Buying Property in Costa Rica

Buying Property in a foreign country can be a scary undertaking yet the climate is so inviting especially during our very cold winter season. Fortunately it has been possible to buy property in Costa Rica with a higher degree of assurance than other foreign countries.

Your Realtor, whomever you select, should be able to help you locate property matching your criteria of selection and educate you about Costa Rica in general. He should also inform you about property values and other factors in your area of choice. Lastly, but definitely not the least, he should assist you in negotiating a fair price and good financing as well.

You should also use a lawyer with a good reputation or Certified Notary Public, who can handle the financial aspects of the transaction and ensure you will have legal title to your property.

Ownership of Costa Rican Property

You can purchase real estate as you normally would at home in your own name. Quite often it makes more sense to purchase through an existing or new corporation entity and this is very common in Costa Rica as there are numerous benefits associated with this. It is not a complicated or expensive procedure but does require the expertise of a lawyer.

The Public Registry of Properties

All property should be registered in the Public Registry of Properties, whether the property is fee simple or concession. Your lawyer will be able to confirm that the seller does in fact own the property you intend to purchase and will determine if there are any restrictions on this property. He should then, after verification of these matters, be in a position to provide you with a “clear and marketable” title to your chosen property.

Folio Real Numbers and Cadastrals

Each property has a unique number and this number is comprised of three parts. The first number segment denotes the province; the second segment is the number of the property itself and the third is the number of owners the property currently has. Any property that does not have these Folio Real Numbers should be suspect.

Each registered property also has a survey plan and in order to transfer, mortgage or acquire a property this plan must be registered at the Public Registry of Properties.

Property Taxes

Property taxes in Costa Rica are very low. They are 1/4 of 1% of the registered property value. Thus for a property whose registered value is $100,000 usd the tax would be $250.00 per year.

Closing Costs

These costs are fairly standard and are usually split between Buyer and Seller. They include: (1) Real Estate Transfer Tax, which is 1.5% of the registered value of the property as stated on the deed; (2) Documentary Stamps, which total approximately 1.25% of the registered value; and lastly (3) The Notary Fee, which is 1.5% of the first million colones and 1.25 % on the balance of the property sales price.


If you require financing, some banks such as ScotiaBank in Costa Rica will finance 40-50% of the Purchase Price or Appraised Value (whichever is less). Interest rates shall be 9-14% (as at August 2004). This presupposes that the applicant has an impeccable credit rating. From this we can easily see that it is usually much more advantageous and simpler to arrange your mortgaging at home where interest rates are generally lower!

There are however certain projects and/or private sellers that may offer some financing. Your realtor should be able to inform you of such projects.

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