How are Americans buying property in Costa Rica?

Authored by the expert who managed and guided the team behind the Costa Rica Property Pack

Everything you need to know before buying real estate is included in our Costa Rica Property Pack

Who is the author of this content?

THELATINVESTOR

A team specialized in real estate investing in Latin American countries (Costa Rica, Mexico, Colombia, Panama, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Costa Rica. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At TheLatinInvestor, we explore the Costa Rican real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like San José, Manuel Antonio, and Tamarindo. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

Are there any restrictions on what types of property Americans can buy in Costa Rica compared with Costa Rican citizens or buyers from other countries?

Americans enjoy nearly identical property ownership rights as Costa Rican citizens throughout most of the country.

The primary restriction affects the Maritime Zone (Zona Marítimo Terrestre), which comprises Costa Rica's coastal areas. In the first 50 meters from the high tide line, no one can own property as this remains public land. In the next 150 meters inland, foreigners can only own up to 49% of a property through a corporation, often requiring a Costa Rican partner or nominee.

Outside the Maritime Zone, Americans can purchase property with full fee simple ownership rights. This includes condominiums, single-family homes, commercial buildings, and undeveloped land in inland areas and most beach communities with titled property. There are no restrictions on the number of properties an American can own, the property value, or the intended use whether for personal residence, vacation home, or investment rental.

It's something we develop in our Costa Rica property pack.

The key distinction lies between titled property (which offers full ownership rights) and concession property in coastal zones where ownership is limited and requires annual fees to the municipality.

What residency or visa options allow Americans to own property long-term, and how do I qualify for each?

Property ownership in Costa Rica does not require residency, but several visa options can provide long-term legal status.

The Investor Residency (Inversionista) requires a minimum $150,000 investment in Costa Rican real estate or business. This visa grants temporary residency for two years, renewable if the investment is maintained, and leads to permanent residency after three years of continuous temporary status. Applicants must provide police clearances, health insurance, and proof of the investment through bank statements and property registration.

The Rentista Residency requires $60,000 deposited in a Costa Rican bank plus proof of $2,500 monthly passive income from sources like pensions, annuities, or rental income. This two-year renewable visa allows multiple entries and the ability to work with proper permits.

The Pensionado Residency is ideal for retirees with guaranteed monthly pension income of at least $1,000 from government or private sources. Documentation includes pension letters, apostilled birth certificates, criminal background checks, and health insurance coverage.

All residency applications require health insurance that covers Costa Rica, background checks from your home country and any country where you've lived for more than two years, and income verification through bank statements and official documentation.

Do I need to be physically present in Costa Rica at any point during the purchase, or can I handle everything remotely with a power of attorney?

You can complete an entire property purchase remotely without setting foot in Costa Rica.

The process requires executing a "Poder Generalísimo" (General Power of Attorney) that grants your chosen attorney or agent the authority to sign documents, transfer funds, and register the property on your behalf. This POA must be executed either at a Costa Rican consulate in the United States or through a local notary, then apostilled for international recognition.

Your attorney will conduct all due diligence remotely, including title searches at the National Registry, property surveys verification, lien checks, and environmental assessments. Funds are typically transferred through secure escrow accounts managed by established law firms or title companies.

The closing process involves your attorney signing the transfer deed (Escritura de Traspaso) on your behalf and registering the property at the National Registry. You'll receive copies of all signed documents electronically, and the original property deed can be held by your attorney or shipped to you after registration.

Many American buyers never visit their Costa Rican property until after they own it, relying entirely on virtual tours, local inspections by their attorney, and detailed property reports.

What are the exact steps and documents an American needs to complete a property purchase from start to finish?

The Costa Rican property purchase process follows a structured timeline typically lasting 30-60 days.

Step	Timeline	Required Documents
Initial Offer & Deposit	Day 1-3	Letter of Intent, 10% earnest money, passport copy
Due Diligence Period	Days 4-30	Title search, Plano Catastrado survey, utility certificates
Purchase Agreement	Days 31-35	Signed contract, additional deposit (typically 10-20%)
Final Inspection	Days 36-45	Property inspection report, final walk-through
Closing Preparation	Days 46-50	Escritura de Traspaso preparation, tax certificates
Closing & Registration	Days 51-60	Fund transfer, deed signing, National Registry filing
Post-Closing	Days 61+	Property tax setup, utility transfers, insurance

Essential documents include your passport, Power of Attorney (if buying remotely), proof of funds through bank statements, the property's Plano Catastrado (official survey map), current tax certificates showing no outstanding debts, and environmental compliance certificates for properties over certain sizes.

Your attorney will verify the chain of title, confirm the property boundaries match the survey, check for liens or encumbrances, and ensure all municipal taxes are current before proceeding to closing.

Is hiring a Costa Rican attorney mandatory for American buyers, and if so, how do I choose one and what should I budget?

Hiring a Costa Rican attorney is mandatory by law for all real estate transactions involving property registration.

Costa Rican law requires a notario público (attorney-notary) to handle property transfers and registration at the National Registry. This professional must be a licensed Costa Rican attorney with notary powers, and they bear legal responsibility for verifying all aspects of the transaction.

Attorney fees are regulated by the Costa Rican Bar Association at 1.25-1.5% of the purchase price, with a minimum fee regardless of property value. For a $300,000 property, expect to pay $3,750-$4,500 in legal fees. Additional costs may include translation services, courier fees for document delivery, and specific searches or certifications.

Choose bilingual attorneys experienced with foreign buyers and familiar with international banking procedures. Reputable firms include Outlier Legal, LandCo, and SaumaRossi, which specialize in American clients. Verify their credentials with the Costa Rican Bar Association and request references from recent American buyers.

Your attorney should provide a detailed fee schedule upfront, maintain client escrow accounts for fund transfers, carry professional liability insurance, and offer post-closing support for property tax setup and ongoing legal needs.

Can Americans obtain mortgages from Costa Rican banks, and what typical interest rates, terms, and down-payment requirements should I expect?

Costa Rican banks offer mortgages to Americans, but with stricter requirements than U.S. lenders.

Local banks typically require 30-50% down payments with interest rates ranging from 8.5-10% annually for 15-20 year terms. The application process demands extensive documentation including proof of income for the past two years, tax returns, bank statements, employment verification, and all documents translated into Spanish by certified translators.

Major banks like Banco Nacional, BAC Credomatic, and Banco de Costa Rica offer foreigner mortgage programs, but approval rates are significantly lower than for residents. Banks prefer applicants with Costa Rican residency, local employment, or substantial assets in the country.

Monthly debt-to-income ratios cannot exceed 30-35% of gross income, and banks often require borrowers to maintain accounts with them for at least six months before loan approval. Processing times typically range from 60-90 days, considerably longer than U.S. mortgage approvals.

Alternative financing options often prove more practical for American buyers, including U.S.-based portfolio loans, home equity lines of credit, or seller financing arrangements that are common in the Costa Rican market.

What strategies can help an American borrower improve the odds of getting approved for local financing or better rates?

Several strategies can significantly improve your chances of securing favorable Costa Rican financing.

1. **Establish Local Banking Relationships**: Open accounts with Costa Rican banks 6-12 months before applying for a mortgage. Maintain substantial balances and demonstrate consistent banking activity to build creditworthiness within the local system.2. **Obtain Costa Rican Residency**: Even temporary residency dramatically improves loan approval odds and may qualify you for better interest rates typically reserved for residents.3. **Partner with Local Co-signers**: Having a Costa Rican citizen or resident co-sign the loan can overcome many foreigner restrictions, though this requires careful legal documentation of responsibilities.4. **Consider Alternative Lenders**: International banks like Scotia Bank and private lenders like Second Street Capital offer specialized programs for American buyers with more flexible requirements than traditional Costa Rican banks.5. **Leverage U.S. Assets**: Use American real estate as collateral for portfolio loans or home equity lines of credit, which often offer better rates and terms than Costa Rican mortgages.

It's something we develop in our Costa Rica property pack.

Seller financing remains highly popular in Costa Rica, with many property owners offering 1-3 year terms at 6-9% interest with 50% down payments, providing time to establish local credit or arrange alternative financing.

What taxes and ongoing fiscal obligations will I face as an American property owner in Costa Rica, both locally and back in the U.S.?

Costa Rican property ownership involves several tax obligations both locally and for U.S. tax reporting.

Local taxes include annual property tax of 0.25% of the registered property value paid to the municipality, transfer tax of 1.5% of the purchase price paid at closing, and potential capital gains tax of 15% on profits if the property is sold within 5-10 years depending on use as primary residence.

Municipal services like garbage collection, water, and electricity are billed separately. Luxury home tax applies to properties valued over $200,000 with rates increasing based on value. Condominium owners pay monthly HOA fees ranging from $50-500 depending on amenities and services.

U.S. tax obligations require reporting foreign property ownership on Form 8938 if total foreign assets exceed $200,000 for overseas residents or $50,000 for U.S. residents. FBAR filing is mandatory if your foreign bank accounts exceed $10,000 at any point during the year. Rental income must be reported on U.S. tax returns with foreign tax credits available for Costa Rican taxes paid.

Primary residence exemptions may apply to Costa Rican capital gains tax if you live in the property for at least two years. Professional tax advice is essential given the complexity of dual-country tax obligations and potential treaty benefits.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Costa Rica versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

Which parts of Costa Rica do Americans most often choose to settle in, and why?

American expats concentrate in specific regions that offer established infrastructure, healthcare access, and existing expat communities.

Guanacaste Province, particularly around Tamarindo, Papagayo, and Playas del Coco, attracts Americans seeking beach lifestyle with modern amenities. This region offers international airport access, established real estate markets, and strong rental demand from tourism. The dry season climate and Pacific coastline appeal to Americans familiar with California or Arizona conditions.

The Central Valley, including Escazú, Santa Ana, and Heredia, draws Americans prioritizing urban conveniences, healthcare access, and cooler mountain climate. These areas offer international schools, modern shopping centers, proximity to San José's amenities, and reliable infrastructure including high-speed internet essential for remote workers.

The South Pacific region around Uvita, Dominical, and Ojochal attracts eco-conscious Americans seeking lower cost of living and pristine natural environments. This area offers excellent value for money, growing expat communities, and access to Manuel Antonio National Park and whale watching opportunities.

Americans also favor established communities like Atenas for its proclaimed "best climate in the world," Monteverde for eco-tourism opportunities, and beach towns like Jacó for its proximity to San José and developed tourism infrastructure.

Using the latest livability data, rental yields, tourism figures, and growth forecasts, which regions offer the best prospects for living, renting out, or capital appreciation right now?

As of mid-2025, several Costa Rican regions show exceptional promise for different investment and lifestyle goals.

Region	Rental Yield	Appreciation Forecast	Best For
Guanacaste (Tamarindo)	8-12%	6-8% annually	Vacation rentals, tourism investment
Central Valley (Escazú)	5-7%	4-6% annually	Long-term living, stable rental income
South Pacific (Uvita)	7-10%	7-9% annually	Eco-tourism, value appreciation
Caribbean Coast (Puerto Viejo)	6-9%	5-7% annually	Alternative tourism, lower entry costs
Manuel Antonio	9-13%	6-8% annually	Premium vacation rentals

Tourism recovery has exceeded 2019 levels, with international arrivals reaching 3.2 million visitors in 2024. The government's tourism infrastructure investments, including improved highways and airport expansions, support continued growth in beach destinations.

Remote work trends benefit Central Valley properties with reliable internet and international amenities. Rental yields of 7.8% nationally exceed many developed markets, with beach properties commanding premium rates during peak seasons from December through April.

It's something we develop in our Costa Rica property pack.

What is the current price range for popular cities and coastal regions, broken down by square-meter or typical home size?

Costa Rican real estate prices vary dramatically between regions and property types as of June 2025.

In Guanacaste beach towns, oceanfront condominiums range from $3,500-6,000 per square meter, while single-family beach houses cost $2,500-4,500 per square meter. Typical 2-bedroom condos sell for $300,000-600,000, and 3-bedroom houses range from $500,000-1,200,000 depending on ocean proximity and amenities.

Central Valley properties offer better value with condominiums priced at $1,500-3,000 per square meter and houses at $1,200-2,500 per square meter. Standard 3-bedroom homes in Escazú or Santa Ana cost $250,000-500,000, while luxury properties reach $800,000-1,500,000.

South Pacific regions like Uvita and Dominical show prices of $1,800-3,200 per square meter for beachfront properties and $800-1,800 per square meter for inland homes. Typical properties range from $200,000-450,000 for houses and $150,000-350,000 for condominiums.

Raw land prices vary from $50-200 per square meter in developing areas to $500-1,500 per square meter for prime beachfront lots. Construction costs typically add $800-1,200 per square meter for standard finishes and $1,200-2,000 per square meter for luxury specifications.

What common mistakes and pitfalls do American buyers run into, and how can I avoid them?

American property buyers frequently encounter predictable pitfalls that can be easily avoided with proper preparation.

1. **Maritime Zone Confusion**: Many Americans unknowingly purchase concession properties thinking they have full ownership. Always verify whether property is in the Maritime Zone and understand that concession properties require annual municipality fees and have ownership restrictions.2. **Insufficient Due Diligence**: Rushing the purchase without proper title verification, survey confirmation, and lien searches. Ensure your attorney conducts complete due diligence including water rights verification, zoning compliance, and environmental clearances.3. **Using Seller's Attorney**: Accepting the seller's recommendation for legal representation creates conflicts of interest. Always hire your own independent attorney experienced with American buyers and never share legal representation with the seller.4. **Underestimating Total Costs**: Budgeting only for the purchase price without accounting for closing costs, attorney fees, taxes, and ongoing expenses. Factor in 3-5% of purchase price for closing costs plus ongoing municipal taxes and maintenance.5. **Inadequate Property Management Planning**: Purchasing investment properties without established management systems for maintenance, rentals, and tenant relations. Research local property management companies and factor their 10-15% fees into rental income projections.

Currency exchange timing can significantly impact purchase costs, so consider forward contracts or currency hedging for large transactions. Verify all utilities are properly connected and functional, as some rural properties may lack reliable water, electricity, or internet access essential for modern living.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Nestmann International - Costa Rica Property Ownership Laws
2. TheLatinInvestor - Costa Rica Property Guide for Americans
3. Henley Global - Costa Rica Residency Investment
4. Living Costa Rica - Remote Property Purchase Guide
5. Costa Rica Real Estate - Purchase Process
6. Wise - Costa Rica Mortgage Guide
7. Robert Hall Taxes - Costa Rica Tax Guide
8. International Living - Living in Costa Rica