Since its introduction in 2021, the MLS (Multiple Listing Service) in Costa Rica has gained significant traction and is now widely used by successful real estate professionals, including us at ABC Real Estate.

The new MLS (Multiple Listing Service) in Costa Rica is a game changer for buyers, sellers, and real estate professionals. This powerful tool provides up-to-date, comprehensive listings that help buyers make informed decisions when searching for properties. Whether you’re looking for your dream home, investment property, or a vacation spot, the MLS gives you access to a wide range of properties with detailed information such as pricing, location, and features.

For sellers, the MLS ensures maximum exposure to a broad audience of qualified buyers. This increases the likelihood of a faster sale at a fair price. With transparent and accurate data, buyers and sellers can negotiate more effectively and avoid surprises during the process.

With the MLS, buyers can be confident they are seeing every property that matches their criteria. The platform is always updated, ensuring that you don’t miss out on the latest opportunities in Costa Rica’s real estate market.

In short, the MLS is revolutionizing the way real estate is bought and sold in Costa Rica by offering a level of professionalism, transparency, and efficiency that benefits both buyers and sellers, helping everyone navigate the market with ease and confidence.

Importing a car from the U.S. for example into Costa Rica involves several steps and fees, including import taxes, customs procedures, and registration. Here’s a breakdown:

1. Import Taxes

• Import Duty: Costa Rica imposes a duty based on the vehicle’s value and age:
  • Less than 3 years old: 52.29% of the car’s value.
  • 4-5 years old: 63.91% of the car’s value.
  • Over 6 years old: 79.03% of the car’s value.
• Selective Consumption Tax: This varies depending on the car type and engine size, typically between 30% and 40%.
• Value Added Tax (VAT): Set at 13% of the CIF value (Cost, Insurance, and Freight), plus the import and selective consumption taxes.

The car’s value for these taxes is determined by the Ministry of Finance using its own valuation tables, which might differ from Kelley Blue Book or U.S. market values.
Here is a link to calculate the costs: https://serviciosnet.hacienda.go.cr/AutoHacienda/

2. Shipping and Freight Costs

• Shipping a vehicle from the U.S. to Costa Rica generally costs between $800 and $1,500, depending on the shipping method and port of departure. Popular Costa Rican ports are Puerto Limón and Puerto Caldera.

3. Inspection and Registration Requirements

• Technical Inspection (RITEVE): All imported vehicles must pass Costa Rica’s vehicle inspection for safety, emissions, and mechanical standards.
• National Registry and License Plates: After clearing customs, you’ll register the vehicle with the Registro Nacional. Registration fees vary based on the car’s value and age.

4. Required Documents

• Original title and Bill of Sale, proving ownership.
• Shipping manifest, Bill of Lading, or Air Waybill.
• Any other documents required by the customs agency in Costa Rica.

5. Customs Broker Assistance

• Hiring a customs broker is often advisable to simplify the process, as they can handle paperwork, valuation, and help navigate the tax and registration processes. Their fees typically range from $200 to $500.

6. Exemptions and Recent Legislation

• Recent Costa Rican legislation may offer tax-free import incentives for new residents or retirees relocating to Costa Rica, which can waive import duties on one vehicle. Be sure to confirm this with an official or a customs broker, as eligibility and procedures for these exemptions may vary.
  
  

Great question! Many new property owners in Costa Rica ask about this. If you own property outside a managed community, such as a condominium or gated area, we highly recommend hiring a caretaker—especially for larger or remote properties. A caretaker can help maintain your land, protect against potential issues, and ensure everything stays in top shape while you’re away.

At ABC Real Estate, we can connect you with reliable caretakers and offer helpful tips tailored to your property’s unique needs and location.

Finding a trustworthy builder or contractor is essential for any successful project. ABC Real Estate can help connect you with reputable architects, engineers, and contractors who have proven track records. Based on our recommendations and your preferences, you can choose the professionals who match your style and project vision. We’ll provide examples and insights to support you in making the best decision for your needs.

Building costs for a private home in Costa Rica typically range from $1,000 to $2,000 per square meter (or $100 to $200 per square foot) for high-quality, enclosed construction. This estimate covers essential elements like walls, floors, windows, doors, roofing, electrical systems, and plumbing but does not include furniture, appliances, pools, or landscaping.

Costs can vary based on several factors, including the materials and construction style you choose, the contractor’s rates, and the specifics of your land, such as soil type, location, and accessibility.

Building a home can be a rewarding option, but it comes with challenges, as it does anywhere. Buying an existing property is often easier because you can see exactly what you’re getting. Over recent years, Costa Rica has improved in terms of access to quality construction materials and reputable contractors, even in more remote beach areas.

However, older homes may lack the modern features or design flexibility you’re seeking. If available options don’t meet your vision or require too many compromises, building might be a better choice.

In Costa Rica, there is a clear process for new construction, supported by a licensing body for architects and engineers that also sets professional standards and fees. With the right guidance, building can become a manageable and rewarding option.

In Costa Rica, properties located within the Maritime Zone (the first 200 meters from the high tide line) are typically concession properties, meaning they are leased from the government rather than fully owned. However, a rare exception exists for properties registered before 1973. If a property within the first 50 meters was titled before that year, it holds a full title, allowing for 100% ownership just like properties outside the Maritime Zone.

Less than 5% of beachfront properties in Costa Rica are titled. Most of them are within the Tamarindo area. This is a unique opportunity for complete ownership, as concession properties within the Maritime Zone cannot be converted to titled properties.

A concession property in Costa Rica is essentially a lease from the government and local municipality, rather than outright ownership. These concessions, which allow for land use in designated areas (mainly within the Maritime Zone), must be approved by the Costa Rican Tourism Institute (I.C.T.) and typically last for 20 years. When a concession period expires, it can usually be renewed for another similar term, provided all requirements are met.

If you’re considering buying beachfront property in Costa Rica, it’s essential to understand the Maritime Zone Law, which governs the first 200 meters of land from the high tide line.

The first 50 meters from the high tide mark is considered public land and cannot be privately owned or developed. The following 150 meters is known as the concession zone, where property can be leased through a government concession. However, if a property within this area was registered before 1973, it may hold a full title and can be fully owned and transferred, often referred to as being “titled to the 50-meter line.”

Costa Rica offers several residency options, including Pensionado (for retirees), Rentista (for those with stable income), and Inversionista (for investors). The best option depends on your personal situation.

We recommend consulting a qualified lawyer or immigration expert who can guide you through the requirements and application process for each type of residency.

No, you don’t need residency to buy property in Costa Rica—you can purchase property as a tourist. However, if you plan to live here year-round, having legal residency can make things easier. As a tourist, you must leave the country every 90 days for at least 72 hours to renew your visa. Many non-residents take this opportunity to explore neighboring countries like Nicaragua or Panama.

If you’re considering long-term living, there are various residency options available. We from ABC Real Estate can connect you with a reputable attorney who can help determine the best residency status for your needs.

Before purchasing property in Costa Rica, it’s crucial to confirm that the title is clear of any liens or encumbrances. You or your attorney should take steps to ensure the property is properly registered and free of legal issues.

The Property Registry (Registro de la Propiedad) in San José – Zapote is where all property documents are recorded. A title search at the Registry will verify the title’s validity and confirm ownership.

If any changes have been made to the title, they must be recorded at the Registry. The Public Registry report (informe registral) provides key details about the property, such as the owner’s name, boundaries, tax appraisal, liens, mortgages, easements, and other legal considerations that may affect the title.

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Yes, you can choose to have the property title in your personal name or in the name of a corporation—this decision depends on your preferences and goals.

While holding the title personally is possible, many investors opt to use a corporation to hold property in Costa Rica. This option is common and simple to set up, providing benefits such as asset protection and owner anonymity. To form a corporation, you’ll need a valid passport for three representatives (president, vice president, and treasurer—who can all be foreigners). The cost for establishing a corporation typically ranges from $600 to $1,500.

In most cases, the seller or property owner is responsible for paying the sales commission to the realtor or broker at closing.

As a buyer, you typically do not need to pay any commission unless you have specifically agreed to do so in advance.

As of July 1, 2019, Costa Rica implemented a 15% capital gains tax on the difference between the purchase and sale price of a property.

For properties purchased before that date, owners can choose to pay a lower rate of 2.25% based on the sales price instead.
Additionally, if the property was used as the owner’s primary residence, they may be exempt from the capital gains tax.

There are also strategies to minimize or avoid capital gains tax, such as setting up a corporation and taking advantage of available exemptions.

At ABC Real Estate, we’re happy to assist you in finding the best solution tailored to your needs.

How much are property taxes in Costa Rica?

Property taxes in Costa Rica are relatively low compared to the United States, Canada, or Europe, with a rate of just 0.25% of the declared property value.

As a property owner, it’s your responsibility to update the property’s value every five years with the local municipality. When you submit the necessary application, the value will be adjusted according to the municipality’s assessment procedures.

If you’re selling property and haven’t updated the value, it’s advised to do so for a smoother transaction process.

This tax is managed at the municipal level and can vary depending on factors such as property type and location. Property taxes can be paid either quarterly or annually.

In Costa Rica, closing costs are typically shared equally between the buyer and the seller. However, this can be negotiated based on the specifics of the transaction. As a general rule, closing costs are about 4% of the purchase price, so both parties will usually pay around 2% each.

There are three main fees involved in closing costs:

1. Notary Fees
   Notary fees are based on the real sales price: 1.5% for the first one million Colones (local currency) and 1.25% on the balance. For a quick estimate, you can calculate 1.5% of the purchase price to get a good idea of the notary fees.
2. Transfer Tax
   A one-time transfer tax of approximately 2.5% of the property price is required. This includes several minor fees and stamp duties.
3. Escrow Services
   Escrow (or Fideicomiso) is used as a neutral third-party entity to hold funds until the transaction is completed. Escrow services ensure compliance with money laundering laws and verify proof of funds for the seller. Fees for escrow services start at around US$500, depending on the transaction size and the company used.
   Be sure to choose an escrow service that is reliable and registered with SUGEF, the Costa Rican governmental financial regulator. Especially if you intend to receive the funds at a Costa Rican Bank.

Additionally, the seller may have other costs, such as capital gains tax and sales commissions.

At ABC Real Estate, we can help provide a quick estimate of the closing costs based on the property you are buying or selling.

When the purchase price is financed, there are typically three options for selecting the notary or attorney to handle the title transfer: either the buyer’s or the seller’s attorney becomes the notary, or both parties may act jointly as co-notarios.

If the seller is financing a large portion of the purchase price and a mortgage is involved, the seller may request that their own notary or attorney draft the transfer deed. This ensures that both parties are protected during the transaction and that the financing terms are clearly outlined in the deed.

Financing through a bank for non-residents in Costa Rica can be challenging due to bureaucratic processes. Interest rates typically range from 8.5% to 12% for US dollar loans. As a result, most real estate transactions are cash deals or seller-financed, often with short-term terms (6 months to 3 years) and substantial down payments (typically 50%).

Some buyers find it easier and more affordable to secure financing through a first or second mortgage on property they own in their home country, using those funds for a property purchase in Costa Rica.

Occasionally, private lenders also offer financing options. We’d be happy to introduce you to them if needed.

If you’ve found a property on your own, ABC Real Estate is happy to assist you as your buyer’s agent. We offer professional guidance throughout the entire purchase process.

Our services are completely free to you, with no additional costs. The commission is included in the purchase price and is agreed upon between the seller and the listing agent. When we represent you as the buyer, we will split the commission with the listing agent.

When purchasing property in Costa Rica, it’s essential to request an official Costa Rican Registry Survey of the property. If one hasn’t been completed — which can be common when buying a portion of a larger parcel — ask that any deposit be held by the attorney until an official survey is provided.

In such cases, it’s advisable to review the official Registry Survey of the parent property (mother parcel) to ensure proper boundaries and legal details before proceeding with the transaction.

Ask to see an official Costa Rican Registry Survey of the property. If one has not been completed, which can be common when purchasing a section of a larger parcel, request that any deposit be held by the attorney until an official survey has been provided.

If this is the case, ask to review the official Registery Survey of the mother parcel.

Once you’ve found your ideal property in Costa Rica, it’s crucial to understand the legalities of the buying process and your rights as a foreigner. This is where ABC Real Estate comes in — we provide expert guidance and ensure a smooth transaction every step of the way.

Steps to Buying Property:

1. Make an Offer
   Once you’ve decided on a property, the first step is to submit a written offer or letter of intent to the seller. After negotiating the price, terms, and conditions, both parties will sign an agreement. At this point, you’ll make a down payment (usually 10% of the purchase price) into an escrow account. This secures the property and takes it off the market until the next steps are completed.
2. Due Diligence Period (2-4 Weeks)
   During the Due Diligence (DD) period, your attorney will conduct legal research and verify the property’s details. If needed, your attorney may also recommend other professionals, such as accountants, surveyors, or home inspectors. If any issues arise during DD, you can request that they be resolved, or you may receive your down payment back in full.
3. Finalizing the Transaction
   If everything is satisfactory, the deposit becomes non-refundable and is applied to the purchase price. Your attorney will act as the notary and draft the closing statement, which will be circulated to all parties for review and signature. Once signed, the final balance payment is made, and the transaction is officially closed.

ABC Real Estate will assist you throughout the process, ensuring the agreement is comprehensive and that the transaction is secure and seamless from start to finish.

Yes, it is essential to work with an attorney when purchasing property in Costa Rica. An experienced attorney will ensure that all legal aspects of the transaction are handled properly and can address any questions you may have.

At ABC Real Estate, we can refer you to a reputable attorney who speaks your language and understands the unique needs of foreign property buyers in Costa Rica. This expert guidance will help you navigate the legal process smoothly and with confidence.

When buying property in Costa Rica, it’s strongly recommended to work with a reputable and experienced real estate company. While many individuals, such as “street realtors,” taxi drivers, bartenders, and tour operators, may offer to show properties, they often lack the necessary expertise and resources to help you navigate a successful and legally sound transaction.

The introduction of the new MLS (Multiple Listing Service) in Costa Rica is a game-changer, offering valuable insights to both buyers and sellers. This service enables more informed decisions, helping facilitate professional transactions in ways that were never possible before.

While it may seem tempting to save money by using an unqualified agent, it’s important to know that in Costa Rica, anyone who brings a buyer and seller together typically earns a commission. This may result in a lack of expert advice or a suboptimal deal.

Choosing a professional real estate company like ABC Real Estate ensures that you have the knowledge, support, and expertise needed throughout the entire process. From answering your questions to comparing properties and understanding market values, a reputable agent will make your property purchase in Costa Rica smoother and more informed.

Overview of Taxes in Costa Rica: What You Need to Know

Like many countries, Costa Rica has its own set of annual taxes. However, not all taxes apply to every property owner. Here are the key taxes you should be aware of when owning property in Costa Rica:

Capital Gains Tax

Due: At Closing of the Property Sale

As of July 1, 2019, Costa Rica introduced a 15% capital gains tax on the profit made from the sale of real estate. However, if the property was purchased before this date, the seller has the option to pay a one-time tax of 2.25% based on the sales price, rather than the full capital gains tax.

• Exemptions: Properties that served as the owner’s primary residence or were used for business purposes are exempt from the capital gains tax.
• Buyer’s Responsibility: The buyer is required to withhold 2.5% of the sales price at the time of purchase to ensure the capital gains tax is paid. This is to prevent foreign property owners from selling without settling their tax obligations.

Luxury Tax

Due: January 15th of Each Year

The Luxury Tax (also known as the Solidarity Tax for Housing Programs) applies to residential properties such as houses, condos, and apartments that exceed a certain value threshold. For 2024, the threshold was 145,000,000 colones (approximately US$279,000), and this amount is adjusted annually.

Annual Corporation Tax

Due: January 31st of Each Year

Corporations, subsidiaries, and limited liability companies (LLCs) registered with the National Registry must pay an annual corporate tax under Law #9428 (“Tax on Legal Entities”). This tax is in addition to any VAT or Income Tax the corporation may be subject to if it is active and registered as a taxpayer.

Property Tax & Garbage Collection Fees

Due: March 31st of Each Year

Property owners must pay two fees to the local municipal government:

1. Property Tax (Impuesto sobre Bienes Inmuebles): This tax is 0.25% of the registered value of the property as per the municipality’s valuation. It’s the property owner’s responsibility to update the property value every five years.
2. Garbage Collection Fees: This fee covers waste collection services, which are typically three times per week. The garbage collection fee is determined by the municipality based on property usage (residential or commercial) and location. For 2021, residential properties had an annual fee starting at US$74, while commercial properties started at US$221. These fees can be paid either quarterly or annually.

Avoiding Penalties

It’s crucial to pay all applicable taxes on time to avoid any fines or penalties. Stay up-to-date with your property tax, corporate tax, luxury tax, and garbage collection fees to ensure compliance with Costa Rican law.

By staying informed and adhering to these tax regulations, you can avoid unnecessary complications and ensure that your property ownership in Costa Rica is both smooth and legally compliant.