Panama City has an extensive selection of hotels, yet there is often a shortage of rooms at everything but the budget levels, which means you'll want to reserve well ahead of time, especially for the December-May dry season. If you travel off-season, or reserve through the Web sites of the big hotels, you should be able to get rooms for considerably less than the rack rate. The city's best hotels are quite nice, and varied enough in what they offer to suit most tastes, but some can suffer from poor service. Nevertheless, travelers on a budget can find a variety of comfortable accommodations for less than $100, including hotels with swimming pools and Internet.
