6 Reasons for Buying Property in Costa Rica

Amazing views like this one can be easily found. Your paradise awaits!

Booming tourism helped Costa Rica real estate market hit the big time in 2018 and the upswing continues.  This little eco-paradise on earth is the most visited country in Central America and condos, apartments, and vacation rentals located amid the breathtaking landscape are high on the list of tourists. Communities surrounded by picturesque, peaceful, and lush-green ambiance dotted with modern facilities entice people around the globe to consider buying property in Costa Rica for post-retirement life. Here are six reasons why it is worth a privilege to invest in Costa Rica real estate and what the benefits alluring foreign investment in this sector.

#1: Luxury in Serenity

When a more luxurious lifestyle dominates your thoughts, buying property in Costa Rica is the best option. Tranquil, impeccable, and safe Costa Rica is the perfect destination to holiday or lead a peaceful retirement life. Be a resident or a visitor, one can enjoy the luxuries of life at a much lower cost compared to any other countries in the western hemisphere and even China and Japan. Gated communities offer individuals and families with lush amenities while the supporting public infrastructure remains well-maintained thanks to the consistent GDP growth. From owning a high-quality home with private beach and property insurance to paying monthly bills and home maintenance expenses, it costs just a fraction of what one pay for top-class luxury in US or European cities. You can enjoy a life of luxury without paying too much.

#2: The Return on Investment

If you are not ready to move but looking for a safe and profitable income, buying a vacation rental in Costa Rica is worth a consideration. With an increasing influx of tourists, an investment fetches an annual rental return in the range of 7-8%, much higher than bank rates and even many stock markets. Also, an investor in Costa Rica real estate is assured of a good return, as properties have an average occupation rate of 65% in a year. From December to April, the tourist season sees rentals going up by two to three times.

With medical tourism in Costa Rica is thriving, this has its impact on the real estate too. Homeowners get long-term contracts from hospitals and rental companies, as people from across the world visit the hospitals for inexpensive cosmetic procedures and integrate it with holidays.

#3: Green Living

Buying a condo in Costa Rica not only comes cheap compared to many other Central American countries but also offers a chance to live in an unspoiled natural paradise. The country is the world’s poster boy of ecotourism and sustainable living. From plentiful sandy white beaches to extensive national parks in the hinterland, a quarter of its land area is protected flora and fauna habitat. Though just 0.03% of the world’s landmass, it is home to 5% of the world’s biodiversity. Its development plan, economy, and urban growth, all comply to set standards of sustainable living and environmental protection.

Costa Rica won the 2019 UN Champions of the Earth award for its plans to decarbonize the economy and encouragement to eco-friendly living. Renewable energy has a 98% share while the country has been able to restrict pollution level to the lowest in the world with the introduction of electric vehicles and trains. When you are buying a property in Costa Rica, you have a chance to live in the world’s best natural ambiance and also give your future generations a chance to lead a sustainable life.

#4: Minimal Taxes

The liberal and minimal taxation is another key attraction for expats and foreigners to invest in vacation rentals in Costa Rica. Social Security income, pension, and any income from foreign sources are tax exempted. You can stay in Costa Rica and do online jobs or business in any part of the world without paying taxes on your income.  Even rent earned from the property in the home country is tax-exempt up to approximately US$188,000 annual income. Those working in the country pay a tax not exceeding 30% of the income and that too many slabs with rebates.

The total cost of registration is less than 4%, including a property transfer tax of just 1.5%, of the official value. A buyer has to pay an additional 2.5% withholding tax. The annual property tax is even lower at 0.25% to 1% despite increasing demand for vacation rentals in Costa Rica. This offers a low cost of investment and living compared to multiple income benefits.

#5: For-Foreigners Market

Costa Rica real estate market is pro-foreigners and this entices people from all over the world to invest in its flourishing real-estate sector. The government follows a policy that protects the interest of foreign buyers in many respects. Foreigners can buy titled property in Costa Rica and enjoy the same property rights as locals have. There is no need for local partners in the majority of communities. It also presents itself as an attractive destination with zero-tax on foreign incomes and pensions. 

Unlike many other countries, selling real estate in Costa Rica is not subject to any capital gain tax. While property tax is minimal, the crime rate is abysmal allowing safe living and traveling. The political environment is stable and the economy is on a sound footing. There is no precondition of any type for foreigners to own a property in Costa Rica. Even property transfer through shares is exempt from the registration duty. An investment of $200,000 enables one a three-year temporary residency and the eligibility to apply for permanent residency. For tourists, the country grants a 90-day visa with no conditions.

#6: The Location

The geography is a big contributor to the boom in the Costa Rica real estate market. Its beautiful weather, pollution-free environment, and ease of access from big cities in the Americas and Europe have become a key attraction for people scouting to invest in property. A flight from Florida takes about 2 hours. It is easy to visit or relocate to the country.

The US Dollar is readily accepted by locals. A large number of people from the US, Canada, Mexico, Panama, Europe, the Caribbean, and South America have invested in the country’s property market. From beach-front apartments to villas in the rainforest, Costa Rica offers a varied choice for these investors. Services, infrastructure, and amenities, including health care, are of good quality considering the American standard. The country is also home to a large expat community making it truly international. English is widely spoken and understood.

Rising demand for property in Costa Rica presents an enviable opportunity to invest in it. Be it your investment, retirement planning, or relocation to this paradise on earth, you can safely select the country to put in and grow your money. A stable and progressive democratic administration, well-maintained infrastructure, and friendly ambiance allow expats to invest, enjoy, and relax amid its diversified landscape.

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