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Can foreigners own property in Costa Rica?

by RentasPuraVida on July 2, 2019
Can foreigners own property in Costa Rica?

YES! A foreign citizen can own property with the same rights as a Costa Rican citizen. You can own it under your name, or under the name of a Costa Rican corporation. The only exception is the maritime zone, which we will discuss in a moment. If you are buying a property with a value of at least $200,000, (amount at the time of this writing), you can get temporary residence status, which has many benefits. This value of $200,000 has to be certified by the local municipal offices and you have to own it outright. In other words, if you are buying it with a corporation, your percentage of shares should equal at least $200,000 of the total value of the property. The type of residency you would apply for is called “inversionista”, which means “investor” in English. Your spouse and children under the age of 25 are also eligible to acquire residency with yours. The benefits include not having to leave the country every 90 days and getting bank accounts, utilities, and cell phone lines without having to do it through a corporation.

Property Owned by Corporation

If you purchase a property that is owned by a corporation (sociedad) and not a physical person, you can elect to have the shares of the corporation transferred to you. This has some advantages in that all of the utilities, registering with the municipality, and other entities are already done. There is no tax advantage to this, however. Another thing to be aware of is that when you transfer a corporation to your name, you inherit any past problems that corporation might have, such as debt or lawsuits. You can have your lawyer research this first and also include in your contract that any problems that pop up after you assume the shares that occurred before are the responsibility of the previous shareholder. You can also register a fresh new corporation that purchases the property from the other corporation or the physical person. This has some protection advantages especially if you are planning to rent out the property for a long or short term.

Maritime Zone

The maritime zone affects oceanfront property and is where things get a little complicated. There are some rare exceptions to the maritime zone but about 95% of the coastal land in Costa Rica falls under this law. The maritime zone is defined as the first 200 meters measured horizontally from the high-tide line. Of these 200 meters, the first 50 meters is public, meaning it can’t be restricted in any way from public use or access. The other 150 meters can be utilized for the construction of homes or businesses but are registered as concession properties. Concession properties are similar to a lease from the government. Any foreigner with less than 5 years of residency status can only hold less than 50% of the concession, the majority can only be controlled by a Costa Rican citizen or a resident with 5 or more years living in the country. With municipal permits, you can construct your home or business and operate on the concession property just as you would on a fee simple property. You can even sell the business or home but under the concession restrictions.

Disclaimer: I am not an attorney. Please take this advice as general information which can change at any time. It is advised to consult a qualified Costa Rican attorney if you plan on purchasing property. Here is a valuable resource from the U.S. Embassy on legal assistance.

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