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Buying Real Estate in Costa Rica: What Canadians and U.S. Citizens Need to Know
- Ashlee Brown
- Aug 8
- 4 min read
Thinking about buying property in Costa Rica? Here’s a complete guide for Canadians and Americans—including how the process works, legal tips, and what to know about financing options.
Dreaming of a Home in Paradise?
More and more Canadians and Americans are falling in love with Costa Rica—not just for a vacation, but as a place to live, invest, or retire. And the good news? Foreigners have the same property ownership rights as locals. But that doesn’t mean the buying process is the same as back home.
If you're considering purchasing real estate in Costa Rica, this blog post is your roadmap. We'll break down the steps, highlight key legal and financial differences, and explore what financing options are available for North Americans.
1. Can Foreigners Own Property in Costa Rica?
Yes! Both Canadians and Americans can legally own property in Costa Rica, with very few restrictions. You do not need to be a resident or citizen. However, there are some important rules to understand:
🏖️ Titled vs. Concession Land:
Titled land: Full ownership—just like in Canada or the U.S. Most inland and some beachfront properties fall into this category.
Concession land: Found in the Maritime Zone (within 200 meters of the high-tide line). You don’t technically “own” this land—you lease it from the government. There are added complexities, especially for foreigners.
🔎 Tip: Always consult a reputable, bilingual real estate attorney before purchasing any property.
2. The Buying Process, Step by Step
Step 1: Choose a Licensed Realtor
Costa Rica’s real estate market is unregulated, which means anyone can call themselves an agent. This makes it vital to work with a trusted, professional agent or agency—ideally affiliated with organizations like CCCBR or CRGAR.
👣 Our real estate tours connect you directly with vetted, professional agents to protect your interests from day one.
Step 2: Make an Offer and Sign a Purchase Agreement
Once you find the property you love, your agent will prepare a written offer. If accepted, your lawyer drafts a Purchase and Sale Agreement (PSA), outlining price, conditions, and due diligence timelines.
Step 3: Due Diligence
Your attorney checks:
Property title (for liens or disputes)
Survey maps (catastro)
Taxes and utilities
Construction permits (if applicable)
Step 4: Escrow and Transfer
Funds are typically held in a third-party escrow account and transferred once due diligence is complete. The property is transferred via a transfer deed (escritura) and recorded in the National Registry.
⚠️ Be cautious about paying directly to sellers without proper escrow or legal structure.
3. Financing Options for Canadians & Americans
💰 Buying with Cash (Most Common)
Roughly 70–80% of property purchases are cash deals.
Many buyers liquidate home equity or retirement funds in their home country to avoid financing complexities.
🏦 Can You Get a Mortgage in Costa Rica?
Yes, but it’s not like home:
Costa Rican Banks:
Rarely lend to foreigners unless they have residency and strong financial ties to the country.
Long processing times.
Often require high down payments (40–50%).
Private Lenders:
Faster approvals.
Higher interest rates (often 8–12%+).
Require property as collateral.
Ideal for short-term bridge financing.
Developer or Owner Financing:
Some developers or sellers offer in-house financing.
Terms vary—typical down payment is 30–50%, with balloon payments due in 2–5 years.
4. Taxation, Fees & Ongoing Costs
One-Time Fees:
Property transfer tax: ~1.5%
Legal fees: ~1–2%
Escrow and registration fees: ~0.5%
Annual Costs:
Property taxes: Just 0.25% of assessed value
Luxury tax: Applies to homes over ~$235,000 USD (on construction value)
🇨🇦 Canadian Tax Tip: Canada taxes worldwide income. If you earn rental income in Costa Rica, declare it in Canada. You may be eligible for foreign tax credits.
🇺🇸 U.S. Tax Tip: The U.S. also taxes global income. If you rent out your Costa Rican home or later sell it for profit, you must report it to the IRS.
5. Residency vs. Ownership
You don’t need residency to own property or live in Costa Rica part-time. But if you want to live full-time or open local bank accounts, you may consider applying for:
Pensionado: For retirees with guaranteed income ($1,000/month)
Rentista: For those with $60,000 in a Costa Rican bank or $2,500/month income
Investor: For property investments of $150,000 or more
6. Pro Tips for Canadians & Americans Buying in Costa Rica
✅ Visit Before You Buy – Every region feels different. Take your time.✅ Use a Trustworthy Attorney – This is non-negotiable.✅ Don’t Skip Escrow – Protect yourself.✅ Consider Holding Property in a Corporation – Common for asset protection and inheritance planning.✅ Plan for Currency Transfers – Work with reputable currency exchange services to avoid high bank fees.✅ Ask About Infrastructure – Internet, water, and roads vary widely by region.
Final Thoughts: Invest in Paradise—Wisely
Buying property in Costa Rica is not only possible for Canadians and Americans—it can be a smooth, rewarding experience with the right support.
At Pura Vida Real Estate Tours, we take the guesswork out of the process by offering guided tours, local insight, and connections to trusted professionals who will help you make smart, informed decisions.
📞 Ready to explore Costa Rica’s property market with confidence?Book a tour with us today and take your first step toward living the Pura Vida life.
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