Can foreigners own property in Costa Rica?
Yes, foreigners are permitted to own property outright in Costa Rica.
Foreigners have the same property rights as Costa Ricans. Private property is
protected by the Constitution of Costa Rica. It is no different than owning
real estate in the US or Europe. Costa Rica is definitely a beautiful country
to live, invest and retire.
What are the restrictions for a foreigner to buy property in Costa Rica?
There are no restrictions that specifically apply to foreigners when
purchasing property in Costa Rica. A Costa Rican partner is not required
to buy land in Costa Rica.
What is the procedure to buy a Costa Rica property?
First: After you have found the right
property with your Real Estate agent, have them
submit an Offer to Purchase (also known as a Letter of Intent) to the Seller or
the Seller’s listing agent in order to agree upon the sales price and basic
terms of the deal.
Second: Once the Offer is accepted,
you take it to your Costa Rica attorney and they draft the formal Sale and
Purchase Agreement. This document is a legally binding document, and it
clearly states all conditions necessary for the transfer of the deed.
Third: The period of Due Diligence,
which is the complete legal research of the property to insure there are no
liens, contingencies, legal issues, and that it has absolute fee simple title.
Surveys, soil tests, home inspections, and other studies requiring
professional services are included in this period. If the property is
being sold with an existing company, then the research of the company for any
legal contingencies will also be completed during Due Diligence.
Fourth: The Closing (conveyance of the
deed) occurs before a Costa Rican Notary Public, who will register the property
under the new company or owner. Alternatively, if the property is being
purchased with an existing company, then the shares of the company are
transferred at this time by a Shares Transfer Agreement. In this case the
Notary Public will make the corresponding changes to the company’s ownership in
the National Registry.
Fifth: Declaring the property before
the corresponding Municipality for property tax purposes by filling out a
simple form and presenting it along with the some other documents either
yourself or through your attorney.
Can I acquire a property under my personal name, even being a foreigner?
Yes, however, it is more common and recommended to acquire the property
through a corporation in order to separate potential personal liabilities,
facilitate the closing procedure, and allow for easier transfer to relatives in
case of casualty. The Costa Rica holding company will also make it easier
to obtain services such as electricity and cell phones, as well as, opening a
bank account.
Exception: A foreigner can only own up to 49% of the concession rights
for a Concession Property within the Maritime Terrestrial Zone (MTZ).
Without getting too technical, the MTZ is limited to the area 200 meters
from the median high tide line. All other property outside of the
200-meter zone can be owned free and clear.
If I live outside of Costa Rica, do I need to be present to sign for the
transfer of the deed at closing?
Although recommended, the answer is no. The closing can be
executed through a Power of Attorney with a third party in Costa Rica that you
trust. This Power of Attorney can be specifically for the sole purchase
and signing the closing document. Another option is to DHL or FedEx the
documents after signing them in front of a licensed Notary Public at your
nearest Costa Rica Consulate. Considering the cost of the shipping and the
distance to the nearest Costa Rica Consulate, many buyers fly down and sign in
person.
What are the common taxes, legal fees, and closing expenses included in
the purchase of property in Costa Rica?
Transfer Tax: This
is a national tax of 1.5% of the purchase price that is paid (by your lawyer)
to the National Registry. Prior to 2013, the cost for transferring the
shares (instead of a direct property transfer) of the existing corporation to
the new owner was significantly less. Now in 2013, that option does not
offer any significant financial savings. These costs are often split by
the Buyer and the Seller.
Legal Fees: for
the purchase of property in Costa Rica are 1% to 2% depending on the sales price, complexity of the
transaction, and the allotted time spent by the attorney on the deal.
Additional legal costs may include the formation of a Costa Rica corporation of
around $600 USD; drafting of any supplementary contracts or Seller Financing Agreements
and registering of such contracts; and translation of contracts into your
native language. The Buyer and Seller typically pat for the separate
attorneys. If one attorney is used by both Buyer and Seller, then some
for these legal fees can be split. However, the Buyer is usually solely
responsible for starting a new company, any contracts for Seller Financing (if
needed) and registration of those contracts, and translations if the Seller is
Spanish speaking.
Lesser Fees include:
Registry: 5 colones per every 1,000
colones of purchase price
Municipal: 2 colones
per every 1,000 colones of purchase price
Fiscal: a maximum of 625 colones
Bar Association: a maximum
of 10,000 colones
Archive: 20 colones.
Other Closing Fees: may
include topographer fees when you have the boundaries of the property (the cost
of which varies depending on the size and terrain), soil tests, home
inspections, etc. These items are typically paid by the Buyer.
Total property transaction costs are about 4% of the property’s value,
and are usually split 50/50 between buyer and seller.
How can I transfer funds for a property acquisition from my home
country?
The easiest way is to make an international wire transfer from your home
bank to an escrow company in Costa Rica. These registered companies are
dedicated to protect funds and provide escrow services in Costa Rica. A direct
wire transfer from the Buyer to the Seller can be done in certain cases.
Where and how are properties registered in Costa Rica?
All titled properties are registered in the Registro Nacional or
National Registry located in Zapote, San Jose, Costa Rica. There are
satellite offices of the “Registro” around the country in larger cities.
This is the agency that keeps the public, property record with the owner’s name
or corporate name, any liens, mortgages, or damages against the property.
In order to transfer a registered property the recorded owner must appear
before a Notary Public and that signed documentation is then presented and
recorded in the National Registry.
Exceptions: (1)
Concession property located in the Maritime Terrestrial Zone (MTZ); which is
the 200 meters from the median high tide mark on both Pacific and Caribbean
coasts. The first 50 meters is public zone and free for the public to
enjoy, where as the remaining 150 meters is the restricted zone where
concession property can be granted by the local municipality.
Although there can be titled property with the MTZ, it is very rare and may
have been titled since before the MTZ was put in place; but should be carefully
investigated by your Costa Rica attorney to insure the validity and legality of
the title.
Concession property is registered in different section of the National
Registry called the Concession Registry and has an independent registration
number. Concession property is typically used for tourism and if this
type of property is a consideration, then it is highly recommended your
attorney review the concession and feasibility of your plans for the property
before pursuing it further.
(2) There are also Possession Properties, which are untitled and are not
registered in the National Registry. These properties can obtain title
through a lengthy process and if they comply with certain requirements; one of
which is a minimum possession of 10 years. These types of properties are
the most risky and professional legal counsel is needed in this situation to
advise if receiving title is possible before even considering such a property.
What is a Plano Catastro?
Recorded and titled property has a planocatastro, also known as, a
survey plan. It details the boundaries of the property, the total size,
ownership, the Folio Real number, and the date it was registered among other
things. Planos, as they are referred to in Costa Rica, can be found in the
Registro Nacional (Public Registry), as well as, at the municipality in which
the property is located.
What is a Folio Real number?
All registered properties have a folio real number (i.e. 6-123456-000)
of which the first number represents the province where it is located, the
second refers to the specific folio property number, and the third to the
property rights as in number of owners (000 means only one owner).
How can I check the status of a property in Costa Rica?
You can go to the National Registry: http://www.rnpdigital.com/index.htm where anyone can check the status of a property. Go to
“Sistema de Certificaciones y ConsultasGratuitas” on the top left side of the
webpage. A new tab will open and then first time users will have to go to
“Registrarsepor Primera Vez” in the top left hand portion of the page.
After filling out the form you will receive an email and click on the link and
enter your user email and password on the left hand side under “Ingreso para
UsuariosRegistrados”. Then go to “ConsultasGratuitas” on the left hand
side and next you will see a list of all the types of “Consultas” you can do
for “BienesImmuebles” (Real Estate). To obtain a certified property
report click on “ConsultaporNumera de Finca”. After this, you will have
to enter the number of the property’s province or “Provincia” (first number of
the Folio Real number on the Plano), the folio real number of the property
(middle numbers of the Folio Real number on the plano), and the number of the
property right “derecho” (which is the last 3 digits of the Folio Real number
on the Plano). Once you enter the said information click on the “Consultar”
(consult) button. A certificate with all the information of the property
will appear on the screen.
How much are property taxes and other taxes associated with owning
property in Costa Rica?
Property Tax: This
annual tax is 0.25% (one quarter of one percent) of the registered property
value and are paid to the local Municipality for where the property is
located. These taxes are paid every 3 months or can be paid in full for
the year in advance. For example a $100,000 USD property pays $250 USD
per year in Property Tax. Low property tax is one of the many reasons to
invest in Costa Rica real estate.
Corporation Tax: This new
tax was passed in 2012, and it is a fixed fee of $180 USD for inactive
corporations and $360 USD for active corporations. Most properties are
held in an inactive corporation, because it will not be reporting income.
If you have a rental property, you can open an additional, active
corporation to report income and expenses. These taxes are paid to the
“Ministerio de Hacienda”.
Luxury Tax: A
tax levied against luxury homes valued at $250,000 USD and is also paid to the
“Ministerio de Hacienda”. This tax is around $2,500 and up depending on
the registered value of the home.
Why buying in Costa Rica rather than any other Central American country?
Costa Rica is, by far, the best place to invest in Central America.
Almost 60 years of democratic tradition, a nonexistent army, 97% literacy, and
a prosperous, fast developing country makes buying and investing attractive.
Costa Rica is a great place to retire or raise a family. An ecologically
oriented country, Costa Rica offers beautiful national parks, amazing beaches,
wonderful adventure sports, and relaxation. Here you will enjoy the advantages
of living in the tropics with all the conveniences of a developed country.
Lifestyle and Immigration FAQ
When coming to Costa Rica, do I need a passport or/and visa?
As a tourist, you need a passport, but you do not need a visa if you are
planning to visit less than 90 days. If you are already in Costa Rica and want
to stay longer than 90 days, then you’ll have to leave the country for 72 hrs
and re-enter legally again for another 90 days. You can exit into Panama or
Nicaragua; both countries border Costa Rica.
Your passport should be valid for at least 60 days after the arrival
date. You should always carry it. A copy of the passport and stamps may not be
enough as proof of legal status. It is a good idea to register with the
Consular Section of the US Embassy to let them know how long you would be in
the country.
What do I need to pass through Customs?
One customs declaration form should be filled out per family, and this
form is usually handed out on the plane or boat when you enter the country.
They are also available in the baggage claim area in the airport terminal. You
will not have to pay for any personal luggage, unless it is new in a box. If
you bring multiple units of the same item, the customs’ officer could deem them
to be commercial goods and assess a customs fee.
Your luggage could be inspected, and you must fill out a customs’
declaration. This list should include any alcoholic beverages, electrical
appliances, any computer and electronic equipment, and food or biological
products.
Do I require a specific vaccine to enter Costa Rica?
For most North American, Central American, and European visitors, the
answer is no. The Yellow Fever Vaccination is required to people that
live in certain countries in South America and Sub-Sahara Africa. People from
Angola, Benin, Burkina Faso, Cameroon, Democratic Republic of Congo, Gabon,
Gambia, Ghana, Guinea, Liberia, Nigeria, Sierra Leone, Sudan, Bolivia, Brazil,
Colombia, Ecuador, Peru, French Guiana and Venezuela are required to have an
International Certificate of Vaccination against Yellow Fever.
Do I need to get a Costa Rican Driver’s license?
Your own driver’s license with a valid passport will allow you to drive
in Costa Rica. However, it will only be good just for 3 months, as per Costa
Rican immigration/visa requirements. You may rent a car with your driver’s
license, passport, and a credit card. If you have your Costa Rican residency,
you can apply for a Driver’s License.
When is it best to visit Costa Rica?
Anytime of the year is a good time to visit Costa Rica. This really
depends on individual taste and on the activities you want to experience during
your stay.
If you are looking for maximum sunshine and water activities, the Dry
Season (also known as, the High Season) may be your best option. From December
thru April, the weather is sunny and warm (hot at sea level). Beach resorts and
tour companies are very busy during this time of the year. The Peak Season
includes Christmas, New Years, and Easter. These three weeks are the most
expensive and busy of the year. Finding accommodations can be difficult during
this time, so plan ahead.
The Green Season (Rainy Season) typically runs from May to November.
The countryside is lush and the rivers and creeks are full. There is
usually sun in the mornings and rain, typically for a couple of hours, in the
afternoon. Some days it may rain for more than that or until next day, but
those are the exception. The Green Season is attractive because the price for
rooms and rentals are lower.
Are dollars accepted in Costa Rica or I have to change currency?
The official currency in Costa Rica is the Colon. Most prices will be in
colones but you will find some stores (specially souvenir stores) that have all
items marked in dollars. Credit cards and dollars are accepted almost
everywhere but not in $50 or $100 bills. Smaller bills will always be accepted.
All major credit cards are accepted (Visa, Master Card, AMEX)
What documents do I need to get married in Costa Rica?
Costa Rican law permits U.S. citizens to get married here. A lawyer can
perform the required legal ceremony. You will need the following documents:
- A valid
passport;
- A
certified copy of your birth certificate;
- If you
have been married before:
- 1. A
certified copy of the divorce decree or
- 2. A
certified copy of your previous spouse’s death certificate;
- If you
have not been married before, you must come to the Embassy’s Consular
Section and make a sworn statement to that effect before a consular
officer (there is a $30 fee for this service).
If you are marrying a Costa Rican citizen, he/she will need:
- A Costa Rican ID (cédula de identidad)
- A
Certificate from the Civil Registry that he/she is single (certificado de
soltería del Registro Civil).
In the United States, laws regarding marriage vary from state to state.
Please contact the County Clerk’s office in the county in which you plan to
reside in or in which you are a resident with any questions regarding
recognition of your Costa Rican marriage documents in the United States.
(Information provided by the US Embassy)
How can I get a job or internship in Costa Rica?
Some Americans can get a job in Costa Rica. They may teach English in one of many private language schools in
Costa Rica. The salary is not very attractive for US standards. If you have an
elementary or secondary education certification you might get a job in a
primary and secondary school as a teacher or office clerk also. You may also
try at one of the English Language publications like The Tico Times, The Beach
Times, For Sale by Owner, among others. You may get lucky and get a job at a
beach hotel and be near the ocean (Wow!) Just remember that these jobs are not
legal because only residents and citizens are allowed to work in Costa Rica.
You can also volunteer in Costa Rica. There are some U.S. non-profit
programs such as “World Teach” that place volunteers in Costa Rica every now
and then. The Costa Rican Embassy in Washington may help you on this topic.
There are also volunteer opportunities with the Costa Rican Energy and
Environment Ministry.
What should I bring on my trip to Costa Rica?
Every person has different needs and desires, but here are a few things
that may improve your experience:
Medication: if you
are allergic to some insect bites or plants or food, pack your medicine. There
are pharmacies all over Costa Rica, but we recommend that you bring your own.
Get ready to communicate: a
pocket-size English/Spanish dictionary can come in handy.
Get ready for adventure: do not
forget to pack a pair of comfortable shoes for every occasion and place
(sneakers, hiking boots, sandals, etc). Also, comfortable, loose clothes will
allow you to climb. Sunscreen is a must! Even in a cloudy day you may burn in
the sun. You are encouraged to wear it. Insect repellent, sunglasses, a hat,
and a rain jacket can also be useful.
Can you own a beach front land in Costa Rica?
Dreaming of purchasing a Costa Rica beachfront property where your
backyard is the ocean is close to impossible to find. Most of the beachfront
property is actually concession land, which means it is in the public domain
and not available for private ownership. In Costa Rica, concession properties
are generally avoided because they don’t grant the ownership rights. Taking
possession of these properties is the equivalent of a long-term lease.
95% of the beachfront property is concession and governed by maritime
zone law. The first 50 meters of beachfront are held under public domain, and
the next 150 meters of land are held under concession. The buyer may use the
land for a number of years. Generally, concession land is far less money
because of their complicated status. When you purchase concession property,
than you are agreeing to the fact the government maintains the right to seize
the property if it is needed.
If you decide to go ahead and purchase a concession property, consult
with an attorney to make sure the seller has the rights to occupancy, and is in
fact in a position to offer you the rights to the land. The land use rights can
range anywhere from 5 to 40 years. Most concession properties offer 20-year
occupancy rights. If you’re a die hard beach lover with your heart set on
having the ocean as your backyard you may take the risk. Be clear that you are
essentially signing a long term lease on the land not purchasing the property.
What is the time zone in Costa Rica?
Costa Rica does not observe daylight savings time. For citizens of
the U.S. and Canada, countries that do observe daylight Savings time, the time
zones vary between Mountain and Central time.
Are there any restrictions on bringing pets into the country of Costa
Rica?
If you want to bring your dog or cat, you will need to get in touch with
the Consulate of Costa Rica in your country. Bring a health certificate from a
licensed veterinarian, plus all vaccination given to your pet. These
certifications include:
- The
dog/cat was examined and found to be healthy and free of any clinical
signs of infectious disease. Note: In general this examination should be
conducted within 2 weeks of the departure date.
- Dogs
vaccinated against distemper, hepatitis, Leptospirosis, parvovirus and
rabies.
- Cats
vaccinated against rabies.
Forms:
- It is
recommended that a State or Federal (VS Form 18-1), U.S. Interstate and
International Certificate for Small Animals be used.
- The
accompanying health certificate should be made out at teats in duplicate.
- The health
certificate does NOT need to be notarized by a Notary Public, nor does it
need to be stamped by the Costa Rican Consular office.
- Animals exported
in commercial lot numbers must be accompanied by an import permit.
Personal pet dogs or cats do need an Import permit.
- The rabies
vaccination certificate should accompany the health documents.
Once you have all these papers, the Consulate of Costa Rica will process
and stamp all of these documents and your pet to come into the country.
For more information on real estate and rentals in Costa Rica, click here. Or, you
can contact us at:
Papagayo Realty
Office: (506) 2670-2002
