions, it’s entirely possible for foreigners to own islands or waterfront island lots in Panama.  In fact, the entire buying process in Panama is relatively simple compared to many of its Central American neighbors.

We’ve written more extensively about the steps in our Panama real estate guide.  Here’s a quick recap, along with a few stipulations that apply specifically to island property.

Rights of Possession vs. Titled Property

In Panama, there are two types of property available for purchase.  The first is titled property which, once purchased, belongs to you and is titled in your name in the public registry.  You pay taxes on it and can do with it as you wish.

With Rights of Possession (ROP) property, the title is owned by the Panamanian government.  You can still use it however you’d like.  You just don’t hold the title and, consequently, you don’t pay property taxes.

Sound kind of cool, yet a little bit scary at the same time?  Yeah, you’re right on both counts.  ROP property can be a great investment.  It’s also one of the best, if not only, ways to get your hands on some really desirable real estate in Panama, as most (but not all)  islands and beachfront properties are ROP land. 

The way to eliminate any risks associated with this type of real estate purchase is to do your due diligence to research the ownership rights.  There may be conflicting claims to the property, involving multiple parties or even several generations of family members.  There can also be squatters who might make a claim for the land.

Resolving any of these potential issues on the front end is absolutely essential to purchasing ROP property and being able to walk away from the transaction with peace of mind, knowing no one else can come back and try to take it for themselves.

Don’t Even Start the Process Without Consulting an Attorney

At this point, it may go without saying (but we’re going to say it anyway)…you absolutely need to hire a qualified attorney who has experience with all types of real estate transactions in Panama, including island real estate and ROP property.  

And, by experience, we mean someone who has verifiable references or who comes highly recommended by another friend or professional whom you know and trust.  Not just the one with the best website or the neatly bundled real estate buying package with the price tag that ends in $???.99.

Even if your real estate transaction seems straightforward enough, we strongly suggest hiring a qualified attorney, realtor, and any other professional(s) you need to handle the entire process and save you a lot of headaches.  Having a team of professionals you can trust is the most important piece of the puzzle that comes together into a picture of you lying in that hammock without a care in the world.

The Buying Process

At the end of the day, the process of buying an island in Panama looks a lot like buying real estate pretty much anywhere in North America.  You’ll search online or with a realtor and look at places you’re considering.  Note: There’s no MLS in Panama, so you do have to get a bit more creative in order to find available properties. Our Panama Real Estate site is a good place to start.

Once you find the right one, you’ll sign a contract and pay a deposit, like earnest money.  Once the title or ownership rights have been researched (this is generally the longest part of the process and may also include a survey), you’ll complete a bill of sale and have it notarized.  Then a new title or certificate will be created and approved.

When all is in order, and not a minute before, then you’ll actually transfer the money to the seller from the bank or escrow company who’s been holding it in trust.  You’ll also pay any other applicable commissions or service charges, like closing costs.  If your property is titled, it can then be recorded in the public registry.

A Note About Waterfront Property

There is a specific restriction regarding beachfront property, which also affects island owners.  The first 20 meters from the high tide mark on all Panama beaches is public access.  So if you plan to build anything within this area, you’ll need to obtain a concession.  This applies to anything from a pier to entire home on stilts over the water.

This process can take a while, and unfortunately you’ll need the concession in order to get a building permit.  The good news is that this only applies to the public access area.  All that means is that you’ll need to build your house first, while your request is awaiting approval, and then the dock or waterfront gazebo can come later.

Panama’s Most Attractive Archipelagos

So, now that you know how, all that’s really left is WHERE you should search for your island home in Panama.  Here are a few of the most beautiful and popular choices.

VivaTropical

Boca Chica

When we mentioned those areas where island real estate can be had for a bargain with some incredible investment potential to boot, this is the main place we had in mind.  Boca Chica, on Panama’s Pacific coast, is a true hidden gem that is just beginning to come into its own as a destination for island lovers, fishing enthusiasts, and investors.

With over 50 islands, boasting all kinds of ecosystems, this archipelago is absolutely breathtaking.  There’s currently little in the way of tourist infrastructure, which offers a practically blank slate for entrepreneuring expats.  

And tourists are definitely anticipated, as the nearby (less than an hour away) Enrique Malek International Airport in David will soon be receiving flights from the U.S. and other destinations for the first time ever.  These along with several other infrastructure improvements will mean big things for the Boca Chica area.

The islands themselves, including Boca Chica Island, a 400-acre private development and the home of our latest Adventure Colony, are wild and untouched.  Although only a few minutes from the mainland by boat, you’ll feel like you’re a million miles and several centuries away from civilization.  

Gaspar Serrano

Pearl Islands

Located near the capital of Panama City, the Pearl Islands can be reached in 15 minutes by plane or 2 hours by ferry.  Once there, you’ll feel immediately a part of the rich history of pirates and treasures that gave the archipelago its name.

On the islands you’ll find secluded beaches, bird sanctuaries, coral reefs, and only a few small settlements, although tourism has been increasing as of late.  The islands’ beautiful beaches have formed the backdrop for the filming of several seasons of the hit series “Survivor.”

The calm waters surrounding the islands are ideal for fishing, snorkeling, and sailing.  The enhanced focus on tourism makes these islands another great investment opportunity.

The most visited of the Pearl Islands, Contadora (so named because it was the location where the pirates counted their pearls), is a resort island where many wealthy Panamanians and foreigners own second homes.  There are also a number of luxury tourist accommodations.

Panapro

Bocas del Toro

On Panama’s Caribbean coast, is the archipelago of Bocas del Toro, Panama’s most visited tourist destination.  The epitome of the laid-back Caribbean lifestyle, its postcard-worthy skyline includes a number of dwellings and other tourist attractions built out on stilts atop the water.

This archipelago is a popular place for snorkeling and scuba diving, as well as surfing.  It has also hosted episodes of the “Survivor” series and as a result has been gaining even more popularity among tourists worldwide.

The six large and numerous small islands offer spectacular beaches that stand out against the thick rainforests, making it an ideal place for ecotourism.  However, it also has its share of development, particularly on Isla Colon, which has a fair share of tourist accommodations and a small airport that offers daily flights to Panama City and David.   

Although it’s the most developed of Panama’s archipelagos, there are still remote lots that can be found for a reasonable deal if you’re willing to venture away from the tourist areas.

Seibert

Veraguas Islands

If you’re looking to get out…way out…then Veraguas Island and its surrounding area might be a good place to check out.  This remote group of islands is covered in lush jungles and offers proximity to Coiba National Park, which includes the largest uninhabited, forested island in the Americas.

The islands also boast a varied assortment of marine life, some white sand beaches, and a number of possibilities for their use.  They would make a great setting for a remote residence, an ecotourism outfit, or a private resort in an untouched natural setting.  

These ideas should give you a great start, but there are plenty of other islands to choose from in Panama and beyond.  Check back frequently to our listings of islands for sale throughout Latin America.