Top 10 Most Important Things to Know for Purchasing Real Estate in Costa Rica
Top 10 Most Important Things to Know for Purchasing Real Estate in Costa Rica:
- Legal Ownership Rights: Foreigners have the same rights as locals when purchasing property, and you can own land outright or through a corporation.
- Hiring a Real Estate Attorney: It’s essential to work with a reputable attorney familiar with Costa Rican real estate laws to ensure due diligence is conducted properly.
- Understanding the Types of Property: Know the differences between titled property (more secure) and concession property (leases from the government), especially for beachfront areas.
- Property Taxes and Fees: Costa Rica has relatively low property taxes (0.25% of the property’s registered value), but there are additional fees, such as annual corporation tax if the property is held by a company.
- Financing: Most real estate transactions are cash-based, as securing a mortgage through a Costa Rican bank can be difficult for foreigners. Be prepared for alternative financing options.
- Property Inspections: Hire a qualified inspector to assess the property’s condition, infrastructure, and potential for natural risks like flooding or landslides.
- Infrastructure and Utilities: Some areas, especially in more rural parts, may have limited access to utilities like water, electricity, and internet. Research availability before purchasing.
- Understanding Zoning Laws: Costa Rica has strict zoning and environmental regulations, especially near the coast. Ensure your intended use of the land complies with these laws.
- Market Trends and Locations: Different regions of Costa Rica cater to different lifestyles. For example, the Central Valley offers a cooler climate, while coastal areas are popular with tourists and expats. Research to find the right fit.
- Closing Process and Costs: The closing process can take longer in Costa Rica than in other countries, so be patient. Also, expect closing costs to range between 3%-4% of the purchase price, including attorney fees, notary fees, and transfer taxes.
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