Countries › Panama › Guide › 11. Real estate and land › Leases in Panama: freedom of contract for commercial and most residential leases since 1995, the written contract, the one month deposit held by the Ministry of Housing, and the legacy protections of Ley 93 de 1973

Leases in Panama: freedom of contract for commercial and most residential leases since 1995, the written contract, the one month deposit held by the Ministry of Housing, and the legacy protections of Ley 93 de 1973

Last verified: 2026-10-29 · Status: Stable

Panama's lease law, Ley 93 de 1973, still governs leases, but executive decrees of 1994 and 1995 took commercial, professional, industrial and teaching leases, furnished rentals, homes renting above B/.150 a month and new leases of vacant homes out of most of its rules, leaving them to freedom of contract. A core set of rules still applies to all of them: no discrimination, a written contract on official forms, filing a copy with the Ministry of Housing within five working days, and a deposit equal to one month's rent held through the Ministry. The older rent control, three year minimum term and eviction limits apply only to leases that remain within the law.

Panama's currency, the balboa (B/.), is at par with the US dollar, which circulates as legal tender; the Superintendencia de Bancos states that the balboa's value is on a par with the US dollar (checked 29 October 2026). USD figures therefore equal the balboa figures.

Key facts

Lease deposit lodged through the Ministry of Housing	1 months of rentLey 93 de 1973 art. 13 (Ley 259 de 2021), as of 2026-10-29 · in force
Monthly rent above which home leases follow freedom of contract	150 PABDecreto Ejecutivo 294 de 1994 art. 1, as of 2026-10-29 · in force
Tenant notice to end a housing lease early	30 calendar daysLey 93 de 1973 art. 10 (Ley 55 de 1976), as of 2026-10-29 · in force
Exchange rate used for USD conversions	1 PAB per USDBalboa at par with the US dollar (Superintendencia de Bancos), as of 2026-10-29 · in force

The rule

1. Leases of private real estate for housing, commercial premises, professional use and industrial and teaching activities are a matter of public order regulated by Ley 93 de 1973; leases priced by the day, such as hotels and guest houses, and seasonal holiday homes leased for up to six months are excluded. The Executive may exclude categories of leases from the law by decree, which then follow freedom of contract.Ley 93 de 1973 arts. 1 and 3; art. 1 as amended by Ley 28 de 1974, arts. 1 and 3, 1974-03-12 official text · verified 2026-10-29

2. Leases of private homes with rent above B/.150 a month are excluded from Ley 93 de 1973 and governed by freedom of contract, except for arts. 4 to 8, 10, 13, 16, 19, 20, 65, 66 and 68, from 30 March 1995.Decreto Ejecutivo 294 de 1994, art. 1, 1994-12-07 official text · verified 2026-10-29

3. Also excluded from Ley 93 de 1973, save arts. 4 to 8, 10, 13, 16, 19, 65, 66 and 68: leases of furnished rooms, leases of vacant private homes signed from the decree's entry into force, and leases of private property used for commercial establishments, professional use, industrial or teaching activities.Decreto Ejecutivo 7 de 1995, art. 1, 1995-01-10 official text · verified 2026-10-29

4. Leasing may not be refused for reasons of race, marital status, sex, nationality, age, colour, political or religious belief or having children. Every lease must be in writing on the forms supplied by the Dirección General de Arrendamientos of the Ministry of Housing, stating the parties, the property and its registry data, the rent, the term and the use, and the landlord must deliver a copy to that office within five working days of signing.Ley 93 de 1973, arts. 4 to 6, 1973-10-04 official text · verified 2026-10-29

5. Tenants must lodge, through the landlord, a deposit equal to one month's rent, managed separately from the Ministry of Housing's operating accounts through Banco Nacional de Panamá and Caja de Ahorros; landlord claims for unpaid rent or damage must be proved before the Dirección General de Arrendamientos, and otherwise the deposit and its interest are returned to the tenant when the lease ends.
Cost to do it: One month's rent as deposit.
Example: Rent of B/.1,500 a month: B/.1,500 deposit. / US$1,500 rent, US$1,500 deposit.Ley 93 de 1973 art. 13 as worded by Ley 259 de 2021 art. 1, art. 13, 2021-12-02 official text · verified 2026-10-29 · changed: Ley 259 de 2021 rewrote art. 13 so that deposits are kept in separate accounts at Banco Nacional de Panamá and Caja de Ahorros and returned with interest.

6. For housing leases, the term and its extension bind the landlord, but the tenant may end the lease at any time with at least thirty calendar days' written notice; if notice is omitted, the Dirección General de Arrendamientos may order the deposit, in proportion to the days not notified, paid to the landlord.Ley 93 de 1973 art. 10 as worded by Ley 55 de 1976 art. 9, art. 10, 1976-09-07 official text · verified 2026-10-29

7. Subleasing needs the landlord's prior express consent, but in leases of commercial, professional, industrial and teaching premises a clause prohibiting subleasing is not valid.Ley 93 de 1973, art. 19, 1973-10-04 official text · verified 2026-10-29

8. For leases still fully within Ley 93 de 1973: the minimum term is three years with a right to renewal if rent is current; rent increases need Ministry of Housing authorisation, with a fair and reasonable return of up to 15 percent net a year on the total cost of the property; eviction for arrears requires two or more months unpaid; and eviction to recover the home for the owner's family up to the third degree, for conversion to horizontal property or for demolition gives the tenant one month for each year of tenancy, at least one and at most six months.Ley 93 de 1973 arts. 9, 38, 46, 47 and 49 (arts. 38 and 46 as amended by Ley 28 de 1974 arts. 4 and 6), arts. 9, 38, 46, 47 and 49, 1974-03-12 official text · verified 2026-10-29

9. Leases of real estate for six or more years must be in a public deed to be effective against third parties.Código Civil art. 1131 numeral 2 as worded by Ley 43 de 1925 art. 1, art. 1131 numeral 2, 1925-03-13 official text · verified 2026-10-29

Worked example

A company rents a Panama City apartment for an expatriate manager at B/.1,500 (US$1,500) a month on a two year lease.
Because the rent exceeds B/.150 and it is a new lease, freedom of contract governs the term and price, but the contract must be on the official form, filed within five working days, and a B/.1,500 deposit lodged through the Ministry of Housing.
If the manager leaves early, the company can end the lease with thirty days' written notice under art. 10.

Step by step

Use the Ministry of Housing lease form and sign it in writing.
File a copy with the Dirección General de Arrendamientos within five working days.
Lodge the one month deposit through the Ministry, not privately.
For terms of six years or more, sign the lease as a public deed and register it so a buyer must respect it.
For short stays under six months, check ITBMS and condominium reporting rules.

Common traps

A deposit kept privately by the landlord does not follow art. 13, which survives the 1994 and 1995 exclusions.
Older leases of homes at B/.150 or less signed before 1995 may still carry rent control and eviction limits.
In commercial leases, a ban on subleasing is unenforceable.
Seasonal holiday home rentals up to six months and daily rentals are outside Ley 93 de 1973 altogether.

Sources

← Selling property in Panama: 10 percent tax on the gain, the 3 percent advance that can be final, and the scale for developersRental income in Panama: territorial income tax at 0 to 25 percent for individuals and 25 percent for companies, and 7 percent ITBMS on commercial and short leases →

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