Casco Viejo is the site where Spanish settlers decided to start anew in 1673

A busy whirring capital and the world’s most pristine beaches…these things come to mind when potential expats think of Panama. For colonial towns, though, places like Mexico, Guatemala and Ecuador come to mind before Panama. But truth be told, the best colonial towns in Panama are little undiscovered gems, places where intrepid expats can find opportunities galore.

Better-known destinations like Cartagena in Colombia are overpriced and overrun by tourists and droves of street-hawkers. In Panama, though, quiet colonial squares are still used for their original purpose…locals sit in the shade, seeking relief from the noontime heat. Children play as their mothers sit and chat. Little churches look much the way they did centuries ago, when these cities, among the oldest in the New World, were founded.

Though there are many colonial towns worth a quick visit—Parita and La Villa de los Santos come to mind—three stand out as great places to live. For the potential expat looking for colonial charm, these three towns merit a further look.

Best Colonial Town in Panama: Casco Viejo

The first is actually right in Panama City—today known as Casco Viejo, it’s the site where Spanish settlers decided to start anew in 1673. (The dread pirate Henry Morgan had razed their original settlement, founded in the early 1500s, to the ground.) Here churches such as the Iglesia de la Catedral Metropolitana still stand, centuries after they were built.

This area is a personal favorite of mine—I spend a lot of time in Casco Viejo and have friends who live there. The Spanish and French colonial architecture lures and inspires local artists, with wrought-iron grilles and balcony railings that evoke images of times past. The weekend bustle and many activities, as well as crumbling unrestored buildings with peeling paint give the area a true local feel.

But above all there is an air of excitement here. Those lucky enough to live or own property in Casco Viejo feel something special is happening here, and they’re happy to be a part of it. The area is being restored slowly…some say too slowly. But new projects such as the extension of the Coastal Belt highway (which is over halfway complete) and a promised metro line, may make Casco Viejo way more accessible and jump-start gentrification once more.

A Colonial Town in Panama with City Convenience

I always stop in Chitre when I travel to the Azuero region. The capital of the Herrera province, Chitre doesn’t look like much at first glance, but head to the central plaza and you’ll see why it’s so popular. The charm of the plaza and the simple church draws you in, making you want to sit there for hours. At night, the scene is illuminated by lamps and strategically placed lighting, making the little church shine.

Happily, the city of Chitre is growing and offers many conveniences, from upscale supermarkets to housing in every price range (some for as low as $45,000). Despite this growth, the city isn’t crowded, and the outskirts offer green country-living just minutes from the Plaza Central. The fact that there are nearby beaches is a plus, too. You won’t find a large expat community here, and you’ll need a little español to get by. But the people are kind, crime is low, and the infrastructure and health care offerings are excellent.

The Cheapest Colonial Town in Panama: Las Tablas

Just 45 minutes from Chitre you’ll find the town of Las Tablas. While it’s close to the city convenience of Chitre, this is a tiny town built around an ample central plaza. This little colonial town differs from hot retirement destinations like Panama City, Boquete or Bocas del Toro. It’s in an area surrounded by farms and ranches, and that makes the climate, the landscapes, and the people unique.

Here you’re just a half-hour from the beautiful beaches of Pedasi (and the smooth, pristine beach of Uverito is just a 15-minute drive away). You can buy a home for as little as $30,000 and live comfortably on less than $1,200 a month. During the madcap Carnival season that precedes the Catholic Lent, the party comes to you. Las Tablas is Panama’s number one Carnival destination, and locals say the party rivals those of New Orleans and Rio de Janeiro. Las Tablas is located on the Azuero peninsula, which hosts some 700 festivals a year.

Though Carnival is a wild ride, the rest of the year in Las Tablas is deceptively quiet. There are few expats, a smattering of restaurants, hotels and pubs, and little else to do but enjoy the countryside, beaches and colonial feel.

Editor’s Note: Panama is not only the most sophisticated offshore haven in the Americas, with some of the cheapest beachfront in both the Caribbean and on the Pacific Coast, but it also has the best retiree benefits in the world. Learn more about one of the world’s top retirement destination in our just updated Panama: The Owner’s Manual.