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Costa Rica Real Estate: The Guide for Investing in Paradise

Costa Rica Real Estate

Costa Rica is a paradise on earth, and more people are turning their attention to acquiring real estate in the country. Costa Rica has become an attractive option for property investors and homebuyers with its beautiful landscapes, diverse wildlife, and excellent infrastructure. As with any other type of investment, it’s important to consider all aspects before making a decision. This article will provide an overview of everything you need to know about buying real estate in Costa Rica: from assessing the market conditions to understanding what is involved in the purchase process itself. As the old saying goes, “all that glitters isn’t gold,” – but when it comes to investing in Costa Rican real estate, there’s certainly plenty of sparkle!


House in Los Reyes $620,000


Overview Of Country And Property Market

Costa Rica is a country located in Central America with over 4.9 million people and an area of 51,100 square kilometers. This tropical paradise has become one of the most popular tourist destinations in recent years due to its diverse landscapes, beaches, and forests. In addition, Costa Rica’s economy is largely dependent on tourism and agriculture, making it an attractive place for real estate investment opportunities.

The property market in Costa Rica is growing rapidly as more people are drawn to the beauty of this small nation. Demand for residential properties has increased significantly on the coasts as buyers look for vacation homes or retirement locations. The majority of foreign investors enter the market by purchasing beachfront villas or condos near major cities such as San Jose and Cartago. However, there are also options for rural areas where land can be purchased at much lower prices than those closer to urban centers.


Popular Property Types

A vast array of properties is available in Costa Rica, ranging from beachfront villas to mountain retreats. The most popular types of properties in Costa Rica include:

  • Beachfront properties: These properties are located directly on the beach and offer stunning ocean views. They range from luxury homes to further out from town, more affordable vacation rentals.
  • Mountain properties: These properties are located in the mountains and offer a peaceful retreat from the hustle and bustle of city life. They are ideal for those looking for a more secluded, tranquil lifestyle.
  • Eco-friendly properties: Costa Rica is known for its commitment to sustainability and eco-friendliness, and many properties in the country are built with these values in mind. These properties often feature solar panels, rainwater catchment systems, and other environmentally-friendly features.
  • Commercial properties: Costa Rica is also a popular destination for commercial real estate investment, with opportunities in the tourism, retail, and office sectors.


One popular option is single-family homes, which are great for those who want the freedom and privacy that comes with owning their own home. These properties typically have multiple bedrooms and bathrooms and plenty of outdoor space for activities like gardening or entertaining guests. Another sought-after type of property in Costa Rica is condominiums, which offer many of the same amenities as single-family homes but often at a lower price point. Condos provide easy access to local amenities such as restaurants, shops, and entertainment venues while providing homeowners greater security than single-family residences. Lastly, there are beachfront villas located on some of the country’s most beautiful beaches that offer an unparalleled level of luxury living with stunning ocean views and exclusive community amenities.

Costa Rica real estate has something to appeal to every buyer, whether looking for a primary residence or a vacation getaway. Prospective buyers should take into account factors such as location, budget, and desired features when deciding which property type best suits their needs.


Hotel in Escazu $2,950,000


Choosing the Right Location for Your Investment

When it comes to investing in Costa Rican real estate, location is critical. Some of the most popular destinations for real estate investment include:

  • Guanacaste: This region is located northwest of the country and is known for its stunning beaches, lush rainforests, and abundant wildlife. It is one of the most popular destinations for tourists and investors alike.
  • Puntarenas: This region is located on the central Pacific coast and is home to some of the most beautiful beaches in the country. It is also a popular destination for eco-tourism, with several national parks and reserves in the area.
  • San Jose: The capital of Costa Rica is located in the central valley and is a popular destination for those looking for a more urban environment. San Jose offers many properties, from city apartments to suburban homes. It is also a hub for commerce and industry, making it a popular destination for those looking to invest in commercial real estate.
  • Manuel Antonio: This region is located on the central Pacific coast and is known for its stunning beaches and lush rainforests. It is a popular destination for tourists and is home to Manuel Antonio National Park, one of the most popular tourist attractions in the country.


Leasing Options

When considering real estate in Costa Rica, leasing options are available for those looking to rent a property. Leasing is an attractive option for those who cannot commit to buying or may not have the financial resources. It also allows renters to explore different areas of the country without making a long-term commitment.

Rental contracts generally specify which utilities and services are included in the agreed-upon monthly fee. For example, some agreements cover water, gas, electricity, and internet access as part of their agreement, while others do not include these amenities. In addition, most leases require that renters pay additional fees, such as deposits or insurance premiums, prior to signing the lease agreement. The terms of each contract should be discussed thoroughly before entering into any binding written document.

Leases can range from short-term (less than one year) to long-term (more than three years), furnished or unfurnished. Short-term furnished leases offer greater flexibility but typically come with higher rates and more restrictions on how much time occupants can stay at the property. Longer-term unfurnished rentals usually involve lower rents but often include more responsibilities, such as maintenance and upkeep costs placed on the renter’s shoulders during their stay at the property. Regardless of whether you choose a short-term or longer-term lease option, it is important to read through all documents carefully before signing anything so that both parties understand what they are agreeing to.


Ocean view home in Chontales $439,000


Tax Regulations

Taxation in Costa Rica is divided into two major categories: public taxation and private taxation. Public taxation includes income and value-added taxes (VAT), while private taxation encompasses property taxes, transfer fees, and capital gains taxes.

Income earned by individuals and companies from renting out their properties will be subject to direct and indirect taxes. Direct taxes include VAT and personal income tax, which are applied progressively depending on one’s income level. Indirect taxes such as stamp duty or registration fees apply when signing rental contracts or transferring the title of the property; these vary according to the municipality or canton jurisdiction. Capital gains derived from the sale of residential properties are taxed.

Property owners who wish to rent out their properties must declare it with the Municipal Revenue Office in order to obtain a “Taxpayer Identification Number,” which they can then use when filing annual declarations that report any taxable income obtained during the year. Nonresident landlords must appoint an agent in Costa Rica authorized to act on their behalf before local authorities in order to comply with all applicable laws and regulations related to leasing activities there. It is thus important for potential lessees to familiarize themselves with all relevant taxation rules prior to making any decisions about Costa Rican real estate investments.


Financing Options

For those interested in real estate opportunities in Costa Rica, financing options are a key factor to consider. Investing in the vibrant and growing Central American nation requires knowledge of different payment structures as well as access to reliable lenders. As the saying goes, “cash is king” when it comes to buying property—but for many potential investors, this isn’t always an option. Fortunately, several ways to finance your purchase can help you move forward with confidence, such as Gap Equity Loans.

One popular form of financing involves obtaining a mortgage loan through a local or international bank. This type of loan typically offers competitive rates and terms; however, borrowers should be prepared to provide detailed documentation about their financial situation. Additionally, they must meet certain criteria, such as having sufficient income and good credit history, before being approved for a loan.

Another option is seller financing, which is a popular choice in Costa Rica as it can be difficult to qualify for a traditional mortgage. This is where the buyer makes payments directly to the seller instead of using traditional banking institutions. Seller financing often provides more flexible repayment terms and may include lower or no down payments. However, it is important to note that some sellers prefer cash purchases due to the lack of paperwork involved on their end.

Regardless of which route one decides to take when securing real estate investments in Costa Rica, understanding these various methods will ensure buyers get the most out of their purchase while avoiding any pitfalls along the way. It pays off to do your research so you can make an informed decision regarding which method best suits your needs and budget for maximum success and satisfaction with your investment into Costa Rican real estate market!


San Jose Condo $595,000


Legal Requirements For Purchasing Real Estate

Purchasing real estate in Costa Rica can be a complex process for the uninitiated, and it is important to understand the legal requirements for doing so. In order to purchase real estate in Costa Rica as a foreigner, you will need a passport and always update the Costa Rica registry when you get a new one  (make sure you keep all passports when you renew, as you may need them in the future) or even better a temporary or permanent residency ID-card. Additionally, all foreign buyers should hire a trusted lawyer who specializes in real estate law; they are essential when navigating the complexities of buying property abroad.

In addition to obtaining the necessary documents, foreign purchasers must open two bank accounts: one with a local bank (in colones) and one with an international bank (in dollars). All payments made by foreigners throughout their transactions must adhere to certain rules set forth by Costa Rican banking regulations. Furthermore, once escrow has been established, all funds received and sent out during the closing processes of the sale must go through both of these accounts.

Finally, after settling on terms of purchase and signing contracts between buyer and seller that a public notary has notarized, registration fees will apply – depending upon each specific case – which must be paid at the local Property Registry Office before the title deed can be issued. The final step in this process involves payment of taxes imposed by the government and verification that all documentation meets legal standards before ownership is granted.


Mountain home in Chontales $379,000


Rental Income Potential

Investing in Costa Rican real estate can be a great way to generate rental income. This is due to the country’s growing tourism industry, which has been steadily increasing over the past decade and continues to grow every year. With an influx of tourists visiting throughout the year, there are many opportunities for those with properties available for rent, whether through long-term leases or short-term vacation rentals, especially during the high season.

In addition to tourism, Costa Rica also allows investors to capitalize on rental agreements that target expats looking for longer-term housing solutions while in the country. Depending on their circumstances and needs, expats may seek shorter-term rentals ranging from one month to six months. These types of leases often provide higher returns than traditional long-term lease options since they typically require higher rents and fewer tenant responsibilities related to maintenance and upkeep.

When considering investing in Costa Rican real estate to generate rental income, it is important to research local regulations regarding renting out a property, calculate potential return rates based on comparable market data and weigh any risks associated with the investment before making a purchase decision.


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Development Opportunities

Costa Rica is an attractive location for real estate development due to its stunning natural beauty, tropical climate, and relatively low cost of living. In addition, the country offers a variety of investment opportunities for developers looking to build homes or commercial spaces.

The Costa Rican government encourages foreign direct investment by offering a number of incentives, such as tax exemptions on certain projects, reduced import duties, and access to special financing programs. These incentives make it easier for investors to take advantage of the many development opportunities that exist in Costa Rica.

For those interested in investing in Costa Rica’s real estate market, there are numerous options available, ranging from vacation rental properties and luxury developments to eco-friendly projects aimed at preserving the environment. The sheer diversity of these options makes Costa Rica an ideal place to invest in real estate and capitalize on growth potential while taking advantage of unique lifestyle benefits.


Cost Of Living Expenses

Living in Costa Rica is like riding a roller coaster – you experience some unexpected twists and turns. It can be exciting, but it also requires careful consideration of the cost of living expenses that come along with it. As such, prospective real estate buyers should understand what to expect when budgeting for their new home.

When looking at the cost of living in Costa Rica, one of the biggest factors affecting your budget will be the price of housing. Due to foreign investment and increased demand, property prices are generally more expensive on the coasts than in other parts of Central and South America. However, plenty of affordable options are available depending on where you live, such as the central valley (in or adjacent to the capital of San Jose) and the type of property you purchase. Additionally, taxes and closing costs associated with purchasing a home can add up quickly, so these should also be taken into account.

Costa Rica does offer many benefits for those looking to relocate or invest in real estate. The country has low crime rates and an excellent healthcare system, making it attractive for retirees who want to stay safe while enjoying the warm weather year-round. Furthermore, its proximity to North and South America makes traveling easy, so expats don’t have to worry about being too far away from family or friends back home. With all this in mind, potential homeowners should carefully consider how much they’re willing to spend when making their decision since each person’s unique situation could impact their final choice significantly.


Finca in Guapiles $355,000


Climate Considerations

Depending on where you decide to purchase property in this country, there are various climates to choose from. In general, the climate in most areas will be warm and humid, with a cool breeze coming off the ocean or mountains.

Costa Rica experiences two distinct seasons: the dry season (December-April) and the green season (May-November). During the dry season, temperatures tend to be higher due to lower moisture levels, while during the green season, they can drop due to increased humidity. The amount of rain also varies depending on the region; some parts may experience more than others. It is important to consider these factors when purchasing property, as certain rural locations may not have access to amenities such as electricity or water that other regions do. Additionally, different vegetation types grow in these climates, making it essential for buyers looking for land suitable for farming or gardening purposes.

Taking time to familiarize yourself with local weather patterns, average temperature ranges, and precipitation amounts beforehand can help ensure you stay happy with the weather at all times of the year.


Residency Options

Ripe with residence opportunities, Costa Rica is a top destination for individuals seeking to relocate. Many are drawn to the country’s tropical climate, diverse culture, and wide range of available real estate options. With an abundance of residency programs at their disposal, prospective buyers can find suitable homes in various parts of the Central American nation.

The most common type of residency permit granted by the government is called a Rentista Visa. This program allows foreign nationals who have a steady source of income from outside Costa Rica to live in the country without having to obtain employment or pay taxes locally. To qualify for this visa, applicants must demonstrate that they have enough money to cover their living expenses while staying in Costa Rica. Other criteria include being free of criminal records and not engaging in activities that could be detrimental to public order or national security.

In addition to the Rentista Visa, several other types of visas are available depending on individual circumstances. These include the investor visa for those looking to invest $150,000 USD or more into a local business or property. We recommend CRIE (Costa Rica Immigration Experts) for all your residency needs.


Air Bnb property 820,000


Infrastructure Development

Costa Rica has taken steps to ensure that its infrastructure meets the needs of its growing population. The government has invested heavily in improving existing transportation networks such as roads, bridges, and highways while developing new projects like the extension of the national railway system. Additionally, efforts are being made to improve telecommunications services throughout the country, with an increased focus on rural areas where internet connections are unavailable.

In addition to physical infrastructure, social reforms have been implemented by the government aimed at providing better living conditions for citizens across all socio-economic backgrounds. These include initiatives such as health care reform, education reform, affordable housing programs, and improved public safety measures. Such investments lead to greater stability within society, encouraging long-term growth in local real estate markets by making them more attractive places for people to live or invest in properties.


Insurance Coverage For Property Ownership

Insurance is necessary for residential and commercial properties, as it protects against unforeseen damages or events that could cause financial losses. On average, homeowners can expect to pay around 5–8% of the total purchase price for their policy premiums.

In addition to protecting your asset from physical damage and liability claims, some policies include personal items such as furniture and clothing. When shopping for an insurance plan, be sure to compare different providers so you can find one with the best rates and coverage options. It’s also recommended to speak directly with a representative who specializes in Costa Rican real estate since they are familiar with local regulations and laws related to ownership.

Insurance plans vary greatly depending on the purchased property type and location. For example, beachfront homes may require more expensive coverage due to potential flooding risks. At the same time, remote locations may have lower premiums because fewer incidents occur there than in densely populated areas. By understanding the specific needs of your investment property and researching available policies carefully, you can ensure that you are adequately covered without overpaying.


Uvita Mansion $1,049,000


Why Invest in Costa Rican Real Estate?

Costa Rica offers several benefits to real estate investors, including:

  • Stable economy and political climate: Costa Rica has a stable political and economic environment, making it a safe and secure destination for investment.
  • Growing tourism industry: The tourism industry in Costa Rica continues to grow, providing investors with a steady stream of rental income.
  • Favorable tax environment: Costa Rica has a good tax environment for foreign investors, with low property taxes and other incentives available.
  • Abundant natural beauty: With its lush rainforests, pristine beaches, and abundant wildlife, Costa Rica is a breathtakingly beautiful country that offers investors a chance to experience paradise.


Investment Opportunities

Costa Rica real estate offers many attractive investment opportunities for those looking to invest in the international market. According to a recent report by the World Bank, Costa Rica’s economy is projected to grow at an average rate of 3.2% annually over the next decade. This makes it one of Latin America’s most promising emerging markets and a great choice for investors interested in making long-term investments.

When investing in Costa Rican property, several factors should be taken into consideration, such as location, size, condition, and potential return on investment (ROI). Investors should also consider legal issues related to purchasing property in another country with different laws than their own home nation. Seeking local expertise can help ensure all due diligence is done properly when selecting a specific piece of land or building.

In terms of ROI, Costa Rica has seen robust growth compared to other countries in Central America due to its stable political climate and economic policies designed to attract foreign capital. The country boasts high rental yields, which offer excellent returns for buyers who plan on renting out properties rather than flipping them for short-term gains. With careful planning, choosing the right property could provide a steady income stream and future profit from appreciation. 


Heredia House $179,000


Navigating the Real Estate Process in Costa Rica

Investing in real estate in a foreign country can be a complex and overwhelming process, but with the proper guidance and preparation, it can also be a rewarding experience. When investing in Costa Rican real estate, it is essential to:

  • Hire a reputable real estate agent: A knowledgeable and experienced real estate agent can help guide you through buying or selling a property in Costa Rica.
  • Research the property: Before making a purchase, thoroughly research the property and the surrounding area. This includes reviewing any property deeds, checking for any outstanding debts or liens, and verifying the legal ownership of the property.
  • Work with a local attorney: A local attorney can help navigate the legal process of buying or selling real estate in Costa Rica and assist with any necessary document translation.



Costa Rica is an attractive destination for real estate buyers, both local and foreign. Its lush landscapes, tropical climate, and vibrant culture offer a unique opportunity to purchase property in an idyllic setting. The country’s average cost of property varies depending on location but can be quite affordable compared with other popular tourist destinations. 

If you’re looking for your own piece of paradise at an affordable price, consider purchasing real estate in Costa Rica! There really is something here for everyone interested in buying real estate in Costa Rica. Ultimately, there are numerous areas throughout Costa Rica where individuals can find real estate at competitive prices that fit their individual needs. You will rest assured knowing you have made the right choice once you are here and enjoying breathtaking views of this beautiful Latin American country.


-Written by Glenn Tellier (Founder of Grupo Gap)

+506 8500-2085


Modern home Uvita $477,000


Frequently Asked Questions


What Is The Average Cost Of A Property In Costa Rica?

Property values in Costa Rica vary greatly depending on the location and quality of the asset. In general, however, one can expect to pay an average price of around $100,000 to $200,000 USD for a property located near major cities such as San José or Guanacaste. This number can go up significantly if you are looking at properties with ocean views or other desirable features.


What are a few Affordable Areas To Purchase Real Estate In Costa Rica?

The Guanacaste province is known for its luxurious resorts, while coastal towns like Tamarindo are renowned for their affordability and laid-back atmosphere. The Central Valley area is also popular among expats due to its city life amenities (shopping centers, hospitals, nightlife, education centers, etc.) and close proximity to San Jose International Airport.  One will find lower costs outside major cities, such as rustic cabins tucked away in hillside villages due to a lack of demand, such as tourists or expats looking for luxury homes on the beach.


La Fortuna house $120,000


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