Where to start? The first thing to do is to determine the purpose of your purchase: investment, rental property, primary residence, etc. From the moment we know what is the purpose of the purchase, we can direct you to properties that meet your needs and budget. The price is usually negotiable, around 5%, but sometimes more. All sales in Costa Rica are cash. But sometimes the owner offer some financing for up to 5 years at an interest rate of 7-9%, with a 50% down payment.
I love a property, what is the next step? Make an offer with your realtor. When the offer is accepted on a property, it is mandatory by law to have a notary to verify the transaction and be represented. The seller will be represented by his lawyer, and you with your lawyer. We, at Re/max, work with notaries fluent in English, Spanish, and even some who speaks French. The mandatory taxes and fees to pay to transfer a property are 2.5 %, levied on the highest of the fiscal value of the property or the purchase price, and are usually shared between the seller and the buyer. The cost of buyer's notary is around 1.25% of the purchase price.
Do I buy under my personal name? Foreigners in Costa Rica can own property in their own names. Purchasing property through a new or existing company or corporation (Ltda or S.A.) is very popular. To buy a property, and even a car, we recommend that the transaction is carried out on behalf of a Costa Rican corporation owned by the buyer. It's the notary who performs the opening of this company when purchasing a property or any other property of significant value. In this way, you are personally protected if there is a lawsuit of some sort. It is also a good way to save some taxes in your country. The cost is $800 to $1000 for the creation of the company.
How do I know if a property is titled? All property in Costa Rica (whether titled or concession) should be registered in the Public Registry, known here simply as the Registro. Your attorney will be able to confirm that the title chain is in order and will determine if there are any restrictions, encumbrances or liens. Avoiding the purchase of unregistered property is strongly advised.
How do I the transfer of money? When you buy a property, you generally have 10-14 days to transfer a deposit of 10 % of the transaction amount in a trust account. This account is opened in CR for you and the seller, in order to proceed with the transaction. This trust account costs between 0.20 % and 0.25 % of the purchase amount and is usually shared between the buyer and the seller. The balance of the payment of the property (including transfer fees, and notary trust account) must be transferred no later than 5 days before taking possession. If you change your mind and no longer wish to purchase the property, the seller is entitled to keep the 10% deposit. If the seller changes his mind and no longer wants to sell the property, you will receive 100% refund of your deposit without charge.
How is internet? Is it reliable? Yes, it works well. We have internet through fiber optic, phone, cable and satellite. Depending on the speed and service you use (2-10mbs), it costs from 25$ to 90$/month.
Electricity, is it reliable? Yes. It’s 0.22$ per kilowatts - for a 3 bedroom house of 2000 sqft with AC, dryer, pool, you can expect to pay between 300-550$ per month.
Cellular phone service, is it reliable? Yes - for 1000 min outcalls per month with internet service, it’s about 40$ per month.
How would you call friends and family in the US or Canada? Magic jack, it’s free to call in North America and Europe from Costa Rica. You can also use Skype, what's app, viber, facetime, etc.
When we move, does it make sense to move goods (ie furniture, cars) from our country or just purchase in CR? You better purchase here. There’s a duty fee of 40-50% (based on the value of the item here) on everything you bring.
Is there an US embassy? Is there a Canadian embassy? Yes, they are both in San Jose, 3.5 hours from Tamarindo.
How difficult is it to become a resident? Time frame? Costs? Please visit this website: http://immigrationexpertscr.com/costarica/.
At home, we use Netflix for movies. Can we use it in Costa Rica too? Yes. You can be connected to American tv as well with a dish or you can use a Sling Box.
Is it important to be able to speak Spanish? Not really. You will have to learn it eventually if you want to talk with your maid or your gardener, but in Tamarindo area most people speaks English.
Are there any major stores in the area (ie Walmart, Home depot, Ikea)? Yes, in San Jose. You will find Epa (ie Home Depot), Walmart, Pricesmart (ie Costco), etc. Unfortunately, no Ikea yet!
Where would you buy furniture, clothes, car? in Liberia and/or San Jose area.
Do I need a car? When taking possession and moving, it is preferable to have your own truck. You can always get a car from different retailers car rental companies in Tamarindo. To buy a car, we recommend going directly from known dealers like Toyota, Nissan, Honda, etc. The majority are located in large cities, as Liberia and San Jose. If you live in town, no need to buy a car. If you live outside town, you should buy a car because the bus service is not reliable.
If something happens to us, are we protected? We recommend that you prepare a will with your CR notary, as the one of your country does not cover your property in Costa Rica. In the absence of a will, your property will go to your parents first, and then children; not automatically to your spouse, even if you are married.
Are there waste (garbage) services? Yes, the municipality takes care of that every week. It’s paid in the same time than your property taxes.
Sewer or septic? There’s no sewer in Tamarindo area, every property has its own septic system.
City water or wells? There’s no city water in Tamarindo area, but there’s 3 water distribution associations/companies (AYA, ASADA, RUSSELL). There’s 6 wells for Tamarindo city. If you buy a property outside town, there’s other associations that takes care of the water distribution, you can even find some properties with their own well. For a 2000 sqft 3 bedroom home, you should expect to pay between 50-200$ per month.
Is it safe to assume we can own a home without being a resident? Yes, without any problem.
Is there maid and gardener services? Yes. A maid costs between US$ 3,00 and US$ 6,00 per hour. Same thing for the gardener.
What is included in the condo fees? Generally: home insurance building, common water and electricity, outdoor maintenance and common areas, gardening, pool and security.
How much are the property taxes in Costa Rica? Property taxes in Costa Rica are very low - only 0.25% of the registered property value. Some very large and luxurious properties are subject to a Luxury Tax that is based on a calculation that includes such features as structure size and finishings (ie travertine floors, imported faucets). Your attorney can arrange for a luxury tax assessment if you own a very large condo or home. As of 2013, the Luxury Tax has worked out to somewhere between 0.10 and 0.25% depending on the property's size and features.
Is there a storage place? Yes, we have Pura Vida storage within 5 minutes from Tamarindo! www.puravidastorage.com
Is there colleges? We have 2 private international schools within 15 minutes of Tamarindo - From Grade 1 to Grade 12: CRIA (www.criacademy.com) - From Grade 1 to Grade 8: Educarte (www.educarte.cr). We also have another private school (not international yet) called La Paz (www.lapaz.org) - From Grade 1 to Grade 12.
Is there universities? Yes, many. Universities are in San Jose, but most kids go back to their country of origin for University.
Are there any local sports? Soccer! Soccer! Soccer! Surf! Surf! Surf! And mountain bike!
Any golf courses and/or country clubs in the area? Yes, in Hacienda Pinilla and Reserva Conchal. Awesome golf courses!
Movies? it sounds like we will have a cinema in town soon! The closest one right now is an hour from Tamarindo, in Liberia.
Are there teams/activities for children and adults? Yes, outside sports and community activities. The social life is very active here for all of us.
Are there any major banks in the area? If so are the insured by the government? Yes. We have many local banks, and an ATM working with all North American cards. In Liberia, you can find a Scotia Bank, in San Jose there’s more options.
How do we pay our bills? If you rent your property, the property manager will pay the bills for you on your behalf. Otherwise, you need to open a bank account in CR. If you plan to pay your bills via the Internet, it is necessary that the bank give you a small electronic security key that will allow you to access your account (token). The key is available upon request, at the opening of the bank account.
Can you get US dollars from a Costa Rican bank? Yes. With your passport, you can get a lot of currencies.
What currency do most people deal with? US dollars and Colones.
How would we insure the house and car? Are there international companies? Yes. If you buy a single family home, it is worth taking home insurance. INS is the agency of government insurance, and some private companies offer this service throughout Costa Rica. Same for cars, life insurance, etc.
If we earned income from renting the house, is that capital gains or ordinary income? Incomes. When someone buys a property, they usually buy through a corporation. The buyer makes an investment in capital to his corporation and the corporation "owe" this money to the buyer. The buyer can take a cash back at the end of the year to pay back his investment, tax free. But it’s only after having paid the 10% taxes on profit he generated if it’s on the rental market. If there’s a mortgage involved, only the interests are deductibles as an expense. If the company had a gross income of less than 100,000 (this number changes every year), the tax on profit will be 10%. If it’s more than 100,000 (this number changes every year), the tax on profit will be 20%. If it’s more than 200,000 (this number changes every year), the tax on profit will be 30%. After the full capital investment will be paid back to the investor at 100% (which should take +-25 years at 4% net every year), then the owner can take a dividend and will pay 15% taxes on it.
How would we file being a resident and/or a non-resident? Please visit this website: http://costarica.com/relocation/paying-taxes/
If we want to rent the house out, are there management companies and how do they charge? Yes, there’s a couple of rental and management companies in town. They charge 20% commission on rentals. This 20% fee covers the commission, and the check-in / check-out of the tenants. These companies are usually also responsible for managing the interior and exterior maintenance, to pay the bills for you, and to do repairs that may arise for a monthly fee from 85$ to 250$. If you do not want to rent your property, you better hire someone to take care of it during your absence.
How is the rental market? How does it vary between long term (1 yr+) and weekly? The rental market is excellent! If you rent long term (30 days and more) in Costa Rica, you rent 3 years minimum, that’s the law. You also would do more money by renting the house per week.
Is there a 24 care center? Yes, a couple. If so where is it located? In town. Do they speak English? Yes. There is a major hospital in Liberia 45 minutes away from Tamarindo. Is this a good hospital? Yes, it’s called CIMA Hospital. They speak English. You can also go to the public one in Liberia or Santa Cruz if you are resident.
If we were to move there and become residents, can we get into the Costa Rica health care system? Yes. What would it cost monthly for a family of 4? It depends of your residency status. The immigration office will help you with this question. You can expect to pay between 70$-750$ per month.
Is there a pharmacy in town? Yes, there is many. Are the drugs readily available (ie antibiotics)? Yes. Are drugs part of the Costa Rican Health Care System? Yes.
Is there fire and police in town? Yes, there’s a temporary police station in town, they are planning a new one for 2017. Fireman are within 10 minutes from Tamarindo. As we have concrete buildings, fire is not a big issue.
How safe is the area? There’s a lot of robberies, but no crimes. The locals makes US$ 3,00 - US $ 6,00 per hour so they are looking for electronics and money. After taking possession of a property, it is preferable and even highly advisable to install an alarm system, unless you buy a condo in a secure building. We have 2 options in the area: Force One and ADT .
How are the costs in the grocery store relative to the US? It’s a little bit more expensive, but fish, fruits and vegetables and much cheaper.
There’s a lot of blogs done by expats, like those, who can help with your questions:
It’s good to know that almost half of those moving here goes back to their country within a year. Why? those are the most common reasons:
Their expectations are different than the reality - they idealize the life here, thinking everything is perfect (It is not perfect but it is VERY good!)
They think they can live with almost nothing, they realize they cannot and need a minimum of comfort
They are not realists with their budget, thinking they can live with $5,000-$7,000 per year... when it costs between 15,000 and 20,000 per person per year.
They are planning to work here and don’t find a job
It’s too hot for them
They miss their family and friends
Before moving, make sure you are ready. Read, get informed and ask some people living here how it is! Ask us, we are here to help, and all of us in our team made the big move! We know what we are talking about!