Paraguay (PY)
Affordable South American residency hub with low taxes, warm climate, Mercosur access, growing expat communities, and a practical base in Asuncion, Encarnacion and Ciudad del Este.
Buying Property in Paraguay
The full buying process, transaction costs, mortgage, and legal requirements.
Paraguay has one of the most foreigner-friendly property ownership frameworks in Latin America. Foreign nationals have exactly the same ownership rights as Paraguayan citizens — no permit, residency, or special authorisation is required to purchase urban or suburban real estate. Foreigners can hold 100% ownership directly in their own name. One important restriction: rural property within 50 km of an international border (under Ley 2532/2005) is restricted for nationals and entities from neighbouring countries (Brazil, Argentina, Bolivia) without government authorisation — this does not apply to most Western expat buyers. A major modernisation occurred in January 2026: the Registro Unificado Nacional (RUN) came into operation on 14 January 2026, merging the National Cadastral Service and the Dirección General de los Registros Públicos (DGRP) into a single digitalised system — significantly streamlining the registration process. Paraguay uses the Guaraní (PYG) as its currency; property transactions are commonly denominated in USD. Transaction costs are very low by regional and global standards (approximately 3–5% total).
Rent vs. Buy
Paraguay is a compelling long-term buy destination for expats planning stays of 3+ years. Asunción property prices remain affordable by South American standards: a modern 3-bedroom apartment in central Asunción typically costs USD 80,000–200,000; new builds in Barrio Villa Morra and Carmelitas range USD 120,000–350,000. Renting the same properties runs USD 500–1,200/month, making purchase-to-rent yield ratios favourable for buyers. Transaction costs are low (3–5% total). Annual property tax (impuesto inmobiliario) is minimal (1% of cadastral value, which is typically 30–60% of market value). Renting first for 6–12 months is still strongly recommended: neighbourhood flooding, traffic patterns, security context, and building quality are best assessed by living in the area.
Buying Process — Step by Step
Engage an independent lawyer or escribano
Before making any offerHire your own independent lawyer (abogado) or notary (escribano público) before making any offer or paying any deposit. Do not rely solely on the seller's broker or the seller's notary. Your lawyer will conduct title due diligence, prepare the preliminary agreement, oversee the deed, and manage registration. For foreign buyers, ensure your lawyer speaks English or has an English-speaking assistant. The escribano is both the notary and the lawyer in Paraguay's civil law system.
Title verification and due diligence
1–3 weeksYour escribano searches the Registro de Inmuebles (under the RUN system from 2026) to verify: the seller is the registered owner; the title chain is clean; no mortgages (hipotecas), liens (embargos), or restrictions are recorded. Obtain a Certificado Catastro Registral Inmobiliario — the new unified cadastral-registry certificate introduced by the RUN in 2026 that replaces the previous separate cadastral and title documents. Also verify: the property's physical boundaries match the cadastral description; municipal property tax (impuesto inmobiliario) is current; no utility or condominium debts exist.
SEPRELAD anti-money-laundering compliance check
1–2 weeks; prepare documents in advanceFor transactions above USD 10,000, both buyer and seller must comply with SEPRELAD (Secretaría de Prevención de Lavado de Dinero o Bienes) regulations. Your escribano manages this. Prepare documentation of your source of funds — bank statements, wire transfer records, and income proof. This is a mandatory step and foreign buyers should prepare documentation in advance.
Preliminary agreement (seña or boleto de compraventa)
Negotiated; days to weeksIf both parties wish to reserve the property before the final deed, sign a written preliminary agreement (boleto de compraventa or seña) specifying the agreed price, payment schedule, conditions, and deposit terms. Ensure refund conditions are clearly written in the agreement. Deposits (señas) are typically 10–20% of the price. If the buyer withdraws without cause, the deposit is typically forfeited; if the seller withdraws, they return double the deposit.
Execute the purchase deed (escritura pública) before the escribano
Signing day; registration followsThe final property transfer is formalised as an escritura pública (public deed) before a licensed escribano público. Both buyer and seller (or their legally authorised representatives via poder notarial — a notarised power of attorney) must appear. The deed describes the property, the chain of title, the agreed price, and the transfer of ownership. The escribano then submits the deed to the DGRP (now under the RUN system) for inscription in the Registro de Inmuebles.
Pay property transfer taxes and fees
Payable at or before signingThe principal transfer tax is the Impuesto a la Transferencia de Inmuebles (ITI): 3% of the transaction value (verified 2026). Additionally, stamp duty (Impuesto a los Actos y Documentos, IAD) of approximately 1.5% applies. Escribano fees are charged on a tiered scale under Ley 1307/87: approximately 0.75–2% of declared price. DGRP registration fees are modest (approximately 0.1–0.3% of value). For the first sale of a new-build property by a developer, IVA (VAT at 10%) may apply — resales are generally IVA-exempt.
Register the deed and update municipal records
15–60 days for full registrationThe escribano submits the signed deed to the DGRP for inscription in the Registro de Inmuebles. Under the RUN system (operational from January 2026), the digitalized process aims to reduce backlogs. Standard registration time: 15–45 days in Asunción; longer in regional cities. After national registry inscription, file a copy with the Municipalidad's Catastro department to update property tax records into the buyer's name for the following tax year.
Transaction Costs
| Cost Item | Amount | Notes |
|---|---|---|
| Impuesto a la Transferencia de Inmuebles (ITI) — property transfer tax | 3% of transaction value | The primary transfer tax payable on resale property transactions. Typically paid by the buyer. Verified 2026 rate. |
| Impuesto a los Actos y Documentos (IAD) — stamp duty | 1.5% of transaction value | Stamp duty on the legal instrument (deed). Separate from the ITI transfer tax. |
| Escribano (notary) fees | 0.75–2% of declared property price (tiered scale, Ley 1307/87) | Escribano fees are regulated by law. On a USD 150,000 property, expect approximately USD 1,500–2,500. The escribano handles both the deed and the registration submission. |
| DGRP registration fee | 0.1–0.3% of property value | Paid to the Dirección General de los Registros Públicos (now under the RUN) for inscribing the deed in the Registro de Inmuebles. |
| Independent legal due diligence | USD 500–2,500+ depending on complexity | Separate from the escribano's deed fee. Complex title issues, inherited properties, or rural land can significantly increase this cost. |
| Annual property tax (impuesto inmobiliario) | 1% of fiscal cadastral value (paid to the Municipalidad) | Cadastral values (updated +4.1% for 2026 per Decreto 5181/2025) are typically 30–60% of market value, making the effective annual rate approximately 0.3–0.6% of actual purchase price. Paid in two instalments (March and September). Check for arrears before purchase — they transfer to the new owner. |
| IVA (VAT) on new-build first sales | 10% of value (embedded in developer price for new construction) | Applies only to the first sale of new construction by a developer. Resale transactions are generally IVA-exempt. |
| Total buyer transaction cost estimate (resale urban property at USD 150,000) | Approximately USD 6,750–10,000 (4.5–6.5% of purchase price) | Breakdown: ITI 3% (~USD 4,500) + IAD 1.5% (~USD 2,250) + escribano ~1% (~USD 1,500) + DGRP ~0.2% (~USD 300) + legal due diligence (~USD 1,000–2,500). Note: agent commission (3–5%) usually paid by seller. |
The Notary — Mandatory for All Purchases
In Paraguay's civil law system, the escribano público (notary public) is both a legal professional and a state-appointed officer responsible for authenticating property transactions. The escribano drafts the escritura pública (public deed), verifies the title chain, witnesses signatures, calculates and collects taxes due, and submits the deed to the DGRP for registration. From January 2026 under the RUN, notaries are digitally integrated into the unified registration platform. Crucially, the escribano alone is not sufficient protection for a buyer — foreign buyers should also engage an independent abogado (lawyer) for risk assessment, negotiation, and complex due diligence beyond the deed formalisation.
Mortgage
Local bank financing for property in Paraguay is available but conservative. Mortgage lending represents only about 4% of bank lending in Paraguay — most buyers, especially foreigners, purchase with cash or via foreign financing. Interest rates on Paraguayan mortgages in 2026 are approximately 9–11% per annum (PYG-denominated loans may be higher; USD-denominated loans slightly lower). Loan terms range from 10 to 30 years. Banks require extensive documentation and are cautious with non-resident applicants. Developer financing for new-build projects is sometimes available on more flexible terms.
30–50% minimum for foreign buyers (LTV 50–70%). Local residents with established income and banking history may access better LTV ratios. Cash purchases are the norm for expat buyers in Paraguay.
A Paraguayan cédula de identidad (national ID for residents) or cédula para extranjeros greatly improves mortgage access. Banks require local income proof, Paraguayan tax records (RUC or SET filings), and a 6–12 month local banking history. Foreign-source income is typically discounted (hair-cut) in bank calculations. BBVA Paraguay, Banco Continental, Itaú Paraguay, and Banco Nacional de Fomento (BNF) are among the banks most accessible to foreigners with established local status. Many expats use home-country financing (home equity release, portfolio loans) and purchase in cash.
Land Registry
From January 2026, Paraguay's property registration operates under the Registro Unificado Nacional (RUN — run.gov.py), which merges the former National Cadastral Service and the Dirección General de los Registros Públicos (DGRP) under Law 7424/24. The RUN issues the new Certificado Catastro Registral Inmobiliario, a unified document replacing the previous separate cadastral and title certificates. This modernisation aims to reduce the historical backlog (previously 15–45 days in Asunción, longer in regional cities) and eliminate duplicate entries. All notaries were onboarded to the RUN digital platform from January 2026. The DGRP remains the official registry under judicial oversight (Poder Judicial); its consultations portal is at gestiones.csj.gov.py.
Taxes
Property transfer tax (ITI): 3% of transaction value on resale (buyer pays). Stamp duty (IAD): 1.5% of transaction value. IVA (VAT at 10%): first sale of new construction only; resales exempt. Annual property tax (impuesto inmobiliario): 1% of municipal fiscal cadastral value (cadastral values ≈ 30–60% of market value), paid to the Municipalidad in two instalments (March and September); cadastral values updated +4.1% for 2026. Rental income tax: rental income is subject to Impuesto a la Renta Personal (IRP) at 10% of net income for residents; non-residents are taxed at source by the tenant. Capital gains: there is no dedicated capital gains tax on real estate in Paraguay for individuals — gains from property sales are assessed under the personal income regime if declared. Paraguay operates a territorial tax system — income and gains from foreign sources are not taxed.
New Build vs. Existing Property
New builds: IVA (10%) is embedded in the developer's quoted price on first sale. Modern construction standards, energy systems, and developer warranty. Key risk: developer track record and financial reliability — verify the developer's registration, check completed projects, and review the deed carefully before making stage payments. Existing properties: lower entry price and no IVA, but may carry deferred maintenance (roofing, electrical, drainage), and potentially complex title histories. Inspect during or after a heavy rainstorm to assess drainage and roof quality. Older properties in Asunción neighbourhoods may sit in flood-prone zones — verify with the municipal catastro.
Selling Property
When selling, ensure your title is clean and the property tax (impuesto inmobiliario) is current — arrears must be paid before transfer. Capital gains from the sale are taxable under IRP at 10% of net gain for resident individuals. Keep all purchase documentation: original escritura, improvement invoices, and tax receipts — these establish your cost basis. The seller typically pays the real estate agent commission (3–5% of sale price). Foreign sellers should consult a local tax professional and their home-country adviser regarding reporting obligations. Ensure any wire transfer of proceeds complies with your bank's source-of-funds requirements.
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Property Buying
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