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
Costa Rica offers foreigners the same property ownership rights as citizens, with no nationality restrictions on titled land.
As we reach mid-2025, the Costa Rica property market remains strong with 5-8% rental yields in tourist areas and steady appreciation driven by political stability and growing foreign investment. Whether you're looking to relocate or invest, understanding the legal framework, costs, and regional differences is crucial for making an informed decision.
If you want to go deeper, you can check our pack of documents related to the real estate market in Costa Rica, based on reliable facts and data, not opinions or rumors.
Foreigners can legally buy property in Costa Rica with full ownership rights, no residency required, and the process can be completed remotely via power of attorney.
Expect 3.5-6% closing costs, 0.25% annual property tax, and 5-8% rental yields in popular areas like Tamarindo and Nosara, with strong market outlook for 2025.
| Aspect | Key Information | Cost/Details |
|---|---|---|
| Foreign Ownership Rights | Full ownership allowed on titled land | Same rights as citizens |
| Residency Required? | No, can buy on tourist visa | $150,000 investment qualifies for residency |
| Closing Costs | Transfer tax, legal fees, registration | 3.5-6% of purchase price |
| Annual Property Tax | Municipal tax on declared value | 0.25% (+ luxury tax if >$250k) |
| Rental Yields | Tourist areas perform best | 5-8% gross (up to 12% short-term) |
| Popular Investment Areas | Guanacaste, Central Valley, Southern Zone | $200k-$1M+ depending on location |
| Capital Gains Tax | On property sale profit | 15% on gain or 2.25% of sale price |
Can foreigners legally buy property in Costa Rica?
Yes, foreigners have full legal rights to buy and own property in Costa Rica with the same privileges as Costa Rican citizens.
There are no restrictions based on nationality for purchasing titled land (fee simple ownership), which includes residential homes, commercial buildings, and agricultural properties. The Costa Rican Constitution guarantees these property rights to all buyers regardless of their country of origin.
The main exception is the Maritime Zone (Zona Marítimo Terrestre), which covers the first 200 meters from the high tide line on the coast. The initial 50 meters are public land that cannot be owned by anyone, while the following 150 meters can only be held as a concession lease where foreigners are limited to 49% ownership.
Border areas near Nicaragua and Panama, river mouths, nature reserves, and islands also have special regulations that may restrict foreign ownership. Always verify the property's legal status and location before proceeding with any purchase.
It's something we develop in our Costa Rica property pack.
What visa or residency status do you need to buy property?
You don't need any specific visa or residency status to purchase property in Costa Rica - tourists can buy real estate while on a standard 90-day tourist visa.
Property ownership itself doesn't automatically grant residency rights in Costa Rica. However, investing a minimum of $150,000 USD in real estate (as of June 2025) qualifies you for the "Inversionista" (Investor) Residency category, which allows you to live legally in the country.
The investment property must be registered in your personal name or a Costa Rican corporation you control, and it must be free of liens or mortgages. The residency application process is separate from the property purchase and requires additional documentation including police clearances, birth certificates, and proof of the investment.
Many foreigners choose to buy property first and apply for residency later if they decide to spend more time in Costa Rica. The investor residency must be renewed every two years and doesn't lead directly to citizenship.
Can you complete the purchase remotely from abroad?
You can complete the entire property purchase process without being physically present in Costa Rica by using a special power of attorney (POA).
The POA must be granted to a trusted representative - typically your lawyer, a friend, or real estate agent - who will sign all documents on your behalf. This document can be executed at a Costa Rican consulate in your home country or before a local notary public, though it will need to be apostilled and translated if done outside Costa Rica.
All preliminary steps including property searches, negotiations, due diligence investigations, and even virtual property tours can be handled remotely through video calls and digital communications. Your appointed representative will handle the physical aspects like property inspections and document signings.
Some Costa Rican banks may require your physical presence to initiate international wire transfers for the purchase funds, though many buyers work around this by using escrow services or their home country banks. Remote purchases have become increasingly common since 2020, with most real estate professionals now well-equipped to facilitate distance transactions.
What are the taxes and fees when buying and selling?
| Transaction Type | Fee/Tax | Amount |
|---|---|---|
| Buying Costs | Transfer Tax | 1.5% of purchase price or fiscal value (whichever is higher) |
| Registration Stamps | 0.85% of property value | |
| Notary/Legal Fees | 1-1.5% + 13% VAT | |
| Escrow Services | $400-$1,200 | |
| Due Diligence (surveys, inspections) | $1,500-$3,000 | |
| Annual Taxes | Municipal Property Tax | 0.25% of declared value |
| Luxury Tax (if >$250,000) | Additional 0.25-0.55% | |
| Selling Costs | Capital Gains Tax | 15% on profit or 2.25% of sale price |
| Agent Commission | 6% + 13% VAT | |
| Seller's Closing Costs | 2-3% of sale price |
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How does the buying process work step by step?
The Costa Rica property purchase process follows a structured legal framework that protects both buyers and sellers through mandatory notary involvement.
First, you'll find a property and submit a formal offer through a Letter of Intent or Option to Purchase Agreement, typically accompanied by an earnest money deposit of 10% held in escrow. Your lawyer then conducts comprehensive due diligence, verifying the property title at the National Registry, checking for liens or encumbrances, confirming zoning compliance, and ensuring the Plano Catastrado (official survey map) is properly registered.
Once due diligence is satisfactory, both parties meet (or their POA representatives) before a Notary Public to sign the Transfer Deed (Escritura de Traspaso). The notary prepares this deed, calculates and collects all transfer taxes and stamps, and submits everything to the National Registry for official recording.
Essential documents include the Plano Catastrado (survey plan), Escritura (property deed), Certificación Literal (registry certificate showing clear title), Personería Jurídica (if buying through a corporation), and proof of funds origin for anti-money laundering compliance. The entire process typically takes 30-60 days from offer acceptance to final registration.
It's something we develop in our Costa Rica property pack.
Is a lawyer mandatory and what exactly do they do?
Yes, hiring a lawyer is mandatory for all real estate transactions in Costa Rica because only licensed attorneys who are also Notary Publics can legally transfer property titles.
Costa Rican notaries serve a dual role - they act as public officials who authenticate and register legal documents while also providing legal counsel to protect your interests. Your notary-lawyer will conduct the title search at the National Registry, verify property boundaries match the survey plans, check for any liens or legal disputes, confirm zoning permits and land use restrictions, and ensure property taxes are current.
They draft and execute the transfer deed (Escritura de Traspaso), calculate and pay all transfer taxes and registration fees on your behalf, and submit all documentation to the National Registry for official recording. The notary also verifies the seller's identity and legal capacity to sell, confirms corporate documentation if applicable, and ensures compliance with anti-money laundering regulations.
While notaries are technically impartial public officials, buyers typically choose and pay for the notary to ensure their interests are protected. Never use the seller's notary exclusively - always have your own legal representation review all documents before signing.
Where do foreigners typically buy and which areas offer the best value?
| Region | Average Price Range (2025) | Best For | Rental Yields | Growth Outlook |
|---|---|---|---|---|
| Tamarindo/Flamingo | $500,000-$1M+ beachfront | Tourism, surf, nightlife | 6-8% | High demand, strong appreciation |
| Nosara | $400,000-$800,000 | Wellness, yoga, digital nomads | 6-8% | Rapidly rising prices |
| Central Valley (San José, Escazú) | $180,000-$500,000 | Urban living, schools, healthcare | 5-6% | Stable, moderate growth |
| Uvita/Dominical | $200,000-$800,000 | Nature, eco-tourism, quiet | 7-10% | Fast appreciation, emerging |
| Santa Teresa/Mal País | $300,000-$700,000 | Surf culture, bohemian vibe | 7-9% | Strong growth potential |
| Manuel Antonio | $400,000-$1M+ | Established tourism, nature | 6-7% | Steady, mature market |
| Caribbean Coast (Puerto Viejo) | $150,000-$400,000 | Alternative lifestyle, affordable | 5-6% | Slower development |
How do regions compare for lifestyle and investment potential?
Costa Rica's diverse regions offer distinct advantages depending on whether you prioritize lifestyle amenities, rental income, or long-term appreciation potential.
Guanacaste Province, particularly towns like Tamarindo and Nosara, leads in investment returns with 6-8% rental yields and strong appreciation driven by North American buyers and established tourism infrastructure. These Pacific coast communities offer international restaurants, medical facilities, and active expat communities, though prices have risen significantly with beachfront properties now exceeding $1 million.
The Central Valley around San José, Escazú, and Santa Ana provides urban conveniences including top international schools, modern hospitals, shopping malls, and cultural attractions. Property prices remain more stable here at $180,000-$500,000 for family homes, with steady 5-6% rental yields primarily from long-term tenants rather than vacation rentals.
The Southern Pacific zone including Dominical, Uvita, and Ojochal represents the frontier for appreciation potential, with property values rising 10-15% annually as infrastructure improves. These areas attract eco-conscious buyers seeking larger properties amid pristine nature, though amenities remain more limited than established tourist zones.
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.
What mistakes do foreigners commonly make when buying?
The most critical error foreigners make is not hiring their own independent lawyer-notary to verify property titles and conduct proper due diligence.
Many buyers fall into the trap of purchasing concession properties in the Maritime Zone without understanding they're buying a lease, not ownership, with restrictions limiting foreign control to 49%. These concessions can be revoked by the municipality, leaving buyers with no recourse for recovering their investment.
Skipping professional property surveys and title searches leads to boundary disputes, discovering liens after purchase, or finding out the property has legal restrictions preventing your intended use. Buyers often underestimate total costs by forgetting to budget for closing costs (3.5-6%), annual property taxes, luxury taxes on homes over $250,000, and eventual capital gains taxes of 15% when selling.
Another costly mistake is assuming property ownership grants residency rights - it doesn't unless you invest at least $150,000 and separately apply for investor residency. Overpaying in overheated markets without comparing regional prices, not verifying actual rental income potential before buying investment properties, and using verbal agreements instead of written contracts all frequently cause problems.
It's something we develop in our Costa Rica property pack.
Can foreigners get mortgages in Costa Rica?
Foreigners can obtain mortgages from Costa Rican banks, but the terms are significantly less favorable than in North America or Europe.
Non-resident foreign buyers face strict requirements including extensive income documentation, bank statements, tax returns, and often need Costa Rican residency for better terms. Interest rates typically range from 7% to 10% or higher, compared to 3-5% in the US, with loan-to-value ratios limited to 50-70% meaning larger down payments of 30-50%.
Banks offer shorter loan terms of 15-20 years versus the 30-year mortgages common elsewhere, resulting in higher monthly payments. The application process can take 2-4 months with requirements for property appraisals, life insurance policies, and sometimes guarantors.
Private lenders and developer financing offer alternatives with faster approval but often at 12-15% interest rates. Many foreign buyers choose to pay cash or secure financing in their home country through home equity loans or retirement account borrowing. To improve mortgage approval chances, establish Costa Rican bank accounts early, obtain residency status, show stable income for 2+ years, and consider starting with a smaller investment property to build local credit history.
What rental income can you expect in different areas?
- Beachfront Tourist Zones (Tamarindo, Manuel Antonio): Gross yields of 6-8% annually with peak season occupancy reaching 80-90% from December through April
- Emerging Beach Towns (Nosara, Santa Teresa): Higher yields of 7-10% due to growing demand from digital nomads and wellness tourists seeking monthly rentals
- Central Valley Urban Areas (San José, Escazú): Stable 5-6% yields from long-term rentals to professionals and expat families
- Mountain Towns (Atenas, San Ramón): Lower yields of 4-5% but consistent year-round occupancy from retirees seeking cooler climates
- Southern Pacific (Uvita, Dominical): Exceptional 8-12% yields on well-managed vacation rentals capitalizing on eco-tourism growth
Short-term vacation rentals through Airbnb and VRBO in prime locations can generate $2,000-$5,000 monthly during high season (December-April) and $1,000-$2,500 in green season (May-November). Professional property management typically costs 20-25% of rental income but ensures consistent bookings and maintenance.
What's the real estate outlook for 2025 and beyond?
Costa Rica's real estate market outlook for 2025 remains strongly positive, with continued price appreciation expected in key tourist and expat destinations.
As of June 2025, the market benefits from Costa Rica's political stability, growing tourism sector recovering beyond pre-2020 levels, and increasing remote work migration from North America and Europe. Guanacaste and the Central/Southern Pacific regions are experiencing 10-15% annual price growth, particularly for ocean-view properties and homes in established expat communities.
The government's infrastructure investments including the expanded Route 27 to the Pacific coast and improved regional airports are opening previously isolated areas for development. Sustainable and eco-friendly properties command premium prices as Costa Rica maintains its environmental leadership, attracting conscious investors.
Market indicators suggest this is still a good time to buy, with inventory levels increasing but demand remaining strong in prime locations. Interest rates have stabilized, the colón remains relatively stable against the dollar, and new regulations have improved property transaction transparency. The main risks include potential oversupply in some beach markets and global economic uncertainty, but Costa Rica's fundamentals - safety, stability, and natural beauty - continue attracting long-term investors and lifestyle buyers.
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's property market offers foreigners excellent opportunities with full ownership rights, no residency requirements, and strong rental yields of 5-8% in popular areas.
Success requires understanding the legal framework, working with qualified professionals, and choosing the right location for your goals. With proper due diligence and realistic expectations about costs and processes, foreign buyers can confidently invest in this stable Central American market.
Sources
- The Latin Investor - Costa Rica Real Estate for Foreigners
- Visit World Today - Buying Property in Costa Rica Guide
- CRIE - Costa Rica Property Ownership
- Global Property Guide - Costa Rica Buying Guide
- Coldwell Banker - Property Buying Process 2025
- Lawyers of Costa Rica - Real Estate Law
- GAP Real Estate - Market Trends
- The Latin Investor - Costa Rica Real Estate Market
- Global Property Guide - Costa Rica Rental Yields
- Investing Costa Rica - 2025 Investment Outlook