Interview with Erwin Huber “ Owning a Retirement or Vacation Home in Costa Rica”

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On the northern Pacific Coast of Costa Rica, where azure-blue seas sparkle beyond a sun-kissed shoreline and verdant mountains, there is a magical, tropical wonderland that is waiting just for you….

What are the local market conditions for vacation home ownership?

Costa Rica has become an international destination that attracts investors from around the globe.  Experts agree that Costa Rica property is the investment opportunity today that Hawaii was 30 years ago – ocean view real estate in a peaceful, progressive and pristine environment.

Major Hotel chains (Four Seasons, Hilton, Hyatt, Marriot, RIU just to name a few…) have opened flagship hotels in Costa Rica’s Guanacaste region and we are seeing a steady appreciation of property values as a direct result of their investment choices. The time to buy is now before prices are soaring!

The decision to buy property and build a home always involves questions and consultations. That’s even truer when investing in a foreign country. With Costa Rica Property Advisers you are able to buy with confidence.

Many of the details and concerns that might hinder other real estate purchases in Costa Rica are avoided when you purchase and build within an established private development. When you buy a home from one of these properties, you are provided with a single point of contact to assist you as you deem appropriate and our expert team will work closely with you throughout the entire process.

What is the construction and building quality of the home in comparison to Canadian standards?

We only represent developments that are owned and operated under American ownership. All properties are American designed, engineered and built to stringent North American specifications.

We know all developers on a personal level and can vouch for their integrity and professionalism.   Let us show you how much value you can get in Costa Rica for your hard-earned dollars….

Home buyers can be actively involved during the building process and view the progress of “their” dream home by visiting the building site in regular intervals. Most developers will encourage buyers to participate in this exciting process thereby giving them peace of mind. We know all developers on a personal level and can vouch for their integrity and professionalism.   Let us show you how much value you can get in Costa Rica for your hard-earned dollars….

What kind of documentation do Canadians require to live in full time or part time Costa Rica?

The Pensionado Program:

Among the five categories of residence, most expats, especially retirees, opt for the Pensionado Program. It requires proof that you have at least $1,000 a month in income from Social Security, a pension, or other retirement plan. You won’t be able to work as an employee in Costa Rica, but you can own a company and receive dividends from it. As a pensionado, you must remain in the country at least four months each year, and the program includes a spouse and dependents under 18 years of age.

The Rentista Program:

The Rentista Program is for people without fixed retirement income. It requires proof of $2,500 monthly unearned income (in other words, it cannot be from a job but rather interest, savings, or dividends) for at least two years or a $60,000 deposit in a Costa Rican bank approved by immigration authorities. Other provisions of the Rentista Program are similar to those for pensionados.

If you want to invest at least $200,000 in a Costa Rican business or commercial or residential property, you can become a resident under the Inversionista Program.

Tourist Visas

Immigration has now taken the position that the maximum visa is 90 days. Visitors who have 30- or 60-day visas can extend up to 90 days, but those who already have 90-day visas will have to travel out of the country and return. (just for 3 days and then they can return immediately for another full 90 days)

Foreigners, in theory, have the option of going to a local immigration office or an international airport to extend their tourist visa for 90 days, at a cost of $100. But the head of the immigration agency recently said that in order to renew a visa that way, you must show that you have the financial means to support yourself for 90 more days.

How do Canadians purchase real estate in Costa Rica?

Titles and transfers

In Costa Rica, property is transferred from seller to buyer by executing a property transfer deed (escritura) before a notary public. Unlike common law countries, such as Canada, where the role of the notary public is limited to authenticating signatures, in Costa Rica a notary public has extensive powers to act on behalf of the state. The notary public must be a Lawyer, and he or she may draft and interpret legal documents, as well as authenticate and certify their authenticity.

In order to close on the property, the buyer and seller must select a notary/Lawyer to draft the transfer deed and register the sale in an office known as the National Registry (Registro Nacional). All documents are centralized at this location. As such, all deeds executed in the provinces of Costa Rica must be filed in the National Registry. The local custom is that the buyer may select his or her notary/Lawyer to draft the property transfer deed if the buyer is paying cash for the property. If a portion of the purchase price is financed by the seller, there are generally three alternatives for selecting the notary/Lawyer:

1. If a large percentage of the purchase price is financed by the seller and a mortgage needs to be drafted to guarantee payment, then the seller may request that his or her notary/Lawyer draft the transfer deed.

2. If property is purchased with 50% cash and 50% financing, it is common for the buyer’s Lawyer and seller’s Lawyer to jointly draft the transfer deed and mortgage in a single document. This is known as co-notariado.

3. Finally, the buyer may insist that his or her notary/Lawyer draft the transfer deed and let the seller’s notary/Lawyer draft a separate mortgage instrument. In this case, because the mortgage is being drafted separately, it carries a higher registration fee. The registration fees are discussed below in the section on closing costs.

Property can be purchased in an individual’s name, jointly with other persons, or in the name of a corporation. The decision should be based upon your particular situation and after consultation with your Lawyer.

Ensuring a clear title
Costa Rican law requires that all documents relating to an interest and/or title to property be registered in the property section of the National Registry (Article 459- 460 of the Civil Code). Most properties have a title registration number known as the folio real, and the records database can be searched with this number or by name index (website: http:/ l

A National Registry report (informe registral) provides detailed information on the property, including the name of the title holder, boundary lines, tax appraisal, liens, mortgages, recorded easements, and other recorded instruments that would affect title.

Since Costa Rica follows the doctrine of “first in time, first in right,” recorded instruments presented to the National Registry are given priority according to the date and time in which they are recorded. Obviously, every situation differs, and in some cases a review of the National Registry record will not be enough to uncover all encumbrances. That is why it is important for the buyer to have his or her own Lawyer conduct an independent title search and investigation rather than rely on the seller’s Lawyer.

What are the closing costs and procedures for property purchasing property in Costa Rica?

Closing costs

The general custom is for the buyer and seller to share equally in the closing costs. This can be modified by agreement and usually depends upon the particular transaction.


Property Transfer taxes and registration fees, notary and legal fees, and mortgage costs, if any.  Government transfer tax and registration fees:

1. Real estate transfer tax

The government collects a property transfer tax (Impuesto de Traspaso) which is equal to 1.5% of the registered value of the property. The National Registry will not record a transfer deed unless the transfer taxes and documentary stamps have been paid.

2. Documentary stamps

The government also requires that documentary stamps be affixed to the deed. These stamps include the following: Municipal Stamp (Timbre Municipal); Legal Bar Association Stamp (Timbre del Colegio de Abogados); Agricultural Stamp (Timbre Agrario); National Archives Stamp (Timbre del Archivo Nacional); and Fiscal Stamp (Especie Fiscal). The National Registry also imposes its own tax of 0.50% on documents presented for recording to the National Registry (Derechos de Registro).

Notary fees:

The notary who drafts the contract for sale, carries out the real estate closing, and records the property title transfer is entitled by law to a fee that is based upon a percentage of the value of the transaction:

• Up to 10 million colones: 2% of the value of the transaction.

• On the excess of 10 million colones to 15 million colones: 1.5%.

• On the excess of 15 million colones to 30 million colones: 1.25%.

• On the excess of 30 million colones: 1%.

Pursuant to the law, these fees are the minimum that may be charged by the Notary Public. Any additional services including the drafting of pre-closing agreements, escrow, and the like may carry additional fees.

How is the health care in your area and how does it work?

Costa Rica is quickly becoming a world-class destination for medical tourism.  Several top-notch health care facilities are literally at your doorstep in the Guanacaste Region.  The brand new CIMA facility opened in 2013 and will be fully operational in 2014.    Several branches of the Biblica Clinics cater international medical tourists in Costa Rica.  Most of Costa Rica’s health care professionals have been trained in North America and speak English.     The fees are normally between 30%-40%  of what you would pay in the Canadian Health Care system.

Is it safe to live in Costa Rica?

You bet…!!·        

The 2012 World Bank Study for Global Governance Indicators ranks Costa Rica in the top two within Latin America for political stability.·     The country has a strong legal system that manages the ‘Judicial Power’, which ensures law compliance and covers nationals, as well as foreigners within the country’s territory.   Costa Rica ranks 1st among Latin American Countries in Social Progress. (Social Progress Imperative, Social Progress Index, 2013)

- According to The Economist Intelligence Unit, Costa Rica is ranked in the top 5 in Latin America with the best quality of life.
- Costa Rica ranks among the top 5 countries in environmental performance worldwide.
- Hospitals like CIMA and Clinica Biblica rank among the top 10 best hospitals and clinics in Latin America.
- Costa Rica has has one of the longest life-expectancy rates on earth.
- Costa Rica has one of the world’s seven “Blue Zones” — where people live measurably longer lives.
- Costa Rica is home to more Canadians (per capita) than any other country outside of Canada.
Delightful, near perfect tropical climate, low violent-crime rate, stable democratic government and a plethora of outdoor activities to partake in year round, Canadians seem to have no trouble adopting Costa Rica as their new home.
- Healthcare is not only affordable, but widely available to retirees from other countries
- Low Property Taxes, No Capital Gains Tax and No taxes on retirement income.
- Costa Rica has been awarded with several international recognitions as a tourist destination such as Trip Advisor 2013 – Traveler’s Choice Beaches Award for Top Beaches in Central and South America, and the Conde Nast Traveler
- Reader’s Choice Awards 2012 for 9th consecutive year.

Thanks Erwin, Sounds like Costa Rica would be ideal for setting up a perfect summer vacation home.   Here are the Costa Rica Vacation Homes


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