Basic steps to buy property in Costa Rica as a foreigner

Where to start, guide and advantages to start your life change

Buying property in Costa Rica is a safe and relatively simple process even for non-residents. Thanks to favorable laws for foreigners and the expanding real estate market, more and more people are choosing to invest in this tropical paradise. However, to ensure a smooth transaction, it's crucial to know local regulations and follow a few key procedures. Here's a practical guide to help you navigate the process of buying real estate in Costa Rica.

Basic steps to buy property in Costa Rica as a foreigner

The laws for the purchase of real estate by foreigners

In Costa Rica, foreigners enjoy almost the same rights as citizens when it comes to buying property. According to the Constitution, there are no special restrictions for non-residents, who can own 100% of a property, either as individuals or through companies. This makes the country one of the favorite destinations for those looking for seaside homes for sale in Costa Rica or other investment properties.
However, there are exceptions in coastal areas. The Maritime-Terrestrial Zone includes the first 200 meters from the tidal line. The first 50 meters are in the public domain, while the remaining 150 meters can be granted in usufruct, but not sold. In these areas, foreigners can obtain concessions, but it's crucial to follow local regulations carefully and work with an attorney experienced in real estate law.

Practical guide for navigating the legal and bureaucratic process

1. Preliminary research and legal assistance. It is essential to have a lawyer specialized in real estate law in Costa Rica. Your attorney will verify the property titles in the National Register, check that there are no pending mortgages or litigation, and will ensure that the purchase is legitimate and secure.
2. Creation of a company. Many foreigners prefer to buy property through a limited liability company (Sociedad Anónima or S.A.). This approach offers tax advantages and facilitates asset management, especially for succession. A lawyer can assist you in setting up the company, which requires a registration with the Register of Legal Entities.
3. Signing of the preliminary contract. After choosing the property, we proceed with the signing of a preliminary contract. This document defines the details of the sale, such as the price, payment methods and finalization times. A deposit of 10-20% of the value of the property is usually required. Your lawyer will be responsible for verifying that the contract complies with local laws.
4. Due diligence. Legal due diligence is a crucial step in making sure there are no legal constraints on the property. Your lawyer will carry out extensive research to verify the regularity of the securities and confirm that there are no bureaucratic obstacles or debts related to the property.
5. Public act and registration. Once the due diligence has been completed, the purchase is finalized through a public act before a notary. In Costa Rica, notaries are also lawyers with powers of registration, and will be responsible for registering the transaction in the National Registry. After registration, you will officially become the owner of the property. Payment of taxes Foreigners who own property in Costa Rica must comply with local tax regulations. The main taxes include real estate tax, which ranges from 0.25% to 0.55% of the registered value of the property, and luxury real estate tax, if applicable. In addition, income from renting the property is subject to income tax.

Advantages of investing in real estate in Costa Rica

Investing in real estate in Costa Rica offers significant advantages, not only because of the simplicity of the process, but also because of the increasing value of the properties. Beachfront homes for sale in Guanacaste, one of the most popular regions among international buyers, are a lucrative investment opportunity thanks to increased tourist demand and constant infrastructure development.
Many investors choose to buy properties to rent during the high tourist season, generating income guaranteed by leases. In addition, the possibility of buying real estate through a company facilitates asset management and offers additional tax advantages.

Buying property in Costa Rica as a foreigner is a secure and well-regulated process. By following the right procedures and relying on qualified professionals, you can make a solid investment in one of the most welcoming countries for international investors. With the support of an experienced attorney and a clear understanding of local laws, you'll be able to enjoy a hassle-free transaction and obtain property in one of the world's most desired destinations.

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