Frequently Asked Questions (FAQ) About Homeownership and Living in Costa Rica

We commonly receive inquiries about what it is like living in the Costa Ballena area of Costa Rica.  Here are some of the most common questions we hear:

How do real estate buyer’s agents work in CR?  Similar to the US and Canada, when searching for a home it is usually best to work with a single agent who will show you ALL properties from ALL local agencies rather than contacting individual sellers.  This ensures your interests are protected and you can see homes in an organized fashion.  As a buyer’s agent, I work cooperatively with all local agencies (some of my local colleagues do not) and can show you homes from all of them.  I work to represent your best interests and can help you focus on the things that matter most.  This involves no cost to you since, like in the US/CAN, the commission is paid by the seller and split between agencies.

Are real estate agents licensed/qualified?  Costa Rica does not currently license real estate agents.  However, agents must be registered with the financial authority (SUGEF), which we are of course.  Additionally, we participate in the CRGAR and the National Association of Realtors (NAR).  Furthermore, as a RE/MAX affiliate we are held to an even higher ethical and professional standard.

Is bank financing available?  In short, generally not.  Costa Rican banks will generally not lend to foreigners in most circumstances.  Some smaller percentage of properties do offer owner-financing, which means the seller will carry a mortgage and allow you to pay over time.  However, the terms are generally 50% down and repayment in 3-5 years.  Generally, home purchases are cash deals.

Should I buy a car, or ship it?  I typically recommend you buy a car here.  Import taxes are high and sometimes parts and warranty work can be difficult to obtain for imported cars.  Local cars are generally 25-50% more expensive than a comparable car in the US, but you often make it up on the sale later as cars tend to hold value longer here.

Should I ship my stuff?  Your call, but many people choose to simplify and just buy stuff locally as they need it.

How much are property taxes?  This can be an involved question, so discussions with an attorney and accountant may be in order.  The base rate is 0.25% and that applies to most homes here and is what most people pay.  There is also a “luxury tax” that varies depending on value of the improvements (the house and structures) and doesn’t apply to the land.  In some cases homes may incur an additional luxury tax of 0.25-0.55%.  Planning can help minimize luxury taxes.

Is a corporation necessary to buy and hold a property in Costa Rica?  The short answer is no, but for those without residency a corporation may be necessary to get some utilities – particularly electrical service.  Combined with inheritance concerns, many expats choose a corporation.

How easy is it to make friends?  Very easy for most.  Many areas have a fair number of expats that speak English (and even French), and they are often new to the area and open to making friends and meeting new people – plus they want to get “out and about” and are open and eager to meet new friends themselves.  Those who learn Spanish often find open and friendly Tico neighbors who are happy to meet people from around the world.

Do you need to learn Spanish to live in Costa Rica?  No, but…  I highly recommend it.  Many people learn just basic vocabulary to allow them to function well in their adopted home.  However, those who learn Spanish to some basic proficiency level generally seem to enjoy the experience more.

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