Go to Top 10 Costa Rica for the complete guide on all you need to know about Costa Rica, including hotels, tours, beaches, real estate and investing, safety, health information, maps, culture, traditions, and daily news.
1- LOCATION, LOCATION, LOCATION.
Costa Rica is among the most highly sought-after tourist destinations. Its strategic position in the heart of the Western Hemisphere, infrastructure, access to international markets, labor quality and cost, as well as its government’s positive attitude towards foreign investment, make Costa Rica an ideal setting for retiring, investing, or living. Costa Rica’s natural and geographical diversity provides sound options for a wide range of luxury, retirement and vacation homes.
2- THE VIEW YOU WERE LOOKING FOR.
Costa Rica covers 19,730 square miles (51,100 km2), and though it accounts for only 0.3 per cent of the world’s land area, it contains 6 per cent of its biodiversity. Whether you are looking for an ocean, city or mountain view, there is something for everyone in Costa Rica.
3- OWNERSHIP RIGHTS.
Unlike Mexico and other countries, the Costa Rican government allows foreign investors to hold fee simple titles. Local banks make financing available to qualified foreign buyers. Title insurance also is available.
4- POLITICAL STABILITY = SAFE INVESTMENT.
Costa Rica has a long democratic and world renowned tradition, which has more than 115 years of history. Such respect for political and peace processes was evidenced by the abolition of the military in 1948 and acknowledged internationally in 1987 when then-President of the Republic, Oscar Arias Sánchez, was awarded the Nobel Peace Prize.
5- WHEN THE TOURISM INDUSTRY GROWS, SO DOES THE REAL ESTATE INDUSTRY.
Leading brands such as Four Seasons, Saint Regis, and Marriott have chosen Costa Rica for its great potential to attract foreign investment. The U.S. is among the countries most interested in investing in Costa Rica. Tourism is the main economic activity in Costa Rica. The country receives 1.6 million tourists annually, which generates $1.6 billion in earnings.
6- STRATEGIC LOCATION.
(Three hours from the U.S.): Costa Rica is located in the center of the Americas, with two major airports providing excellent international access. Most citizens from the U.S., Canada and countries in Europe do not need a visa. Seventy-six per cent of passengers arriving at the Daniel Oduber Airport in Guanacaste are North American, providing the primary market for developments in the area.
7- COMPETITIVE CONSTRUCTION COSTS.
It’s relatively easy to develop in Costa Rica. A good work force comes at a fairly low cost compared to that of the U.S. A home costing $100 per square foot to build in Costa Rica could cost $250/sf (Columbus), $350/sf (Dallas or Atlanta), or even more than $500/sf (San Francisco, Los Angeles, or Miami).
8- LOW TAXES.
Under Costa Rican tax law, you must declare the value of your home to the Costa Rican Municipal Government every five years. An annual flat rate of 0.25 percent is charged, calculated on the declared land and house value combined. Owners of homes within the Maritime Zone or of concessions near national parks pay property tax only on the value of the house, not the land itself. For example, property taxes on a home in Dominical outside the Maritime Zone, with a combined land and house value of $300,000, would be approximately $750.
9- EXCELLENT QUALITY OF LIFE.
Stability and economic growth reflect relevant social achievements. Among them is the reduction of poverty from 40 per cent to 20 per cent over the last 20 years. In addition, Costa Rica has achieved the highest education and health levels in Latin America and has been able to provide the population with wide access to health services, social security, potable water, and basic public services. Costa Rica’s literacy rate of 95.8 percent is comparable even to those of highly developed countries, and the workforce is becoming increasingly bilingual.
10- YOU HAVE A PERFECT PARTNER IN COSTA RICA.
We can guide you with confidence, to your dream investment in Costa Rica. We provide clients interested in Costa Rican real estate with the resources they need to insure that the process of investing in or purchasing land or a home runs as smoothly as it would in their home country. Our comprehensive professional and local knowledge is available to support and complement your decision-making process. In short, we offer the peace of mind that comes with knowing you have all the facts about Costa Rica real estate.
***MUST SELL QUICK*** ***OWNER MOTIVATED TO SELL*** ***PRICE NEGOTIABLE*** ***OWNER FINANCING AVAILABLE***
Beautiful, spacious 2 story American style modern house in Urbanizacion Vista Nosara, in San Francisco de Heredia (between downtown Heredia and Cariari). 3 bedroom + office, 2.5 bathrooms, approx 200 sq m (2200 sq ft) home on a 240 sq m (2600 sq ft) lot.
Parquet and ceramic tile on second floor, ceramic tile on first floor, lots of balcony area throughout the second floor. Covered patio in spacious backyard with fruit trees, great for big dogs, with custom made outdoor BBQ bar area, great for hosting large parties. Master bedroom has large doors out to the balcony with lots of air and light, walk-in closet with full private bathroom. No drywall or cutting corners. Indoor car garage with custom shelves for tools, etc.
Lots of custom made furniture included, widescreen 42″ LCD HDTV with custom stand, custom wrought iron curtain rods, kitchen and laundry appliances (Amana fridge, Whirlpool washer and dryer). Cable modem Internet installed as well as two phone lines through ISDN. Yes, all furniture and appliances are included!
ADT monitored alarm system, secure area. Multiple motion-activated lights throughout. Automatic door opener for letting guests in with buttons on both floors.
Excellent, quiet neighborhood, many English speaking neighbors. Public park across the street, coffee field for miles on one side, house overlooks coffee field, valley and mountains. Near downtown Heredia and nearby amenities, Hipermas, new train station to downtown San Jose. Very close to Real Cariari (and highway to airport) as well as Paseo de las Flores mall. 5-minute walk to AMPM. Far enough from the main road to avoid car noises and pesky bus fumes, but close enough to walk there.
House held in corporate name, and can be sold with corporation at no extra charge. Owner financing is available.
To arrange a visit call +506-2262-6114 or email me at glenn@rxcr.com
In today’s world the value of assets is not always obvious. It is often latent, and has to be unlocked through financial and human capital. We recommend Gap Investors, who focus on unlocking this latent value in Costa Rican property development.
Gap Investors specializes in brokering syndicated loans, which are loans offered by a group of lenders, to provide funds for a borrower to start a real estate development project on properties with high potential (known as latent value) in Costa Rica.
The goal of this form of lending is to get development plans off the ground. These loans will not be given by risk-averse banks without a significant amount of collateral and a high income, so we come in by bringing in a group of enterprising lenders to provide enough short-term funding to get the development to the point where banks will be open to financing.
Because of the nature of the loan the interest rates are typically higher than regular bank interest rates. Collateral is provided in the form of a mortgage lien on the borrower’s property, which is shared by all lenders in proportion to the funds invested by each, through shares in a corporation holding the mortgage.
Bridge loans are usually short in duration and effectively create a financing bridge from the start to the point where banks are interested in the project.
The loans use multiple lenders to allow maximum flexibility. At Gap Investors, a single investor can finance multiple syndicated loans at one time, therefore diversifying their total investment portfolio.
Contact us for more information on offshore investments, or feel free to visit the Gap Investors web site.
| Lush vegetation, jungles, tropical plant life, and awe-inspiring volcanoes, as well as sun, dreamlike beaches (both the Pacific and Caribbean) and surf are all attracting tourists and property investors.
The average temperature in the Central Valley is 72F or 22C year-round. The temperature near the coasts and on the beaches is around 90F or 32C, also year-round. The abundance of micro-climates has produced one of the richest fauna and flora found in the planet. The greenery and climate make for an everlasting spring in the valley and an everlasting summer at the coasts. There is no cold winter and the sun appears every morning with very few exceptions, which makes it perfect for golf enthusiasts. An investment in Costa Rica is much more certain than an investment in Hawaii real estate was 30 years ago. Costa Rica’s current prosperity is being fueled by the emigration of affluent baby boomers from around the world seeking their own piece of paradise. Costa Rica is one of the most secure and stable of all the Central American countries. It is the only nation in Central America with industries such as tourism and technology that surpass agriculture as the main source of revenue. The country constitutionally abolished its standing army in 1948. The savings were used in health and education and resulted in Costa Rica boasting literacy rates and expected lifespans comparable to developed Western nations. In the past years, significant facts and achievements have placed Costa Rica as the leader in the Central American region with a number of noteworthy milestones. President Oscar Arias Sanchez authored a regional peace plan that earned him the 1987 Nobel Peace Prize — his popularity elected him back to the presidency in 2006. Tourism is one of the main economic activities in Costa Rica; in 2007, 1.9 million tourists generated $1.9 billion, up $300 million from the previous year. The U.S. and Costa Rica have a history of friendly relations. As many as 35,000 U.S. citizens reside in Costa Rica and 500,000 U.S. citizens visit the country annually. Important numbers are also applicable to residents from Canada and Western Europe.
For more information about Costa Rica, including destinations, activities, purchasing real estate, moving to to the country, and news be sure to visit Top 10 Costa Rica. |
CENTRAL VALLEY
Costs: If you choose to buy property and build a home, a property of approximately 1.25 acres (5000 square meters) or greater, with a home will run between $135,000 and $235,000, depending on how large or how luxurious the house is. Lot prices will vary from as low as $10 per square meter to $50 per square meter, with larger tracks of land costing less. Construction costs for a higher quality home will be between $45 and $60 per square foot. Again, it is always possible to spend more if you so choose. It is also possible to find extremely cheap land or construction quotes, but we have found when the price seems too good to be true, it usually is. We have spent many hours screening various properties, weighing price and quality, in order to find property priced well, without sacrificing quality, location, clear title, etc.
The prices of resale homes will vary widely depending on the size of the house and lot, location, quality of finishings and other factors. Keep in mind that many resale homes may have been originally built for Costa Ricans and may not have the features North Americans expect such as bath tubs, large bedrooms or in some cases, modern showers. However, newer homes built specifically for foreigners are becoming more widely available.
Infrastructure: The Central Valley’s infrastructure is far superior to that of the beach. Most streets are paved with asphalt and are considerably wider. While beach areas sometimes suffer from droughts and power outages, these are usually not issues in the Central Valley. You will also have easier access to public transportation, taxi services, a wider variety of grocery stores and other shopping, and the main Inter-American Highway.
Location: Most areas of the Central Valley that we introduce you to are about 45 minutes to the nearest beach. Most towns are also about 45 minutes to San Jose’s international Airport. Things to do in the Central Valley include canopy tours, horseback riding, various nature trails, bungee jumping, fine dining (both international cuisine and typical Costa Rican food), and more. Most towns in the Central Valley are also between 1.5 to 2 hours to the famous Arenal Volcano where you’ll find a variety of tourist attractions such as hot springs, horseback riding, and hanging bridges.
Type of Client: We find the majority of Central Valley tour clients enjoy the ambiance and tranquility of this different life style. Those, especially from the Northeast, find it to be an alleviating escape from the rat race back home. Foreigners living in the Central Valley are usually not “beach goers,” but instead have a higher interest in natural surroundings and outdoor activities.
PACIFIC COAST
Climate: Due to its lower elevation, areas surrounding the ocean tend to be hotter and more humid. Temperatures tend to range from 80 to 95 degrees Fahrenheit during the day, cooling off into the mid 70s at night. Due to the humidity, it may also feel warmer. Air conditioning is a must.
Costs: Prices of homes and condos we show tend to range from $250,000 to $1,000,000. Lot prices will usually cost over $100 per square meter (compared to $10 to $50 in the Central Valley). The cost per square foot to build is also substantially higher due to the high demand for materials from the recent construction boom. For quality, home construction costs generally are between $60 and $100 per square foot.
Infrastructure: Beach areas are well known for their poor roads; however they have been improving in recent years. Lower water supply and more frequent electricity cuts occur than in the Central Valley. It is extremely important to be assured of access to such services before purchasing property. Our goal is to introduce you to developers or real estate agents with a track record of establishing residences without any of these major issues.
Location: All properties we show are within minutes to the beach. There is also a larger array of finer restaurants with dishes from many parts of the world. Things to do include boating, fishing, golfing, and walking along some of the world’s most prestigious white sand beaches.
Type of Client: Clients for the Pacific Coast tour will spend substantially more to live at the beach and to purchase property. The higher prices are due to the enormous demand. The supply of quality developments with breath taking views and a good location is relatively small for the thousands of people who are trying to get a piece of this paradise. Almost all activities are predicated around the beach, and therefore, we wouldn’t recommend this tour to anyone who is not a beach lover. If you are looking to live less expensively, this tour probably isn’t for you, rather, the Central Valley tour would likely be more appropriate.
Today investors from all across the globe are flocking to Costa Rica to invest in the real estate market. With the giant payoffs available, it is easy to see why so many investors are choosing this country to invest their money in.
With giant payoffs available for investors, the time is definitely right to invest in Costa Rican real estate. Although North American real estate seems to be shaky these days, investors can still find excellent returns on investments if they look to Costa Rica. Property prices are affordable, and investors from across the globe are thrilled with the bargain prices and amazing profits available in the real estate market in Costa Rica today.
In the past five years, the real estate market in Costa Rica has taken off and is now in the middle of a boom. With the excellent prices that are affordable and the investment incentives being offered to foreign investors by the Costa Rican government, this is a paradise to investors looking for a new place to invest their cash.
All throughout Costa Rica there are many excellent investment opportunities, and one excellent company that caters to high end investors interested in this market is Gap Investors. Gap Investors Ltda is a Costa Rican company specializing in brokering syndicated loans, which are loans offered by a group of lenders, to provide funds for a borrower for real estate development in Costa Rica.
There are many reasons that Costa Rica has become such a prime spot for real estate investors. Of course first of all is the low price of real estate, which even though it is rising, is still cheaper than places such as the United Kingdom and the United States. The cost of living in Costa Rica also is a drawing point, with the average cost of fine living costing between $900-1200 a month. Property taxes are quite low as well and many times investors are able to cash in on predevelopment prices, both of which make investing in Costa Rica even more attractive to real estate investors.
To learn more about investing in Costa Rica real estate, visit www.gapinvestors.com
Am I legally allowed to own property in Costa Rica?
Costa Rica is a great place to invest because Costa Rica acknowledges investors from other countries and grants them the same rights of owning land as Ticos (Costa Ricans). Most the property you encounter will be fully-titled, meaning that the land deed will be signed over to you in full allowing you to develop, sell, rent, trade or will. The only exception to this law is with “Possession” and “Concession” land. See “Concession and Possession land” below.
I hear about using a corporation to purchase property… what are the advantages of that?
Corporations, like in any country, are designed to protect the consumer. A corporation or in Costa Rica, an S.A. is a legal entity which stands legally on its own reconnaissance. A corporation is legally recognized by the government of Costa Rica. A corporation usually contains positions similar to a fully functioning company allowing several members to partake in a single corporation, i.e. President, Vice President, Chairman, Board of Directors, etc. In essence, most corporations are divided into “Shares”. The Articles of Incorporation or Bylaws of the Corporation will declare the shareholders and to what amount of shares are entitled to each party member. For instance, one corporation could contain countless numbers of shares but the three Corporation representatives (President, Vice President, Chairman for example) may agree in the Bylaws to the Corporation being divided as 50% for the President, 25% for the Vice President and, of course, the remaining 25% for the Chairman. Any goods, deeds, cars, phones, properties, homes, etc that are in that Corporation are split equally by the divisions of 50%, 25% and 25%. It is possible to have only one person in a corporation just as it is easy to have 15 members in a corporation. There are certain other advantages of using a Corporation in Costa Rica. Most will use a corporation when transferring the ownership of one property to another. In Costa Rica, there exists a fee for sending a deed to a property to the public registry for transfer but there isn’t a fee for transferring the shares of one corporation, containing that property, to another. In this event, most investors save themselves the cost of transfer which, depending on the amount of property, can cost hundreds of dollars. The transferring of shares from one corporation to another is completely legal, recognized, practiced and preferred in Costa Rica. Too, you may find it difficult to open a bank account in Costa Rica or obtaining a telephone because each is very difficult without your residency card. However, a corporation has no problem obtaining a cell phone or bank account and this is how most bank accounts and cell phones are acquired. It is true that in some banks in Costa Rica they require your corporation to be at least 6 months old to open a new account. Most Attorneys have numerous corporations formed and ready to sell. Most corporations are under $1000 (U.S.) If you’re interested in a corporation at least 6 months old these may cost you a little more.
Do I need an Attorney in Costa Rica or can I use my attorney from my home country?
Some would say that you can never have enough attorneys. However, we firmly believe that having local representation is a must! The legal proceedings in Costa Rica are definitely unique to Costa Rica. To have a local Attorney will be an invaluable asset. Not to mention the language issue. Even if you speak Spanish fluently, legal Spanish is a whole new ball game. Most contracts here are done in Spanish but translated equivalents can be provided by your attorney. Don’t be afraid to shop around for an attorney. Ask for references. If you’re using your attorney solely for Real Estate, then make sure the attorney specializes in Real Estate transactions or at least has some experience. Most of all be sure that you can communicate with the attorney and that you feel comfortable using his/her services.
What is a Hectare? How do you convert that to feet and acres?
A Hectare is a unit of measure used in Costa Rica. Simply, a hectare is approximately 2.5 Acres. If you’d really like to break it down, a Hectare is 10,000 m2. There are approximately 11 ft2 in 1 m2…so, there is approximately 110,000ft2 in a Hectare.
Are there any limitations or regulations for building?
For the most part, each region and, potentially, each piece of property may have its own stipulations and regulations for building. Most of these stipulations govern the construction of buildings over 3 stories tall. 80% of people investing in Costa Rica tend to settle with a two-story home or its equivalent, but to those looking to build Condominium or neighborhood and gated community projects; you’d want to discuss any possible limitations with your attorney and your architect. Also, you will find specific restrictions with Right of Possession and Concession land (Land within the first 200 meters of shoreline).
If I purchase property in Costa Rica do I own it forever?
You do own the property forever if the property is “Titled” property. Most the property you encounter will be fully-titled, meaning that the land deed will be signed over to you in full allowing you to develop, sell, rent, trade or will the property to your next generation.
What are the laws that pertain to the purchasing of land on the coasts? Are there any other rules and regulations I should know about?
The laws pertaining to the coastal shores of Costa Rica are very specific and convoluted. It is our advice that you fully understand all aspects of coastal land before purchasing. With a good attorney, most of the buying process can be handled. For specific information, please refer to our “Buying Property in Costa Rica” article.
What are Squatters and how do I make sure there are none on my land?
Squatters are people who find a nice little place for a farmstead or home for themselves on land that they do not own. The problem arises when their presence is found and they have certain legal rights to obtain that piece of land due to the improvements made on the land (i.e. garden, home, small farm, livestock, coral). Squatters are legally recognized by the Costa Rican government because it is a law that dates back to the times when common stakes for land were common and routine. The theory states that a person can really only make use of so much land. So, if another family moved to the opposite end of a 500 acre farm, that family had rights to their home and livelihood. In present times do squatters exist? Yes, they certainly do but present laws and awareness have made it very difficult for squatters to possess land. By law, a squatter must occupy land under the pretenses that no one else owns the land. A sure way to settle this matter is to put up a fence around the perimeter of your property. It’s difficult to believe that the property belongs to no one when the potential squatters have to cross a fence. The law also states that the squatters must be notified of their eviction within 90 days. Most investors find a friendly neighbor, caretaker or renter to look after the property if the property will be left unattended for long periods of time. There are companies such as Stewart Title who offer Squatter’s Insurance to protect against this type of situation. All in all, it is good to know that the property doesn’t contain squatters but, too, it is a fairly simple thing to keep your property clear of Squatters.
Why is Costa Rica a good place to invest or live?
There are several opinions on what makes Costa Rica a great place to visit, invest and live. Yours will be the best one. Many will answer it’s the laid back lifestyle and pace of things. Others will tell you that it’s because Real Estate in Costa Rica is “Booming”. Some will tell you that because of low taxes it is appealing. The absolute natural beauty of the country is an obvious answer. The best advice is to form your own opinion. Spend some time here and find out what makes Costa Rica such a wonderful place for you.
How difficult is it to obtain residency or citizenship?
The Costa Rican government has focused their immigration department to aid those in retirement. If an individual with a fixed income would like residency in Costa Rica, the forms and procedures are pretty straight forward. With the assistance of an attorney, you can process this paperwork with ease. If you are not on a fixed income or are attempting to work in Costa Rica then the government makes things very difficult for you. There are companies who specialize in Immigration law in Costa Rica and they each have their strengths. Research them well. It is common practice for foreigners in Costa Rica to exit the country to either Panama or Nicaragua before the expiration of their 90 day Visa. By Costa Rican law, if you exit the country for at least three days you may be allowed to re-enter the country and will have successfully renewed your 90 day Visa.
Do you suggest I use the services of an Escrow company?
Although it is not mandatory to use and Escrow company for purchasing your property, it is highly recommended. The nominal fee for these services can’t be bickered over considering the overall protection that you receive. And, most Escrow companies have conducted thousands and thousands of real estate transactions. They are true professionals. In Costa Rica, we suggest Stewart Title.
How does Title insurance work?
Title insurance is offered to ensure that the property in question has no liens or financial encumbrances. In Costa Rica when you purchase a property you inherit all aspects of that property. For example, if a property was ever used for a financial loan in the past and the mortgage has yet to be paid, you, as the new proprietor of that land, would inherit that mortgage. Good attorneys will automatically research a title for you to ensure the property is clear and available to sell. If not, feel comfort that escrow companies, such as Stewart Title, can do the background check for you. To most, this step of the negotiation seems basic but there have been instances when a property wasn’t properly researched and issues have been inherited. What happens if you find that the property you are interested in DOES contain financial liens? Your attorney should include a clause in the contract that the sum owed be paid from the monies given as the selling price for the property. Again, a good attorney will instruct you on all of these matters.
Do most properties come with electricity and water?
Most properties with homes will have electricity and water. However, most lots or small farms that are purchased do not have electricity OR water. Nearly every property you come upon will need to have a well dug somewhere on the property. Some larger farms can use one well to feed many lots… it all depends on the layout of the property. There are certain seasons to dig for a well and not dig for a well. You want to make sure you hit your “True” water source. Any well digging professional can easily advise you on finding water. As for electricity, you need to provide your own wire (and quite often, poles) to your property. Having a power source near a property can save a lot of time and money.
How do you obtain electricity and water and how much does it usually cost?
If you’re providing power down a public road, the government requires that you place a pole every 50 meters (160 ft)… you can guesstimate that cost to be about $1000 per pole. It’s really important to pay special attention to local power points when looking for property… you can really save yourself a bundle. A well’s cost can range anywhere from $1,500 to $10,000, depending on how deep the well needs to be to reach water.
Why are there so many realtors in Costa Rica? Is there any type of licensing?
If you’ve traveled through Costa Rica then you’ve probably noticed that every waitress, desk clerk, hotel maintenance worker and taxi driver are trying to sell you property. It is true that in Costa Rica there are no licensing requirements whatsoever. This does make it very difficult as a customer interested in Real Estate!! So, who do you trust? It’s easy to go for the names you know and trust. Nearly every large Real Estate Company has some sort of representation in nearly every city of Costa Rica. That’s not to say that the small, independent companies don’t have their fair share of properties, either. The reality is you really need to meet a person that you trust. Stick with someone you feel comfortable with and make sure it sounds like they know what they’re talking about. There are definitely horror stories on both ends. The more researched you are on realty in Costa Rica the better off you will be.
Are there advantages to owning property on a Public Road? Any disadvantages?
We should really make a calendar of “Public Roads of Costa Rica” because many of them aren’t roads at all. In fact, many public roads dead end into mountains and rivers and are just waiting for some one to revive them and bring them back to use. What is considered a “road” here doesn’t necessarily have to be. But, according to Costa Rican law, if you have property touching a public road you have the advantage of splitting up your land into as small a lots as you’d like. In accordance with this law, Condominiums are ONLY allowed to be built on a public road. Don’t plan to buy a mountain, create a private access and build condos. It’s against the law. If the bottom of your mountain property touches a public road then you can put condos wherever you’d like. Condominium projects are excellent developments and have a huge return. Therefore, land on a public road tends to be very sought after. The only disadvantage of a public road would be the fact that you can’t build within 5 meters (16ft) of the public road and you may encounter a large amount of traffic because it is a public road. I suppose that could be an advantage, too, depending on your situation.
If I own a lot, can I divide it up to sell again?
Yes! You absolutely can! In fact, it is a very common practice. There are a couple of stipulations, though. If the land that you own doesn’t connect to a public road then the smallest you can divide your land is in 5000m2 lots (approximately 1 acre). If your property is connected to a public road you can divide your property in to lots of any size. When planning a large development, make sure to keep in mind things like roads, drainage for the roads, water supply and power. Proper planning can eventually save you time and money!
Are there any Capital Gains taxes in Costa Rica?
Currently there are no capital gains taxes in Costa Rica. Capital Gains taxes are taxes on monies earned above and beyond the buying price of your land… i.e. profit. When you purchase a piece of land for (example) $100,000 and you sell that property two months later for $150,000, you will not be taxed separately as Capital Gains. However, there are several tax laws and regulations that you should understand both in Costa Rica and your home country.
Are there regulations against tearing down trees and destroying rainforests, rivers and wildlife?
Costa Rica realizes that the heart and soul of their tourist industry relies on the natural beauty and wonder of Costa Rica. The wildlife in this country is so special and so diverse that it is mind blowing. To preserve this beauty for generations to come, the government of Costa Rica has implemented many laws to protect the habitat and the wildlife. Here are some examples of those laws. If there is any type of running water on the property; know that you cannot build within 15 meters from either side. Too, there are certain trees that exist in Costa Rica that are protected, such as the Pochete tree and the Guanacaste tree. These trees are very important to the ecology of Costa Rica and cannot be molested or destroyed for any reason. Mostly, they are loved habitat for the monkeys, birds, lizards and other animals that inhabit the country.
Do I need to speak Spanish to buy land in Costa Rica?
Of course you don’t have to speak Spanish to purchase land in Costa Rica. A difference in language can be a pretty intimidating thing, especially when you’re conducting business of this magnitude. The important thing is to be surrounded by those you trust who are bi-lingual to assist you. Easily found are attorneys. Most attorneys are bi-lingual and can really assist you through the processes. A bi-lingual realtor will also be a large help. All in all you’ll find that now a large number of Ticos are picking up the English language with some incredible proficiency. Hopefully, you’ll find that one of the incredible parts about living in Costa Rica is learning and using another language! It’s a challenge but it should be a fun one!
Is there financing for those investing from other countries?
Most of the transactions that occur in Costa Rica are cash transactions. And by “cash”, we’re referring to wire transfers. Most money is wired into an escrow account of some sort. Once the money is in the country, then the escrow company will transfer the funds to their appropriate destinations. If a foreign investor is looking to have financing, it is provided by Stewart Title of Costa Rica. I believe the interest rate is approximately 9%. You would need to contact Stewart Title and ask for more information on their financing options.
Costa Rica now boasts a thriving real estate market today and investors are taking this opportunity to invest and find quick returns on real estate in a time when the U.S. economy is failing. The economic problems in the United States seem to show little effect on the market in Costa Rica, and the country continues to see a real estate and economic boom that has astounded many.
Costa Rica has recent shown itself to be the investors’ paradise and a great place for those wanting to invest in their own piece of paradise. Regardless of the falling economy in the United States, the real estate market in Costa Rica is flourishing; in fact, such a real estate boom has not been seen abroad in some time. Not only is the market thriving, but as Costa Rica continues to be an extremely popular tourist destination, more and more people are considering investments in this Central American country. Even though the prices are on the rise, investors and retirees alike now have the chance to cash in on this gold mine of economic prosperity.
The real estate market, and even the entire U.S. economy is struggling right now, leading to serious real estate investors looking for opportunities for investing abroad, since the U.S. real estate market appears to be so shaky. While some may think that the serious decline in the United States would affect the real estate boom in Costa Rica, no such thing has occurred, with prices continuing to soar and the market continuing to rise on in this small country unaffected. For those looking for an investment paradise to sink their money in abroad, Costa Rica has truly become their investment paradise, with prices continuing to climb, bringing investors excellent profits.
Of course not only does Costa Rica offer great gain to investors, but a tropical paradise with reasonable prices to vacationers and retirees. In fact, various retirees from countries around the world are choosing this country as a place for retirement as they see that the investment is well worth it and better then opportunities offered in their own countries.
To learn more about the thriving Costa Rica real estate, investment opportunities, and more, visit www.gapinvestors.com
Costa Rica has recently caught many eyes as a hot tourist spot but also as a great place to purchase real estate. With so much public attention and a vast number of tourists visiting Costa Rica every year, the country offers a great investment environment for real estate. Below are seven great reasons to invest in Costa Rica Real Estate.
1. Stable Government:
Costa Rica is a democratic republic with three branches of government and has enjoyed one of the most democratic governments in Latin America. As of 1948, Costa Rica abolished it’s army and since 1949 has enjoyed its peaceful democratic existence, often being referred to as the “Switzerland of Central America”. The government is one of the people and one that very much sees the value of tourism. Over the past few years the government has incentivized foreigners to come and retire in Costa Rica. Stable government ensures that the money you put into your property is safe. Political turmoil will never be a reason for illiquidity in your Costa Rican investment and also provides reason why Costa Rica is a great place to buy. There are many other locations around the world that investors think of to go and buy, but stability is very important and should play a huge factor in anyone’s investment decisions.
2. Stable Currency:
Investors want to know if their money is safe in Costa Rica
Stability of the government has helped to maintain a solid and stable currency.
The Costa Rican colon, also denoted as CRC is the official currency of Costa Rica. (Currently $1 USD = 516.245 CRC). Colones come in notes of 1,000 up to 10,000.
US Dollars are also accepted as legal tender in Costa Rica. Both are widely accepted and exchanged throughout the country with approximately 90% of the places of business in the country accepting the US Dollar.
3. Tax Incentives:
This seems to be the one everyone loves! As mentioned earlier the Costa Rican government has created one of the most attractive investment environments in Latin America.
Capital Gains Tax= 0% in Costa Rica. The capital gains taxes are exempt for a business if the money is derived from an activity that is not the normal course of business for the company (This exemption is established through the use of SA, or Sociedad Anonima). Property Taxes in Costa Rica = .25%. This rate is significantly lower than most places in the world. As a result people are buying in Costa Rica which increases demand and ultimately increases value. There are not many places where you can buy a piece of property that has incredible appreciation potential with such low holding costs.
Corporate Tax: The Sociedad Anonima (S.A.)
These forms of corporate structures allow owners of property to keep their names away from the corporations they own (literally translates as “anonymous society”). Ninety percent of all property in Costa Rica is purchased through these S.A.’s. When a property owner purchases property through these S.A.’s they use a shareholder’s loan to fund the purchase. Rental income generated is taken out of the corporation as dividend income and deducted against the initial investment and thus no taxes are paid.
Income Tax: Only income generated in Costa Rica is subject to income tax
Costa Rica offers large amounts of income to be deductible and free from any tax
**all tax information should be verified by independent tax professionals **
4. Proximity to Major U.S. Cities:
When investigating vacation destinations and environments for second homes or investment property, it is important to factor travel times to the destination. Costa Rica’s proximity to major US Cities gives even more reason why investors are buying property in Costa Rica. Great tourist destinations need to be close and easily accessible.
Major US Carriers offer direct flights to and from Costa Rica from the following international airports (3-5 hour flight times)
-Miami
-Houston
-Atlanta
-Dallas
-Chicago
-New York
-Los Angeles
-Toronto
5. Healthy Local Economy:
For baby boomers and entrepreneurs, spiraling costs of living abroad, oppressive taxes and government regulation in the US have placed Costa Rica high atop the list of places to retire without sacrificing standard of living. This is what savvy investors are looking for!
6. No Ownership Restrictions:
Foreign Ownership is promoted in the country of Costa Rica. In many foreign countries fee simple title is only available to locals and without titled ownership your investments can be at great risk. All foreigners enjoy the same rights as Costa Ricans when it comes to real estate ownership. Titled, fee simple properties are all registered in the National Registry of Costa Rica properly protecting your ownership rights.
7. Excellent Lending market:
Prior to 2006, there was no market for lending in Costa Rica and investors bought and sold property on a cash basis. With the recent surge by worldwide and US lenders as well as the strengthening of the Costa Rican market, financing at reasonable rates is now an available option. This addition to the real estate industry has made it possible for many more investors to buy property in Costa Rica and will only increase the demand over time.
As you can see there are many great reasons to invest in Costa Rica. Many people believe that it is too late to make any money. This is not the case! The time is now to invest in this beautiful country and incredible vacation spot.
