Costa Rica Real Estate For Sale
If you’re looking for Costa Rica real estate for sale, you’ve come to the right place. Here are a few things to know about property ownership rights and closing costs. KRAIN is the only company in Costa Rica with global real estate marketing affiliations. Its marketing reach stretches to 132 countries and 18 languages.
Property ownership rights are preferable in Costa Rica
Foreigners can own property in Costa Rica under the Fee Simple regime. This type of ownership confers full rights to use, sell, lease, and improve the property. This type of ownership is preferable over the more restrictive condominium regimes. The only drawback is that foreigners may not be able to sell their property until 15 years have elapsed.
Foreigners may choose to purchase titled property in Costa Rica in their own name or through a Costa Rican corporation. This will allow them to limit their liability to the property. In addition, Costa Rican law recognizes corporations as separate legal entities and the “corporate veil” is respected.
If you own a property in Costa Rica, it’s important to register it with the National Registry. The National Registry maintains public records, which include property ownership and parcel information. Once you register your property, you must appear before a Notary Public, who will issue you a public conveyance deed. You will have to present this deed to the National Registry, where you can ensure your property ownership rights.
In Costa Rica, real estate taxes are based on the value of the property, and the owner must update the value every five years. Tax payments must be made before the tax year ends, which is January 31. In addition, the Costa Rican government expects homeowners to pay the taxes themselves, although a tax attorney can help homeowners check the information on their forms.
Property owners must pay their property tax to the municipality in person. Some municipalities have online systems, but most prefer personal payments. Luxury homes are also subject to an annual luxury home tax, which must be paid to the Tax Authorities. Unless you speak Spanish or are a computer geek, you may find the process difficult, but the Tax Authorities website can help you understand the process.
In addition to assessing the market value of a property, buyers and sellers must consider the tax implications. The real estate tax in Costa Rica is not very high. A $200k home, for example, will only be taxed for $500 annually. Another important thing to know about Costa Rica real estate taxes is that the government does not tax capital gains. In most cases, selling a property results in a gain of its original value plus the amount of appreciation. However, the National Legislature is considering imposing a capital gains tax, but no one knows when or by what percentage. For now, real estate professionals are reassuring buyers and sellers that any tax they incur would be reasonable.
When buying a property in Costa Rica, you must be prepared to pay closing costs, which can range from $20 to $100. As a foreign buyer, it can be intimidating to navigate the unfamiliar legal system and the financial implications of such a purchase. In Costa Rica, closing costs are generally higher than in the United States and Canada. These expenses are the result of the way Costa Rica collects taxes. While annual property taxes are low, transfer taxes are much higher.
Closing costs in Costa Rica real estate are almost always calculated as a percentage of the final property price. These costs include transfer taxes and stamp fees. The former are paid to the Costa Rican government, while the latter are paid directly to the National Registry.