Buying Property in Costa Rica
Costa Rica is one of the most foreigner-friendly property markets in Latin America. Foreigners enjoy the same ownership rights as citizens for titled (fee simple) land. However, the process requires careful due diligence, a qualified Costa Rican attorney, and an understanding of important restrictions — particularly along the coastline.
Can foreigners own property in Costa Rica?
Yes — foreigners have exactly the same property rights as Costa Rican citizens for titled (fee simple / escritura pública) land. You do not need residency to purchase property. A foreign individual, a Costa Rican corporation (SA or SRL), or a foreign corporation registered in Costa Rica can all legally hold property title. The one major exception is concession land within the maritime zone — the 200-meter strip along the coast — which cannot be owned freehold by anyone (see below).
The Buying Process
- 1
Offer Letter (Carta de Intención)
Once you've found a property, the buyer typically submits a written offer letter outlining the purchase price and key terms. This is not legally binding in the same way as a US real estate contract, but it signals intent and often includes a small good-faith deposit (earnest money) of $1,000–$5,000 to take the property off the market while due diligence proceeds.
- 2
Hire a Costa Rican Attorney (Abogado/Notario)
This is not optional — it is essential. Only a licensed Costa Rican attorney can legally transfer property title. Your attorney handles due diligence, drafts the purchase agreement, and registers the deed at the Registro Nacional. Use your own attorney, not one recommended by the seller or agent. Membership in the Colegio de Abogados is the baseline requirement.
- 3
Due Diligence
Before signing any purchase agreement, your attorney conducts thorough due diligence. This includes: a title search (estudio de títulos) at the Registro Nacional to verify clean title and ownership chain; a cadastral survey (plano catastrado) to verify boundaries; checking for liens, mortgages, or annotations (anotaciones) on the title; confirming property tax (impuesto sobre bienes inmuebles) payments are current; and verifying there are no municipal fees or service debts attached to the property.
- 4
Purchase-Sale Agreement (Promesa de Compraventa)
A formal purchase-sale agreement is signed by both parties, setting out the agreed price, payment terms, and closing date. A deposit of 10–20% of the purchase price is standard at this stage. The agreement is typically drafted by the buyer's attorney.
- 5
Closing at the Registro Nacional
At closing, the deed (escritura pública) is signed before a Costa Rican notary (who is also an attorney). The deed is then submitted to the Registro Nacional (National Registry) for inscription. The buyer pays transfer taxes and legal fees at this stage. The process from contract to closing typically takes 30–90 days.
- 6
Registration
Once inscribed at the Registro Nacional, you are the legal owner of record. The registration process takes 2–6 weeks from submission. You will receive a folio real (property registration number) confirming ownership.
Due Diligence Checklist
Do Not Skip Due Diligence
Property fraud and title problems are real risks in Costa Rica. Purchasing a property with an encumbered title, unresolved liens, or boundary disputes can result in losing your investment. A qualified attorney conducting proper due diligence is the most important investment you will make in the purchase process.
Coastal Zone (Zona Marítimo Terrestre)
Zona Marítimo Terrestre — Cannot Be Owned Freehold
Under Costa Rican law (Law 6043), the first 200 meters from the high tide line along the ocean is the Zona Marítimo Terrestre (ZMT). This land belongs to the Costa Rican state and cannot be privately owned by anyone — citizen or foreigner. There is no such thing as "beachfront freehold title" in this zone.
The first 50 meters from the high tide line is the Public Zone (Zona Pública) — completely restricted, no construction permitted. The next 150 meters is the Restricted Zone (Zona Restringida) — development is permitted only through a government concession (concesión), not ownership.
How Coastal Concessions Work
Properties in the Restricted Zone operate on government concession agreements granted by the municipality (Municipalidad) with approval from ICT (Instituto Costarricense de Turismo). Key facts:
- Concessions are granted for fixed terms (typically 5–20 years) and can be renewed
- Foreigners who have not held legal residency for at least 5 years cannot hold a concession in their personal name — they must use a Costa Rican corporation with at least 50% Costa Rican ownership, or have a qualified Costa Rican co-holder
- Concessions can be bought and sold, but you are buying the concession rights, not title to the land
- Concession fees (canon) are paid annually to the municipality
- A concession can theoretically be revoked — though this is rare if canon is paid and terms are met
- Always verify the exact meter line location before buying near the coast — a surveyor and attorney are essential
Buy Titled Land Beyond the ZMT
Many popular coastal areas have titled (fee simple) properties that sit just beyond the 200-meter ZMT line. These can be owned outright as freehold property. Your attorney must verify the exact boundary measurements using an official survey. Properties described as "beachfront" often sit just outside the ZMT — confirm this in writing with a registered topographer's survey.
Costs of Buying Property
In addition to the purchase price, budget approximately 3–5% of the purchase price for transaction costs.
| Cost | Rate / Amount | Notes |
|---|---|---|
| Transfer Tax (Impuesto de Traspaso) | 1.5% of purchase price | Paid at closing to the Gobierno Central |
| Legal Fees (Honorarios de Abogado) | 1–2% of purchase price | Includes notary fees; typically charged by the buyer's attorney |
| Stamps & Registration Fees | ~0.5–1% of purchase price | Timbre Fiscal, Timbre de Registro Nacional, Timbre de Educación |
| Property Survey (Topografía) | $500–$2,000 | Varies with property size and complexity; essential for coastal/rural land |
| Property Inspection | $300–$800 | Structural and condition inspection; not legally required but strongly recommended |
| Real Estate Agent Commission | 4–6% (typically seller pays) | Usually paid by the seller; confirm who pays in the purchase agreement |
Sample Closing Costs — $250,000 Property
Currency: USDOngoing Property Taxes
Annual Property Tax (Bienes Inmuebles)
The annual property tax rate is 0.25% of the registered property value — one of the lowest in the world. Paid quarterly to the Municipalidad. Property is revalued periodically, and owners can self-declare a value.
On a $300,000 property: approximately $750/year ($187.50/quarter).
Luxury Home Tax (Impuesto Solidario)
An additional tax applies to residential properties with a construction value above a threshold (adjusted periodically — approximately ¢133 million colones / ~$265,000 USD in recent years). Rates are progressive from 0.25% to 0.55% on the construction value above the threshold.
Affects mid-range and higher-end homes. Your attorney or accountant can advise on whether your property will trigger this tax.
Financing a Purchase
Cash Purchases Are Most Common
The majority of foreign buyers pay cash for property in Costa Rica. This is partly because local bank financing for non-residents is difficult, and partly because sellers and agents in the expat market expect and often prefer cash transactions. Paying cash also typically allows for stronger price negotiation.
Local Bank Financing
Costa Rican banks (BAC Credomatic, Banco Nacional, BCR, Scotiabank) do offer mortgages, but typically require legal residency, a local credit history, and substantial documentation. Interest rates are higher than in the US or Europe (8–14% in colones; 6–10% in USD as of recent years). Loan-to-value ratios are typically 70–80% maximum.
Seller Financing
Some sellers offer owner financing, particularly on properties that have been on the market for a while. Terms are negotiable but typically involve 30–50% down, 3–5 year term, and interest rates of 6–10% USD. This can work well for both parties when bank financing is impractical.
Home Equity / International Financing
Some buyers leverage equity from property in their home country to fund a Costa Rica purchase. International lenders typically do not accept Costa Rican property as collateral, so you'd be borrowing against home-country assets. This is worth exploring with your bank or financial advisor before travel.
Developer Financing
Some new development projects (condos, residential communities) offer in-house financing directly from the developer. This can be more flexible than bank financing but requires careful review of terms and the developer's financial standing. Always have your attorney review developer contracts thoroughly.
HOAs and Condominiums
Gated communities (condominios or urbanizaciones) and condominium developments are common in expat areas. These are governed by HOA-style regulations under the Ley Reguladora de la Propiedad en Condominio. Before purchasing, obtain and review:
- The condominium regulations (reglamento de condominio)
- Current and historic monthly HOA fees (cuota de mantenimiento)
- The building's reserve fund balance — inadequate reserves are a red flag
- Any pending special assessments
- Meeting minutes from the last 1–2 years of HOA meetings
- History of fee increases
Monthly HOA fees in well-managed Escazú or Santa Ana communities typically range from $200–$500/month for condos and $150–$400/month for gated house communities, depending on amenities (pool, gym, 24-hour security).
Popular Areas for Expat Buyers
These areas have the most active expat buyer markets and the best support infrastructure for foreign property owners.
Escazú
Central ValleyThe most established expat enclave in Costa Rica, located just west of San José. Escazú has everything from international schools and private hospitals (CIMA) to high-end malls, chain restaurants, and gated communities. It's the easiest soft-landing for new arrivals but comes at a price.
Grecia
Central Valley (highlands)A small highland town northwest of San José, consistently rated one of the best places to retire in the world. Grecia offers a genuinely Tico small-town atmosphere, excellent weather (cooler at elevation), affordable living, and a growing but not overwhelming expat community. Famous for its red metal church.
Atenas
Central Valley (western highlands)A small town between San José and the Pacific coast, famously cited by National Geographic as having one of the best climates in the world. Atenas has a well-developed retirement community with a distinct small-town charm. Lower cost of living and easy Pacific coast access.
Manuel Antonio / Quepos
Central PacificManuel Antonio is Costa Rica's most famous beach park area, drawing a large LGBTQ+ community, retirees, and digital nomads alongside tourists. Quepos is the nearby service town. The combination offers natural beauty and reasonable amenities, though prices are inflated by tourism.
Tamarindo
Guanacaste (North Pacific)The most developed beach town in Guanacaste, Tamarindo is a surf town turned expat hub with strong American and European communities. The dry season (Nov–May) makes it one of the most accessible beach destinations. Infrastructure is solid relative to other coastal towns.
Uvita / Ojochal
Southern Pacific (Ballena Coast)Two neighboring communities on the lush Southern Pacific coast. Uvita is a small service town near the Whale Tail beach at Marino Ballena National Park; Ojochal is a nearby expat village famous for its surprisingly diverse international restaurant scene. This area is known for its pristine natural environment and quieter lifestyle.
Nosara / Sámara
Guanacaste (Nicoya Peninsula)Two of the most beloved expat beach communities in Costa Rica, separated by about 35km on the Nicoya Peninsula. Nosara is a yoga/wellness hub with strict development restrictions protecting its natural character; Sámara is slightly more developed and family-friendly with a calmer bay. Both attract long-term expats seeking a genuine surf and nature lifestyle.
Nuevo Arenal
Northern Zone (Arenal Lakeside)A small lakeside town on the shores of Lago Arenal, popular with retirees seeking an affordable, scenic, and genuinely tranquil lifestyle. The drive around the lake is spectacular. Nuevo Arenal has a small but tight-knit expat community and a surprisingly good selection of amenities for its size.
Property Management for Absentee Owners
If you're purchasing a property but not living in it full-time, engaging a local property manager is essential. Costa Rica's tropical climate means properties deteriorate quickly without regular maintenance — mold, vegetation growth, and opportunistic break-ins are real risks for unattended homes.
Property management services typically include: regular inspections, maintenance coordination, bill payment (utilities, property tax, HOA), rental management if you want to generate income, and serving as your local contact for any issues. Fees typically run 8–15% of rental income for vacation rental management, or $150–$400/month for caretaker services without rental management.
For beach properties, look for managers with specific experience in the local area. In expat-heavy areas like Escazú, Atenas, Tamarindo, and Manuel Antonio, there are established property management companies with English-speaking staff.
Always Use Your Own Attorney
Never use an attorney or notary recommended by the seller, real estate agent, or developer. While most professionals are honest, the incentive structures are misaligned — you need an attorney whose only client in the transaction is you. Budget $1,500–$4,000 for legal services on a typical residential purchase. It is money well spent.