Pre-construction property purchases have become a common feature of international real estate markets. Buyers commit to a unit before it is built, typically at a price agreed at the time of signing, with construction completed over months or years. In established domestic markets, the process is reasonably well understood. In international markets, it requires a more deliberate approach.
For North American buyers exploring markets like Panama, Costa Rica, or Thailand, off-plan purchases are often the first opportunity they encounter, and frequently the one with the most questions attached to it.
Why Off-Plan Is So Common Internationally
In many international markets, off-plan purchasing is the norm rather than the exception. Developers in markets with high construction activity rely on pre-sales to fund development, and buyers who commit early typically do so at prices below what completed units will eventually command. The dynamic is structural. Developers need capital, buyers want access before a project is fully priced, and the two interests align at the pre-construction stage.
In Panama’s most active development zones (Playa Caracol, Santa Maria, Ocean Reef), most available inventory from major developers sells before construction is complete. Buyers who wait for finished product often find fewer options at higher prices. The same pattern holds in parts of Costa Rica’s Southern Zone and in Thailand’s condominium market.
What the Process Actually Looks Like
Off-plan purchases in most international markets follow a staged payment structure rather than a single transaction. A buyer typically pays a reservation deposit to secure a unit, followed by a down payment at contract signing, with the balance due at construction milestones or at completion. In Panama, for example, a common structure involves paying a percentage of the purchase price during construction, with the remainder financed or paid at handover.
That staged structure has practical implications. A buyer needs to understand not just the total price but the payment timeline, what happens if a milestone is delayed, and what protections exist if a developer fails to complete. These are not hypothetical concerns. They are standard questions that any reputable developer and attorney should be able to answer clearly before a contract is signed.
Steve Luther, Principal, Chief Strategist & Advisor, who leads CHORD Real Estate’s international division and has personally purchased off-plan property in Panama, describes the due diligence process as more relationship-driven than a domestic transaction. Visiting the site, meeting the development team, reviewing what the developer has already completed, and speaking with existing owners in earlier phases are all part of building the confidence that a wire transfer requires.
Vetting the Developer
Developer track record is the single most important variable in an off-plan purchase abroad. A developer who has delivered previous phases on time and to specification is a meaningfully different counterparty than one on their first project. In markets where institutional names (Westin, Margaritaville, Grupo Los Pueblos) are attached to a development, that association carries its own form of due diligence, because global brands do not put their names on projects they do not expect to complete.
Beyond brand association, buyers should review the developer’s existing portfolio, speak with owners in completed projects where possible, and work with a local attorney who is independent of the developer. That last point is worth emphasis: legal counsel in an off-plan purchase should represent the buyer’s interests exclusively, not the transaction.
Currency, Timelines, and Expectations
International off-plan purchases introduce variables that domestic buyers do not typically manage. Currency is one: in dollarized markets like Panama, this is not a factor, but in markets where the local currency fluctuates, a buyer needs to understand how their payment obligations are denominated and what exchange rate risk looks like over a multi-year construction period.
Construction timelines are another. International projects, like domestic ones, can experience delays. A buyer whose financial planning assumes completion at a specific date needs a buffer. Most experienced advisors recommend treating any developer-provided timeline as a guide rather than a warranty, and planning personal finances accordingly.
The Role of Local Infrastructure
An off-plan purchase is, by definition, a bet on where a location is heading rather than where it is today. That makes infrastructure context more important than it would be for a completed property in an established neighborhood. Buyers in Panama’s western corridor are purchasing alongside a government infrastructure program that includes transit, highway, and bridge investment. Buyers in established beach markets in Costa Rica are purchasing into a tourism economy with decades of demonstrated demand.
Neither context is a warranty. Both are relevant inputs to a decision that involves committing capital today to a property that will exist in a form the buyer has not yet seen.
That is the nature of off-plan purchasing anywhere in the world. Done with proper legal support, a vetted developer, and a clear-eyed understanding of the payment structure and timeline, it is a well-established route into international property markets. Done without those foundations, it carries risks that are entirely avoidable.
About the Expert: Steve Luther is Principal, Chief Strategist & Advisor of CHORD Real Estate, a Nashville-based firm with an international division focused on markets including Panama, Costa Rica, Colombia, Thailand, Dubai, and The Bahamas. chordrealestate.com
Disclaimer: This article is intended for informational purposes only and does not constitute legal, financial, or investment advice. Readers should conduct their own due diligence and consult qualified professionals before making any investment decisions.
