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Everything you need to know before buying real estate is included in our Costa Rica Property Pack
Foreign property ownership laws in Costa Rica are generally favorable to international buyers, allowing foreigners to own real estate with nearly the same rights as Costa Rican citizens.
Foreigners can legally purchase and own residential, commercial, and agricultural properties in Costa Rica with full fee simple ownership rights. However, certain restrictions apply in maritime zones, border areas, and protected regions. No residency or special visa is required to buy property, though investing $150,000 USD or more qualifies buyers for investor residency as of June 2025.
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Foreigners enjoy nearly identical property ownership rights as Costa Rican citizens, with full fee simple ownership allowed for most property types. The main exceptions are maritime zones where foreign ownership is limited to 49% in concession areas, and border regions within 50 kilometers of international boundaries.
| Aspect | Foreigners | Costa Ricans |
|---|---|---|
| Fee Simple Ownership | Yes, except restricted zones | Yes |
| Maritime Zone (First 50m) | Cannot own (public land) | Cannot own (public land) |
| Maritime Zone (Next 150m) | 49% maximum ownership | Can lease concession land |
| Border Areas | Restricted within 50km | No restrictions |
| Protected Areas | Restricted or prohibited | May have restrictions |
| Residency Required | No | No |
| Investor Residency Eligibility | $150,000+ investment | Citizen by birth |
Can foreigners legally buy property in Costa Rica, and are there any restrictions compared to locals?
Foreigners have complete legal rights to buy and own property in Costa Rica with the same privileges as Costa Rican citizens, including fee simple ownership.
The Costa Rican Constitution guarantees these property rights regardless of nationality, allowing foreigners to purchase residential, commercial, and agricultural properties without restrictions in most areas. This makes Costa Rica one of the most foreigner-friendly countries in Central America for real estate investment.
However, important exceptions exist in specific zones. The Maritime Zone (Zona Marítimo Terrestre) restricts foreign ownership, with the first 50 meters from the high tide line being public land that cannot be owned by anyone. The next 150 meters can only be held as government concessions, where foreigners are limited to 49% ownership. Border areas within 50 kilometers of international boundaries also face restrictions for foreign buyers.
Protected areas including national parks, river mouths, nature reserves, and certain islands may have special regulations that limit or prohibit foreign ownership. Always verify the property's legal status and exact location before proceeding with any purchase.
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Are there specific property types or land zones that foreigners are not allowed to purchase?
Foreigners face ownership restrictions in three main categories: maritime zones, border areas, and protected regions.
The Maritime Zone presents the most significant restrictions, where the first 50 meters from high tide are public land that cannot be owned by anyone, including Costa Ricans. The subsequent 150 meters are concession lands where foreigners can only hold up to 49% ownership, with the remainder requiring Costa Rican partners or corporations with majority local ownership.
Border areas within 50 kilometers of international boundaries with Nicaragua and Panama restrict foreign ownership as a national security measure. Properties in national parks, biological reserves, wildlife refuges, and forest reserves may also be off-limits or heavily regulated for foreign buyers.
Certain islands and river mouth areas face additional restrictions, and some agricultural lands in specific zones may require special permits or have foreign ownership limitations. Always conduct thorough due diligence to verify that your target property falls outside these restricted categories.
Do I need to have residency or a specific visa type to buy property in Costa Rica as a foreigner?
No specific visa or residency status is required to purchase property in Costa Rica as a foreigner.
Tourists can legally buy real estate while on a standard 90-day tourist visa, making the process accessible to international buyers without requiring long-term commitments or complex visa applications. This policy significantly simplifies the investment process compared to many other countries.
While property ownership doesn't automatically grant residency rights, investing at least $150,000 USD in real estate qualifies buyers for the "Inversionista" (Investor) Residency category as of June 2025. This residency status allows legal long-term residence in Costa Rica and can eventually lead to permanent residency.
The investor residency program requires maintaining the minimum investment amount and meeting other criteria such as proving the legal source of funds and passing background checks. This option appeals to buyers who want both property ownership and the ability to live in Costa Rica legally.
Is it mandatory to be physically present in Costa Rica to complete a real estate purchase, or can it be done remotely?
Physical presence is traditionally required at closing for both parties to sign transfer documents before a notary public.
However, foreigners can complete purchases remotely by appointing a trusted representative through a power of attorney. This power of attorney must be obtained at a Costa Rican consulate in your home country and properly authenticated for use in Costa Rica.
Most preliminary steps including property searches, negotiations, due diligence, and contract preparation can be conducted online through video calls, email, and digital document sharing. Modern technology allows buyers to view properties virtually, review legal documents electronically, and communicate directly with lawyers and real estate agents.
The appointed representative can handle the final closing, sign documents, transfer funds, and complete registration procedures on your behalf. This remote option provides flexibility for international buyers who cannot travel to Costa Rica for the closing process, though many buyers prefer to be present for such significant transactions.
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What is the step-by-step legal process for buying property in Costa Rica, and what documents are required?
The Costa Rican property purchase process follows a structured legal framework requiring specific documentation and procedures.
| Step | Process | Key Documents Required |
|---|---|---|
| 1. Property Selection | Identify property and negotiate initial terms | Property listing, preliminary agreement |
| 2. Due Diligence | Legal verification of title, boundaries, permits | Property title (Escritura), Cadastral plan |
| 3. Purchase Agreement | Sign formal contract with terms and conditions | Purchase contract, deposit receipt |
| 4. Document Preparation | Gather all required permits and certifications | SETENA environmental permit, municipal permits |
| 5. Closing Preparation | Secure funds and complete final paperwork | Proof of funds, origin of funds declaration |
| 6. Transfer Execution | Sign transfer deed before notary public | Transfer deed (Escritura), identification documents |
| 7. Registration | Register deed at Public Registry and pay taxes | Transfer tax payment, registration fees |
Essential documents include the property title (Escritura), Plano Catastrado (cadastral plan), SETENA environmental viability permit, municipal permits and licenses, current tax documentation, and proof of legal origin of funds. Your lawyer will verify each document's authenticity and ensure compliance with all legal requirements before proceeding with the transfer.
Do I need to hire a Costa Rican lawyer or notary to purchase property, and what should I look for when choosing one?
Hiring a qualified Costa Rican real estate attorney who is also a licensed notary public is mandatory for all property transactions.
Only licensed notaries can legally draft and record the transfer deed (escritura) that officially transfers property ownership. This dual role of attorney-notary is unique to Costa Rica's legal system and ensures that legal professionals handling real estate transactions meet strict qualification standards.
Choose a lawyer who specializes exclusively in real estate law and works independently from the seller, real estate agent, or developer to protect your interests. Look for attorneys with strong English language skills, extensive experience with foreign buyers, and positive references from previous international clients.
Verify the lawyer's credentials through the Costa Rican Bar Association (Colegio de Abogados) and ensure they carry professional liability insurance. A qualified attorney will provide transparent fee structures, detailed explanations of all procedures, and comprehensive due diligence reports to protect your investment.
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Are mortgages available to foreigners in Costa Rica, and what are the typical conditions, interest rates, and best tips to secure financing?
Mortgages are available to foreigners in Costa Rica but are uncommon due to strict requirements and bureaucratic complexity.
Local banks require 30-50% down payments, offer terms up to 20 years, and charge interest rates between 8.5% and 10% as of June 2025. Foreign applicants must provide translated and authenticated proof of income, credit history, employment verification, and detailed source of funds documentation.
Banks also require Costa Rican tax identification numbers, local bank accounts, and often prefer borrowers with some form of legal residency status. The approval process can take 3-6 months and involves extensive financial scrutiny and property appraisals by bank-approved valuators.
Alternative financing options include private lenders offering more flexible terms at higher interest rates (12-15%), seller financing arrangements, and developer financing programs. Many foreign buyers choose to purchase properties outright with cash to avoid the complexity and time requirements of traditional mortgage processes.
Best strategies include preparing all financial documentation in advance, working with bilingual attorneys familiar with banking procedures, considering seller financing negotiations, and maintaining substantial cash reserves for down payments and closing costs.
What are the taxes, legal fees, and other costs associated with buying, owning, and reselling property in Costa Rica?
Property transactions in Costa Rica involve multiple taxes and fees that buyers must factor into their investment calculations.
| Cost Category | Amount | Description |
|---|---|---|
| Transfer Tax | 1.5% of purchase price | Government tax on property transfers |
| Legal/Notary Fees | 1-1.5% of purchase price | Attorney and notary services |
| Property Survey | $500-$1,500 + 13% tax | Boundary verification and mapping |
| Property Inspection | $650-$1,000 + 13% tax | Structural and systems evaluation |
| Escrow Services | $400-$1,200 | Secure fund handling during transaction |
| Corporation Setup | $750-$1,500 | If purchasing through corporate entity |
| Annual Property Tax | 0.25% of registered value | Ongoing ownership obligation |
Additional ongoing costs include luxury home tax of 0.25-0.55% for high-value properties, capital gains tax of 15% on profitable sales, and various municipal fees for services and permits. Property owners must also budget for maintenance, insurance, security, and management costs depending on property type and location.
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 cities or regions in Costa Rica offer the best opportunities in terms of lifestyle, rental income, and capital appreciation?
Costa Rica's diverse regions offer distinct advantages for different investment strategies and lifestyle preferences.
- Tamarindo (Guanacaste Province): High short-term rental demand from tourists, proximity to Liberia International Airport, established infrastructure, and strong rental yields ranging from 8-12% annually.
- Jacó Beach (Central Pacific): Excellent rental occupancy rates, close proximity to San José, growing infrastructure development, and appeal to both tourists and locals.
- Uvita & Ojochal (Southern Zone): Tranquil settings focused on nature tourism, strong appreciation potential, emerging luxury market, and sustainable development trends.
- Escazú & Santa Ana (Central Valley): Modern amenities, high-end expatriate communities, strong long-term rental demand, and stable property values near the capital.
- Nosara (Nicoya Peninsula): Exclusive wellness-focused community, high rental yields, international airport accessibility, and premium property appreciation.
Regional investment performance varies significantly based on tourism patterns, infrastructure development, and market maturity. Coastal areas typically offer higher rental yields but require more maintenance, while Central Valley properties provide stability and steady appreciation with lower vacancy rates.
What are the current average property prices across major Costa Rican cities and regions, and how do they compare?
Property prices in Costa Rica vary dramatically by location, with coastal areas and the Central Valley commanding premium pricing as of June 2025.
San José city center properties average $1,110 per square meter for houses and up to $1,724 per square meter for condominiums. Alajuela properties range from $903-$1,598 per square meter, with luxury developments reaching $5,200 per square meter.
Rental markets show city center one-bedroom apartments averaging $501 per month, while three-bedroom units average $839 monthly. Coastal properties in popular tourist areas like Tamarindo and Jacó command significantly higher prices, often 50-100% above Central Valley averages.
Regional price variations reflect infrastructure quality, tourism demand, proximity to airports, and development restrictions. Beach communities with established tourism infrastructure typically show stronger appreciation rates but higher entry costs, while emerging areas offer better value with higher growth potential.
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Are there any common legal or procedural pitfalls foreigners face when buying property in Costa Rica, and how can I avoid them?
Foreign property buyers commonly encounter specific pitfalls that can result in financial losses or legal complications.
- Inadequate Due Diligence: Failing to verify property titles, boundary surveys, and permit status can lead to ownership disputes or inability to develop properties. Always hire independent legal counsel to conduct comprehensive title searches and verify all documentation.
- Maritime Zone Confusion: Misunderstanding restrictions in coastal areas can result in purchasing properties with limited ownership rights or development restrictions. Verify exact distances from high tide lines and understand concession requirements.
- Incomplete Documentation: Missing permits, outdated surveys, or unpaid taxes can complicate transfers and create future liabilities. Ensure all permits including SETENA environmental approvals and municipal licenses are current and transferable.
- Currency and Payment Issues: Exchange rate fluctuations and improper fund transfers can create legal and financial problems. Use proper banking channels and legal documentation for all fund transfers.
- Inadequate Legal Representation: Using lawyers recommended by sellers or agents can create conflicts of interest. Always hire independent legal counsel who represents only your interests and specializes in real estate law.
Successful foreign buyers invest time in thorough research, use qualified independent professionals, and maintain conservative timelines for due diligence and closing processes.
How is rental income taxed for foreigners, and what are the reporting obligations and fiscal implications of owning property in Costa Rica?
Rental income from Costa Rican properties is subject to local income tax obligations regardless of the owner's residency status.
Foreign property owners must report all rental income to the Costa Rican tax authority (Tributación Directa) and pay income tax based on progressive rates ranging from 15% to 25% depending on total annual income levels. This applies to both short-term vacation rentals and long-term residential leases.
Property owners can deduct legitimate expenses including property management fees, maintenance costs, insurance premiums, municipal taxes, and depreciation allowances when calculating taxable rental income. Proper documentation and receipts are essential for claiming these deductions.
Additional tax obligations include annual property taxes at 0.25% of registered property value, luxury home taxes for high-value properties, and potential municipal business licenses for rental operations. Foreign owners should also consider double taxation treaties between Costa Rica and their home countries to avoid paying taxes twice on the same income.
Consult with qualified Costa Rican tax advisors to ensure compliance with all reporting obligations and optimize tax efficiency through proper business structure and expense management strategies.
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.
Costa Rica offers foreigners exceptional property ownership rights with minimal restrictions compared to many other countries, making it an attractive destination for international real estate investment.
Success requires understanding specific limitations in maritime and border zones, working with qualified legal professionals, and conducting thorough due diligence to avoid common pitfalls that can affect foreign buyers.
Sources
- TheLatinvestor - Costa Rica Real Estate for Foreigners
- Guide to Costa Rica Real Estate - Foreign Ownership Restrictions
- CRIE - Costa Rica Real Estate Lawyer Guide
- OSA Property Management - Property Ownership Laws
- Henley Global - Costa Rica Residence by Investment
- Lang CR - Real Estate Closings FAQ
- Living Costa Rica - Remote Property Purchase Guide
- Costa Rica Real Estate Service - Purchase Process
- OSA Property Management - Property Documentation
- Langston Realty - Transaction Costs Guide
-Costa Rica Real Estate Prices Drop