Complete Guide to Buying Property in Costa Rica as a Foreigner

Introduction

Costa Rica's property market offers a vibrant and diverse array of opportunities for foreign buyers. From lush beach homes to serene mountain retreats, the country is increasingly becoming a favorite destination for expatriates and investors. Understanding the landscape of real estate in Costa Rica is essential for making informed decisions. This guide provides a comprehensive overview for foreigners considering purchasing property in this beautiful Central American paradise.

Can Foreigners Buy Property?

Yes, foreigners can buy property in Costa Rica without restrictions. The law permits non-nationals to acquire both residential and commercial properties. However, it is important to note:

• Foreigners cannot own land within 50 meters of the high water mark of the Pacific or Caribbean coasts unless they establish a corporation.
• Use of legal entities, such as corporations, is common and usually recommended for purchasing beachfront properties.

The Buying Process

The buying process in Costa Rica involves several essential steps:

1. Find a Property: Use local real estate agents or platforms to discover listings.
2. Make an Offer: Submit an offer in writing, typically through your real estate agent.
3. Signing a Purchase Agreement: Once an offer is accepted, conduct due diligence and sign a purchase agreement.
4. Secure Financing: If not paying cash, work with banks that cater to foreigners.
5. Closing: Coordinate with a lawyer and a notary to finalize the sale, ensuring all legal requirements are met.

Costs and Taxes

Be aware of the associated costs when purchasing property:

• Transfer Tax: Usually 1.5% of the property value.
• Notary Fees: Fees typically range from 1% to 2% of the property value depending on the complexity of the transaction.
• Real Estate Agent Fees: Generally 5% of the sale price.

Legal Requirements

Several legal requirements must be fulfilled:

• NIE/Tax Number: Obtain a Número de Identificación de Extranjero from the tax authority.
• Lawyer: Engage a local lawyer with experience in property transactions for guidance.
• Notary: Use a notary public who specializes in real estate to finalize your purchase.

Due Diligence

Perform thorough due diligence before completing a purchase:

• Check the property title for any liens or encumbrances.
• Review zoning regulations and usage rights.
• Inspect the property and surrounding infrastructure.
• Confirm utility access and service connections.

Common Pitfalls

Foreign buyers should be cautious of the following mistakes:

• Skipping the due diligence process may lead to unexpected liabilities.
• Relying solely on verbal promises without written agreements.
• Not consulting with a lawyer, which can result in legal complications.
• Overlooking ongoing costs, such as property taxes and HOA fees.

Tips for Success

Consider these tips for a successful property purchase:

• Engage reputable local real estate agents and legal advisors.
• Visit multiple properties and neighborhoods before making a decision.
• Understand the resale value and market trends of the area.
• Be prepared for the cultural differences and negotiation practices.

Conclusion

Purchasing property in Costa Rica as a foreigner can be an exciting investment opportunity with the right knowledge and guidance. Ensure you are well-versed in the legal requirements, careful in your due diligence, and avoid common pitfalls. For personalized assistance, start your property search with Casza, where you can explore a range of listings tailored to your needs.

Disclaimer: This guide is for informational purposes only. Always seek professional legal advice tailored to your specific circumstances.