Panama has experienced a gentle decline in consumer prices in early 2025. From January through April, inflation dropped by 0.4%, while the year-over-year rate showed a larger decrease of 0.7%. These figures come from the National Institute of Statistics and Census (INEC) and are mainly driven by cost reductions in transportation, healthcare, and communication services.
Where Prices Have Gone Down
In April alone, the Consumer Price Index fell by 0.2%. Several everyday expense categories saw declines:
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Transportation: -4.6%
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Communications: -3.6%
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Healthcare: -2.4%
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Housing, water, electricity, and gas: -1.9%
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Clothing and footwear: -1.7%
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Home goods, recreation, and culture: each around -0.9%
Food and basic goods also became slightly more affordable, helping ease household budgets for both locals and expats.
Where Prices Are Increasing
Some sectors did see modest price increases. Alcohol and tobacco rose by 3.7%, followed by food and non-alcoholic beverages at 2.1%. The hospitality sector—including restaurants and hotels—grew by 1.7%, and education costs were up slightly at 0.7%.
Impact on Real Estate Buyers and Expats
A lower inflation environment generally brings stability, and that’s positive for real estate investors and future residents. With fewer cost surprises and a stable U.S. dollar economy, Panama becomes even more attractive for buyers looking to stretch their budget.
This environment also helps developers and builders, as construction and utility costs are less likely to spike. That’s good news for those building custom homes or renovating properties—especially in rising hotspots like Boquete or the coastal favorite, Playa Venao.
Real Estate Outlook
Rather than signaling economic slowdown, this mild deflation reflects targeted price corrections. Panama’s economy remains stable and continues to attract interest from foreign buyers, particularly those seeking a high-quality lifestyle at a lower cost than many other destinations.
Stable prices and affordable living costs add up to strong value in the property market—especially for expats and retirees looking for a safe, vibrant place to call home.
Looking to Buy in Panama?
At Casa Solution, we specialize in helping expats and international buyers find their ideal property in Panama. Whether you’re searching for a mountain escape or a beachfront retreat, our team is ready to help you take the next step.
Contact us today to explore your options and learn how we can assist with your real estate goals in Panama.
