How to Buy Real Estate in Costa Rica

Buying real estate in Costa Rica is pretty parallel to how you would do it in your home country, with a
few differences.

 

1.) Find a property you love. To do so, look on local websites rather than just doing a scattershot online search. There is no MLS in Costa Rica, so listings get shared around and some agencies are better at keeping their websites up to date. Instead of “Real Estate in Costa Rica” try something like “Real Estate Agency in (name of town or region). Hint: You will always do better by selecting one agent in the area of interest and sending any interesting listings you find to that agent. Otherwise, you’ll waste time on expired listings, overlapping listings, and listings that haven’t been updated.

2.) Make an offer that works for you. It is very hard to find “comparables” in our markets, so pricing is plus or minus. Assume there will be some negotiating with the Seller in order to arrive at a price acceptable to both of you.

3.) If you reach an agreement, your offer will be formally turned into a Sales and Purchase Agreement. If you are from North America, you might think of this as the “Earnest Money Contract” that your agent would do for you as part of their service, but here an attorney does it and you pay for it.

4.) While these things are happening, you will need to open an Escrow account. This is probably the hardest part of the process for new Buyers to understand. In order to comply with money laundering laws, the escrow company is obligated to gather a “ridiculous” amount of information about your finances. The whole point is to be very sure that you are legit and the source of your funds is legit. It’s just something that you have to do, so meditate for 30 minutes, take a deep breath, and walk through it step by step.

5.) You may also want to have your attorney create a Costa Rican corporation to “own” the property for you. This has advantages in terms of liability, so it’s something you should at least discuss. It only takes a week to ten days to do this, so it is easily finished by the time you go to closing if you start early.

6.) Once your SPA has been signed by both parties, you will typically send a 10% deposit to your Escrow Company. That triggers the Due Diligence period.

7.) Due Diligence will be coordinated by your attorney and done by several people that may include surveyor, home inspector, agent, municipality and others. It needs to be done well, and if you decide not to do parts of it, you should do so with your eyes wide open. At the end of the Due Diligence, you will be given a report that allows you the opportunity to accept the results or reject any part of them. If there is a “fatal flaw,” you can simply withdraw from the deal and get your deposit back.

8.) If you accept the Due Diligence, your deposit will go hard (nonrefundable) and you will send the balance of your payment to your escrow company. Then you will close within a few days and your property will be recorded in your name in the National Registry.

9.) Once you own the property, it would be wise to make sure you understand what your obligations are and how to fulfill them. Write down how to pay your utilities and taxes, and make sure you understand how much, when, and how to pay your corporation taxes. You may need to set up a bank account to make this simpler, especially if you will not be living at your property full time.

 

That’s it! Follow the steps and you will end up with peace of mind about a beautiful property.

Buying Beach Property in Costa Rica

With one exception, foreigners can buy property in Costa Rica with the same rights and obligations as Costa Rican citizens. The exception is in the Maritime Zone.

Along the coasts and any portion of a river that is affected by tides, the first 200 meters of land is owned by the government and cannot be owned by anyone else. (There are a few small exceptions that were grandfathered in as titled land.)

The first 50 meters may not be developed. They are for public use. The next 150 meters are usually available for development if you get a long term use permit, or “concession.”

You get a new concession by hunting for a property that doesn’t already have one. Of course, such properties are hard to find now, but if you get lucky, you can apply for a concession at the appropriate municipality. This is best done by an attorney who specializes in such things because it can be tedious and complicated. In the process, you have to specify what you are going to do with it. Private residence? Hotel? Restaurant? Resort?

One very important difference between the Maritime Zone and titled land is that no foreigner can hold the controlling interest in any property in the Maritime Zone until that foreigner has had legal residency in Costa Rica for at least 5 years. Until then, at least 51% must be held by a Costa Rican citizen.

Obstacles to getting a concession would mainly be environmental. Any areas that are wetlands or have mangroves growing on them are automatically off-limits. Other areas might have forests or wildlife that can’t be cleared or disturbed. Some users might be rejected if they don’t fit with the municipalities’ zoning plans.

In response to your application, the municipality will either deny the concession or approve it. If they approve it, it will be valid for 20 years and they will attach a value to the proposed development of the property so they can levy an annual use tax, known as the “canon.” That would be in lieu of a property tax but can be quite a lot higher because it is a specialized property.

Once you have a concession, you have 2 years to do the development or lose the concession. If you do the development, pay your canon as required, and do not violate any of the laws or restrictions on the property, renewal should be straightforward as long as you do it on time.

Those are the basics for getting a new concession. Realistically, however, you would most likely be buying a concession that is already established, rather than starting from scratch. So how does that work?

Until you have been a legal resident for 5 years, assume you will be buying shares in a corporation in which you are not a majority shareholder. When you buy the concession, the appropriate number of shares will be transferred to you. That is something you need to check thoroughly so you are comfortable with the arrangement. A good lawyer can help you sort it out.

If you are buying undeveloped land, you need to know what use and value the concession permitted because a) you will need to build that and b) your canon will reflect that. If you don’t build on time, you can lose your concession.

If you are buying an existing business or home, you need to make sure all of the laws and restrictions have been followed. There have been cases of homes being bulldozed or businesses being shuttered because laws were broken or the concession’s requirements weren’t followed. For example, if a wall or pool infringes on the 50-meter restricted zone, you could be required at some point to remove it!

In summary, there are extra concerns to research when you buy concession property here. Do your homework. There are some great concession properties available for purchase, and there are some that will pretty much be a series of migraine headaches. Don’t ever let an agent fast-talk you into thinking “It will all work out.”

Do the Due Diligence and hire someone who specializes in concessions to protect you. If you do that, you could end up with one of the most desirable properties in the country. If you don’t do that, you could end up with nothing but regrets.

Where to Eat in Dominical, Costa Rica

Whether you are looking for things to do in Costa Ballena or looking to purchase real estate in Southern Costa Rica, within a few hours you’re going to be looking for a place to eat.
In the Southern zone, once you leave the Quepos area heading south, the first sizable community you come to is Dominical, about 45 minutes south on the coastal highway. That’s not to minimize the smaller communities along the way, but to say that when you hit Dominical your options for activities to try, places to stay, and things to eat increase dramatically.
Even before you get to town, look left in Matapalo for Langosta Feliz right beside the highway. It has some of the best seafood in the area. In Dominical itself, there are about 16 restaurants varying from a back-of-the-grocery-story delicatessen to a Mexican fusion kind of place on the
beach.
Dominical is pretty easy to navigate, with only one main street, so you’ll see options just by cruising through town. In case you wants some ideas of what to look for, watch for these:
For specialty foods, consider Sol Frozen Yoghurt (desserts), Phat Noodle (Asian noodle fusion), Mono Congo (Drinks, Bakery, Cool Stuff), Sushi, Pescado Loco (fish tacos) and Del Mar Taco (Tacos, burritos), La Casita Pizza, Mama Toucans (deli sandwichs and salads), Fuego’s (Microbrewery and restaurant) and Tortilla Flats (Mexican fusion plus).
For places that offer a bit of everything, from steaks to seafood to typical Costa Rican dishes, check out Villas Rio Mar, Su Raza, Diuwak, Coco’s and Maracatú. To get a more authentic Costa Rican experience, don’t overlook the little “Sodas” along the
way. Sodas are hole-in-the-wall places to eat. Tucked into nooks and crannies, they offer Costa Rican food that often rivals anything you’d get at the fancier places.
Don’t know what to order?
Try a “casado”. You’ll have a choice of meats and the dish will come with rice, black beans, salad, and maybe fried plantains. It often includes a fruit drink too, making it one of the most filling, economical dishes around.
South of Dominical there are a couple other worthy mentions. Por Que No has a different kind of menu that’s popular as well as a killer view of ocean waves breaking on rock formations (make a reservation in high season). La Parcela sits on a finger of land so you can see ocean breakers on both sides. Villas Alturas has such a fantastic view that you won’t care what you’re eating. And Cuna del Angel’s menu is classy and gluten free.
Much more could be written, and has been, about dining out in Costa Rica. So just a few
reminders:
You can drink the water. Costa Rica has done a very good job of ensuring water quality around the country. We rarely hear complaints about stomach problems, and when we do, we doubt that it was the water. Portions are often generous. We keep our own “take home” containers in our car to save on single use plastic or Styrofoam when we want to keep some for another meal. You might consider that too. We even have our own stainless steel straws. Every little bit helps.
Fruit smoothies are the elixir of the gods here. If you don’t like them too sweet, don’t forget to mention “no sugar.” Usually the fresh fruits used in the smoothies are sweet enough by themselves.
Tipping is confusing. Check your bill at fancier restaurants and you’ll see that a 10% (minimum) service charge has already been added. So do you add more of a tip yourself? It’s up to you. Most Costa Ricans do not tip any more than what’s on the bill. Many foreigners do so out of
habit. You do what you are comfortable with.
Finally, enjoy the culinary adventure and interact with the people who cook for you and serve you. Food is embedded in culture, so your appreciation for “their” food automatically translates into your appreciation for “them”.

Earthquakes in Costa Rica.

By Ron Snell.

When we’re showing properties to people who want to buy real estate in Costa Rica, sooner or later an inevitable question comes up: “Are there earthquakes here?”

The short answer is, “Yes.” But there’s a much longer answer because the real question is, “Do I need to worry about earthquakes in Costa Rica?” And the short answer to that is “No.”
Costa Rica, and therefore every property in Costa Rica, is on the “Ring of Fire.” Take a second to Google “Ring of Fire map” and you will see images of a map with a bright red line that runs right down the western side of the western hemisphere, including Costa Rica.

There are a few good things to point out here:

First, that’s part of what makes Costa Rica topography so amazing. It’s why I’m writing this in a home near Dominical that’s 1,100 feet above sea level but I can see and hear the surf. A long time ago some massive plates under the sea starting pushing toward each other just like if you and a friend put your hands on a rug from opposite ends and pushed toward each other. Do it slowly and you can watch a mountain range push up between you. Put some luxury homes on one side of that mountain range and you have… voilá… the Southern Pacific Coast of Costa Rica!

Every once in a while those plates still get a little uncomfortable and need to move a bit.

When they do, we feel a gentle shake that simply reminds us we are on active earth that supports our beautiful forests and animals and homes. We feel those shakes every few weeks, usually so slight that we aren’t sure if it’s something we did or something the earth did. Once in a while they are a little more powerful and we can hear a little clinking of wine glasses or see a bit of jiggle, but that’s not common.

Second, our soils don’t liquefy in an earthquake. When you buy land, you will be required to get a soil test done before you can get a building permit. In our area, I’ve never heard of a building project being rejected because of a bad soil sample unless it’s due to uncompacted fill or accumulated rubbish in the soil).

In other parts of the world, soils are the opposite of that magic mud you made as a kid.
Remember how you suspended cornstarch in water? When it was just resting or moving slowly, it was like a liquid. When you slapped it, it was hard. Those nasty soils in other parts of the world, on the other hand, are solid when they are stationary, but turn liquid when they are shaken, causing a lot of damage. Ours aren’t like that, so earthquakes don’t affect their
supportive strength.

Third, Costa Rica is picky about construction, and especially foundations. When I was a real
estate broker in Texas, it was unusual to show a house that didn’t have at least a little cracking because of movement in the foundation.

Here in Costa Rica, I can show you 50 homes in a row with no structural cracking (we might notice some hairline surface cracking of the exterior plaster, but it’s cosmetic rather than structural).

Before you can build here, you have to submit your plans to the College of Architects and
Engineers. They go over the plans with sharp eyes to make sure there is enough concrete and reinforcing bars. When they put their stamp on the plans, you can be sure that your home will be well built because your architect or engineer is responsible to visit the project regularly and ensure that it is built according to the plans.

So that’s my longer answer to two questions: Do we have earthquakes here? Yes. Do we worry about them? No.

If There’s So Much Water, Why is There No Water?

I’m writing this in February, a very dry month in Costa Rica. It’s “summer” here, which is what
they call December through April because there is so little rain and the temperatures are a bit
higher.

For the rest of the year, there is rain. During a typical cycle, rains start in April and are pretty
tame until August. They usually get themselves organized later in the day, rinse off all the dust,
bring the wildlife to life.

From September through November, rains are the main events. The whole world gushes under
a daily deluge. Thunder and lighting provide celestial spectacles. Creeks and rivers rise, springs
spring, trickles turn into waterfalls, and frogs all think they’ve died and jumped to paradise!
According to Karl Kahler, writing in the Tico Times on October 3, 2015, if you total it all up,
“Costa Rica receives enough rain to supply an average of 22,000 gallons to each of its 5.1
million inhabitants every day. That’s a lot of water — enough to supply every person on the
planet with 15 gallons of water a day, year-round.”
So why is water such a big deal? Because the collection and distribution of the water has to be
managed, or it all ends up in the ocean where it doesn’t do you much good when you want to
brush your teeth at night.

For many years the laws have stated that for residential purposes, it’s not enough to just have
water. It has to be “authorized” water. There are only three sources of authorized water: 1. The
federal government’s AyA* water system, available mostly in cities and towns; 2. A registered
neighborhood or community ASADA** water system, available in many rural communities; 3. A
legally obtained concession allowing you to use a spring, creek, well, or river for your water
source.
The law has been that without one of those three sources of water, you cannot get a building
permit. Unfortunately, this law hasn’t been enforced with any regularity and many building
permits were granted without authorized water. Many people bought land with the
expectation that water wouldn’t be an issue when the time came to build.

Oooops. In the past few years, the first one municipality, then another, then another began to crack
down and enforce the law. They began to demand documentation before issuing a permit.
Imagine the irony: This has left many land owners huddled under big umbrellas by roaring
creeks in gushing rains unable to sell their land or build because they have no authorized water.
There is a lot more that could be said about this. It remains to be seen how it will all get
resolved, because many people are affected: owners, attorneys who specialize in real estate,

municipalities that lose revenue from building permits, architects, contractors, and of course
real estate agents.
In the meantime, be aware of the issue. If you are looking at buying undeveloped land, always
ask, “What about the water situation?” If the answer is that the property has water, ask for
documentation before you make an offer, because having water isn’t the same thing as having
water rights, right?
If the answer is that the water authorization is in the process, be skeptical about promises
regarding the timing. It can take two years to get a concession, and sometimes more to hook up
to an existing system if the property you are looking at wasn’t included as part of the system.
The one answer you should never accept is, “Don’t worry about it; it will all work out.” That was
true for many years, but it is no longer a good answer. No trustworthy agent these days will
encourage you to move forward on the basis of “thoughts and prayers” when it comes to water
rights.

In the meantime, consider coming to see Costa Rica during the heavy rainy season,
euphemistically referred to here as “green season” as opposed to “the season when sometimes
you can’t tell if that’s rain or if someone is emptying their pool on your head.”
We who live here love the rains. So do the flora and fauna, and so will you.
*AyA is short for Instituto Costarricense de Acueductos y Alcantarillados, roughly meaning “Costa Rican Institute for water
delivery and sewers.”
**ASADA is short for Asociaciones Administradoras de Los Sistemas de Acueductos y Alcantarillados, roughly translated as
“administrative associations for water delivery and sewers.”

-By Ron Snell.

Where on Earth Does the Sun Set?

-By Ron Snell

I just finished showing some clients a few beautiful luxury homes with stellar views of the
Pacific Ocean. Those were Wow! moments, soul filling in the literal sense where you suddenly
realize you haven’t been breathing normally.

Always when looking at that view, the question comes up: “So where does the sun actually
set?” Because the only thing more beautiful than the ocean in all of its moods is a blazing
sunset where you can watch a glowing red ball sizzle right into the water way out there on the
horizon, and you can picture a long, narrow burning path reflected across the water coming
right to your feet, and the clouds flash brilliant colors, and you wear out your Instagram or
Facebook followers with picture after picture of it all.

Back to reality. Astronomical reality. Where, really, on that beautiful horizon, does the sun set?
How much of the year can you actually watch the sun sink into the ocean as it wraps up the
day? Can you believe the property description, your agent, or the homeowner?

Three things complicate the answer:

First, our coastline doesn’t generally run north and south. If you are standing square to the
coastline and looking at the Pacific Ocean, you are tempted to think you are looking west, and
since the sun “sets in the west, well….” Usually, you aren’t. You’re looking southwest, and the
sun will mostly set to your right.

Second, the sunsets travel a lot between December 21, when they are the farthest left (south)
they will go, and June 21, when they are the farthest right (north) they will go. I won’t explain
the astronomy behind this, but you can Google it and spend a fascinating hour refreshing your
memory about things you were supposed to learn in earth science about 50 years ago.

Third, it’s highly unlikely that your agent has ever actually stood on the property both June 21 st
and December 21 st and marked where exactly the sun sets. Instead, it is highly likely that the
agent has heard the owner say, “You can watch the sunsets over the ocean” and has
immediately driven back to the office to include that in the property description.

So what are you to do? How do you know how often you’re going to see sunsets over the ocean
instead of behind the trees or an inconvenient mountain? It’s pretty easy, really.

Point a phone app or a compass due west. Because we are about 9 degrees north of the
equator, on December 21 st the sun will set about 23 degrees to the left (south) of west. On June
21 st it will set about 23 degrees to the right (north) of west.

No amount of fast talking by your agent will change that, so trust the science and set your
expectations. Keep in mind that from September to early December it isn’t going to matter a
whole lot anyway, because it is highly likely that there will be heavy overcast or rain that time
of day. So focus on late December through June. That’s when you are most likely to see the
sunsets.

If you are the sort of person who enjoys this stuff, you would like the app I found for my phone:
Sun Surveyor Lite. It’s free and shows you where the sun will set on any day of the year, among
many other things like times for sunrise and sunset.

By the way, if you’re a photographer, whether amateur or less amateur, this little app has some
very practical value because you can set up shots based on where the sun will actually be,
instead of where you wish it were going to be, any time of day.
Check it out.

Owner Financing In Costa Rica

Owner Financing In Costa Rica:

Owner financing is when the seller of the property finances the property with the
buyer, or entity acquiring it. When going the route of owner financing, you eliminate
bank fees and associated fees that come with buying a property in Costa Rica,
especially if you are a foreigner. If you have a good handle on real estate in Costa
Rica (like we do here at Dominical Real Estate) you will know the ins and outs and
the advantages of owner financing. During slow economic periods, owner financing
is strongly encouraged. Before experiencing the market slump, many Americans
paid cash for their properties. Since the bank charges much higher fees when
financing, many buyers opt for owner financing in Costa Rica because the fees are
substantially less.

Owner financing is a great option for buyers because they have the utmost
advantage in regards to the transaction. When looking at the terms and conditions
of the contract and finance agreement, the terms are more flexible. As the buyer, you
will pay the seller directly. This is a great option for buyers who have more liquidity.
Most owner financing deals are assisted by a promissory note that includes the
terms and interest rates, as well as the penalties of nonpayment.

Owner Financing in Costa Rica enables investors to buy, which might be the only
hope for some people to own real estate in Costa Rica. You are recommended to pay
off your seller within a 5-year timeframe to be fair. Many financers offer a longer
pay period in order to meet the needs of the buyer and he or she may be willing to
extend the period if the buyer has been consistent with their payments

Here at Dominical Real Estate, we offer owner financing on some of our properties
because we want to make your experience as easy and effortless as possible. We
believe in trust and our goal is to help people make the best investment and find the
best possible property here in Costa Rica for you to enjoy! Whether you choose
owner financing or you want to do everything through the bank that is up to you.
The option is out there and the advantages are in your favor.

One thing to note about owner financing is that the room for negotiating on the
property price is very small to obsolete. This is because the seller is agreeing to hold
your mortgage. The down payment all depends on the owner who is providing the
finances to you. Most owners will require a down payment of 50% of the property’s
value. Then the seller is agreeing to finance the remaining 50%. The average interest
rate is around 7% give or take.

If owner financing is not something you would consider, there are a few other
options we can speak with you about. We are here to find you a property in Costa
Rica that meets all your wants and needs. Don’t hesitate to contact us, as we are
always willing to share our knowledge about real estate in Costa Rica!

The Process Of Purchasing Real Estate In Costa Rica

The Process Of Purchasing Real Estate In Costa Rica

Can a foreigner obtain real estate in Costa Rica? Of course they can, and every foreigner has the same rights as a citizen in Costa Rica, excluding voting rights.

Since foreigners have the same rights as citizens when it comes to buying property; the government has made the process very simple. There are a few key factors you need to know in terms of where a foreigner can purchase real estate, and you will learn all about that in this article.

It is important to know that a foreigner cannot own 100% of the property if it is located in a Maritime Zone. Titled property is any piece of land that is beyond 200 meters from high tide. The first 50 meters from the high tide line, is public property that is protected. Within 150 meters adjacent to the high tide line- this is known as the Maritime Zone and the property can be leased from the government.  

Real Estate Attorney:

It’s essential to hire a real estate attorney and someone who is bilingual if you don’t speak Spanish. Hiring an attorney with experience will ensure no problems will arise with the property you want to purchase. They will look over everything and make sure the property is in good standing.   

A Good Real Estate Agent:

It doesn’t matter if you are buying property in Costa Rica or anywhere in the world; it’s always essential to use a good/reliable real estate agent. Choose a real estate agent who has been in the business for a few years and who is familiar with the area you want to invest in. Make sure they match all your requirements and they postulate outstanding service. It’s always good to stick with one agent and get to know them on a personal level. This will make the buying process that much easier.  If you are speaking to several different agents, you will get confused and you won’t have that hands-on experience that one agent is willing to provide you. With Dominical Real Estate, we ensure you have a positive experience from the first time we speak to you- to after you are settled into your property. Our agents go above and beyond to assist you with every possible need. We are only a call, text, or email away from finding you the property of your dreams.

Making An Offer:

You will want your real estate agent to write up an offer and deliver it to the seller instead of making a verbal offer. It is always better to have this information written down on paper. After the offer is accepted, your agent will have your real estate lawyer draft up a formal purchase of sale agreement. When both parties sign the agreement, you will be required to send 10% of the property price into an escrow account that you will need to set up. Once the 10% deposit is deposited into the escrow account- the agreement becomes lawful.

Closing:

Depending on whether you will be in Costa Rica during this process if for some reason you will not be- you should leave the power with your attorney, or real estate agent. They will be able to obtain the real estate property in the name that you approve of. You will need to have your property registered in your name or a corporation. Remember to always look at all the fees associated with your property. From utilities to condo fees, corporation tax, property tax, etc.

If you have any other questions regarding the process of purchasing real estate in Costa Rica, please don’t hesitate to reach out to me and I would be happy to answer any questions. I want to make this process as easy as possible for you and ensure you have a positive buying or selling experience with Dominical Real Estate! ☺

Why Buying Property In Costa Rica In 2019 Is A Good Investment? 

Why Buying Property In Costa Rica In 2019 Is A Good Investment? 

 

Let’s face it- Costa Ricans are some of the happiest people in the world, with Costa Rica being ranked as one of the happiest countries in the biosphere. Why wouldn’t someone want to buy property in Costa Rica with a classification like that?

Buying property anywhere in the world is typically a safe investment; nonetheless you want to look at places that will exploit your income in the long run. Deciding when to buy real estate and where, are usually the two big questions. When it comes to buying property in a foreign country for the first time, you want to take many factors into consideration and make sure you are aware of the process. Costa Rica is currently a buyers market and has been for a few years. There are many different places on the market, which allows you to be picky and find the perfect place. With the abundance of real estate on the market, come more affordable prices that make investing in real estate more cost efficient for foreigners. It’s always important to take your time and not make any decisions based on impulsiveness. A lot of people come to Costa Rica for the first time and distinguish they will be back for good. Take some time and experience the country a bit, once you see how scenic and tranquil it is, than make your purchase.

Let’s take a look at the different reasons as to why Costa Rica is a good investment for the upcoming year:

  • Minimal taxes
  • Growing tourism
  • Buyers market
  • A safe country
  • The market is down
  • Permanent Residency
  • The weather
  • The diversity in the country

Costa Rica is known for their minimal land tax. You have to pay 0.25% of the registered property value in your municipality. You have the option to pay this on a quarterly basis or one payment for the year. You will get a small tax break if you pay it all at once. In terms of the growing tourism here in Costa Rica, many people are coming to Costa Rica because of safety reasons and all the places to explore around the country. Costa Rica is an extremely safe country to travel around and to live and many female expats travel the whole country by themselves.  In the past 10 years, the tourism industry in Costa Rica has grown at a steady rate of approximately 8% each year. Tourism in the country generates about 13% of employment.

With the crash that happened in the real estate market in 2008, the market is still recovering. With that being said, prices of real estate are down, which makes this the perfect buying opportunity for anyone who wants to own a property or income property in Costa Rica. With the tourism rate growing at a fast 8% each year, the market will eventually stabilize and real estate will rise. The government is working to cultivate new areas of the country and continue with new highway development. A new international airport is suppose to develop in Orotina in 2025, which will compete with the hub of Central America in Panama.

Between the beautiful weather year around and the diversified landscapes spread out across the country, what better reason to invest in Costa Rica? There are beach properties close to the turtles and fishing ports, and there are properties in the rainforest, which are surrounded by monkeys and sloths. You have the choice to pick where you want to invest in Costa Rica. Also, after an investor invests over $200,000 they are granted temporary residency. Then they would wait three years and could opt for permanent residency or citizenship.

For any real estate questions pertaining to properties in Costa Rica, don’t hesitate to reach out to me, as I would be happy to assist you through out this journey! ☺

Guide to Importing a Car and Other Household Items into Costa Rica

Guide to Importing a Car and Other Household Items into Costa Rica – Written by Jason Mueller

frog

It’s understandable why anyone would want to move to Costa Rica. The country has a majestic landscape, exciting outdoor activities, low cost of living, favorable foreigner/expatriate policies and ample working opportunities. Costa Rica is however known for high import duties. Living in Costa Rica as a foreigner is easy. Moving is the main hurdle especially if you want to move with your car and personal belongings such as household items. To move seamlessly, there are several things you must know/understand.

Laws and regulations
Costa Rica’s Customs Law has several articles relating to the importation of used goods/items. Duty varies depending on several factors i.e. when and how you import the goods. Here’s an important criteria to consider.
Your household items are exempt from duty if; you are an adult who is importing the goods for personal use (not for sale). The items must also be used (at least 6 months old) and the importer must enter Costa Rica within three months (90 days) prior to custom clearance. If your shipment meets the above criteria, your household items will be exempt of duty. If you have new items, duty is based on CIF (Cost, Insurance, and Freight) as well as the value of those items. It is worth noting it is cheaper to ship more items.

Shipping a vehicle
Shipping a vehicle to Costa Rica is costly (costs more than shipping household items). Total costs vary depending on factors such as the; tax, size of the car, age of the car, how the car is shipped (i.e., in a container). It’s worth noting that taxation is charged against the original price, not the age or condition. The average retail value of the car is considered. The import value of a car can be established in the Ministry of Treasury Valuation Database:    http://www.hacienda.go.cr/autohacienda/AutoValor.aspx .
Total cost of importing a car to Costa Rica is highest for older car models. Cars manufactured in 1999 or earlier pay approximately 80%. Cars manufactured in 2000 to 2004 pay approximately 65% while those manufactured earlier i.e. 2004 and earlier pay approximately 55%.
International moving companies such as A-1 Auto Transport Inc. can assist with moving household goods and vehicles to Costa Rica. For more information visit  https://www.a1autotransport.com/moving-to-costa-rica/ .

Important considerations

Essentials

After considering the cost of shipping your car and household items to Costa Rica, you may become reluctant. However, most foreign residents, as well as Costa Ricans, prefer imported goods from countries like the U.S. because they are of better quality. If you value quality, you may want to go ahead and import. If you don’t mind living without luxuries, you can consider living in furnished apartments or consider what you need locally. Remember, what you need to import solely depends on your own preferences and budget. However, don’t ship what you can get cheaply or easily in Costa Rica. You should also make an effort to declutter before shipping. Also, avoid bulky items to avoid excessive shipping and taxation costs. It may also be smart to talk to foreign residents in advance just to get firsthand insights.

Port proximity

You should also consider shipping from the nearest port. If you live in the U.S. for instance, you should ship your car and household items from Miami, the U.S. port that is nearest to Costa Rica to enjoy lower shipping costs.

Tax waivers on household items

Foreign residents in Costa Rica are allowed to import merchandise worth $500 tax-free after every 6-months. This waiver is in addition to regular traveler’s luggage. You can take advantage of this waiver to import the items you need overtime. However, you must not exceed the $500 limit to avoid additional charges and customs restrictions.

Container shipping

It is very expensive to import large items by air. For items such as refrigerators, washing machines, etc. that exceed 500 pounds, consider shipping such items in a large container. You can choose a large or small container (40-foot or 20-foot). It costs approximately $1,500 including tax to ship items to Costa Rica using a 20-foot container. Large 40-foot containers cost approximately $2,000.

You need a customs agent to get all your household items and belongings (such as your car) out of customs seamlessly. You can find a reputable customs agent by conducting a simple search online or asking for referrals.

Required documents

Documents required to clear a shipment through customs include; a copy of your passport (the main page) plus the page containing last entry. This is required for your shipment to be treated as personal effects given customs must clear personal items within 90 days of a person’s arrival. You also need a packing inventory showing the value of the declared items. If the items are imported via air, you need an original airway bill. Freight forwarders send airway bills with shipments. Airline agents usually give you this document after you pay Terminal handling fees.

The above information summarizes the process of importing a car and other household items into Costa Rica. Since it is a lengthy and tedious process, most people prefer paying custom brokers/agents to handle everything on their behalf. It may cost more; however, you will save valuable time and effort.
Best of luck and pura vida!

JASON MUELLER
A Canadian expat, Jason Muller is currently living in Costa Rica and operating a small business. Jason enjoys travelling to many exotic locations and enjoyed meeting new people and telling related stories. Life is short, live your dream
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