Why Closing Costs Matter
Purchasing a property in a foreign country is exciting, but it is also a serious financial decision. Part of your due diligence is understanding exactly what you will pay at closing so there are no surprises. In Costa Rica, that means knowing how closing costs are calculated, what is included, and how those costs are usually shared between buyer and seller.
Closing costs at a glance
Every transaction is different, but as a very general guideline:
- Buyers can expect closing costs (excluding any financing) in the range of roughly 3–4% of the purchase price, plus one-time extras such as surveys and inspections.
- Sellers can expect closing costs of roughly 6–8% of the sale price, including the real estate commission and any applicable capital gains tax.
- Many items are shared between buyer and seller and can be negotiated as part of the offer.
The sections below explain how those percentages are built and what to expect in a typical coastal real estate transaction.
Comparing Costa Rica to North America: The Differences
In general, closing costs in Costa Rica tend to be higher than what most buyers are used to in the United States or Canada. One of the main reasons is the way Costa Rica collects taxes on real estate transfers. The good news is that the calculation is straightforward: most items are based on a percentage of the property value.
For many years, enforcement around property transfer values was relatively relaxed, which encouraged under-reporting of values and created issues with property tax collection. The government has been tightening these rules and is now much more focused on accurate reporting. As a buyer or seller, the safest approach is simple: keep everything transparent, follow your attorney’s advice, and make sure the recorded value reflects the real transaction.
Breaking Down the Components: What Makes Up Closing Costs
In Costa Rica, closing costs are generally made up of five main components: the transfer tax, national registry and documentary stamps, legal (notary) fees, escrow fees, and the real estate commission.
1. Transfer tax, national registry and documentary stamps
The total of transfer tax and mandatory stamps to transfer the shares of a corporation is usually around 1.5% of the value. If you transfer the property itself (rather than just the shares of an existing corporation), the combined rate is approximately 2.4%.
To reduce the risk of tax evasion, Costa Rica calculates transfer taxes on the higher of two amounts: the contract sale price or the registered fiscal value in colones at the exchange rate on the day of calculation. In most transactions, this cost is shared between buyer and seller, but it is always a matter of negotiation and should be clearly stated in the purchase and sale agreement.
Share transfer vs. property transfer: a simple example
In some older structures, a property may already be held inside a Costa Rican corporation. In those cases, one option is to transfer the shares of that corporation instead of transferring the property itself. As a simplified example:
- If you buy a home registered directly in an individual’s name, you will usually pay the full 2.4% transfer tax and stamps on the registered value.
- If you buy all the shares of a corporation that already owns the property, the applicable rate is closer to 1.5% on the share transfer.
Whether a share transfer is appropriate depends on the legal and tax history of that corporation. Your attorney will review the structure, any risks, and whether it makes more sense to transfer the property into a new corporation in your name instead. The key is to look at the whole picture: cost, risk, and long-term ownership strategy.
On top of this, your property purchase in Costa Rica may include additional one-time costs such as a topographical survey, property inspection, transfer of electric and water meters (if handled by your attorney), and specific legal documents such as affidavits, powers of attorney, or the creation of a new corporation. You may also see prorated items such as property taxes and HOA fees calculated according to the closing date. These extra items commonly range from about US $2,000 to US $5,000 and should be estimated by both your agent and your attorney based on your particular transaction.
Sellers should also be aware of the capital gains tax in Costa Rica, which is due within 30 days after closing. In many cases, the seller’s attorney will ask that the estimated capital gains tax be held in escrow from the sale proceeds so funds are available to pay the tax on time.
Quick notes on currency and taxes
Most coastal transactions are negotiated in U.S. dollars, but the formal calculations are done in Costa Rican colones. A few practical points:
- The official transfer tax and stamp calculations are in colones using the official exchange rate on the day the calculation is made.
- IVA is Costa Rica’s value-added tax, applied to certain professional services such as legal work and escrow fees.
- Your closing statement will often show line items in both USD and CRC. Ask your attorney or escrow officer to walk you through each line if anything is unclear.
2. Legal fees: the role of notaries in property transfer
Costa Rica has a specific legal structure for real estate transfers. Only attorneys who have become notaries (notarios públicos) are authorized to register a property transfer in the National Registry. Becoming a notary is considered a professional step up from being a general attorney.
To be appointed as a public notary, a lawyer must be a member of the Costa Rican Bar Association (el Colegio de Abogados), practice law for at least two years, and then complete a specialized legal degree in notary and registry law. In practical terms, a notary public in Costa Rica is an attorney with specialized training in property transfers and registration.
As a result, only a notario público has the legal authority to formalize a real estate transfer. If you have not yet chosen an attorney, it is best to work with a law firm (un bufete) that has an in-house notary public. This will make your closing smoother and help avoid delays or missing documentation.
The buyer’s attorney fees follow a tiered structure based on the property value:
- Up to 10,000,000 colones: 2.0% plus IVA
- 10,000,001 to 15,000,000 colones: 1.50% plus IVA
- 15,000,001 to 30,000,000 colones: 1.25% plus IVA
- Above 30,000,001 colones: 1.00% plus IVA
The seller’s attorney will typically charge a minimum of 0.50% plus IVA to represent their client, and this can increase when additional work is required. For example, the attorney may need to close an existing corporation, update the corporate books, or correct issues in the property’s registration. It is important to review these potential costs with your attorney early in the process so you have a realistic estimate.
3. Escrow fees: why we use an escrow company
Using a licensed escrow company is standard practice in Costa Rica for real estate transactions. The escrow company receives and holds the funds, then releases them once all conditions in the purchase and sale agreement have been met. In other words, no one gets paid before closing unless a specific exception is written into the contract.
This independent third-party role adds an important layer of security and trust for both buyer and seller. Your RE/MAX agent can recommend reputable companies that are experienced, responsive, and familiar with international clients. Escrow fees are usually shared equally by buyer and seller and typically range from about 0.20% to 0.34% of the purchase price, with a minimum fee of approximately US $800–1,000 per transaction.
4. Real estate commission
Working with a professional RE/MAX agent in Costa Rica gives you access to local market knowledge that would be very difficult to build on your own. Experienced agents understand neighborhood trends, realistic price ranges, and the small details that matter in each community. They also handle the practical side: coordinating showings, communicating with sellers and buyers, and helping to keep all parties on schedule for closing.
RE/MAX agents also use multiple listing services (MLS) and internal networks to access a wide range of properties that match your criteria. Their established relationships with inspectors, escrow companies, attorneys, and other service providers help you move through the process more efficiently and with fewer surprises. They can provide basic market analysis and help you evaluate whether a property is fairly priced based on recent sales and current demand.
In most cases, real estate commissions are paid by the seller. The standard commission is 6% plus tax, although the percentage can sometimes be negotiated on higher-value properties (typically US $2M and above). When there are two separate agents involved—one representing the buyer and one representing the seller—the commission is normally split 50/50 so each party has their own advocate in the transaction.
Who foots the bill? Understanding buyer vs. seller responsibilities
In our area, it is customary for the buyer and seller to share transfer taxes, stamps, and escrow fees, but the final arrangement always depends on the negotiation. In a buyer’s market—or when a property has been listed for a long time—the buyer may have more leverage to ask the seller to absorb a larger share of the closing costs. In a strong seller’s market, the terms usually favor the seller, and buyers can expect less flexibility on these points.
Along the North Pacific coast of Costa Rica, including areas such as Tamarindo and Flamingo, most international transactions follow a fairly consistent pattern: shared government fees and escrow costs, seller-paid commission, and a negotiated split of any extras. The exact numbers can vary, but the structure is familiar to local attorneys and agents, which helps make the process more predictable for foreign buyers and sellers.
BUYER’S closing costs are typically as follows when the buyer transfers the property into a new corporation or into their personal name:
- 1.25% + IVA (about 1.41% total) for the notary to complete due diligence, register the property in the National Property Registry, and perform closing duties.
- 1.2% (part of the total 2.4% transfer and stamp cost typically shared between buyer and seller) in government stamps and fees when you purchase a property in your own name or in the name of your corporation.
- 0.15% + IVA (about 0.34% total, typically shared between buyer and seller) in escrow fees if you use a third-party escrow company.
- Other extra fees as discussed above (surveys, inspections, meter transfers, etc.).
SELLER’S closing costs are typically as follows:
- 0.50% + IVA (about 0.56% total) for the notary to represent the seller, perform due diligence from the seller’s side, and handle their closing duties.
- 1.2% (part of the total 2.4% transfer and stamp cost typically shared between buyer and seller) in government stamps and fees on the transfer of the property.
- 0.15% + IVA (about 0.34% total, typically shared between buyer and seller) in escrow fees when a third-party escrow company is used.
- Other extra fees as discussed above, plus any applicable capital gains tax.
Checklist before you sign your purchase and sale agreement
Before you sign an offer or a purchase and sale agreement, ask your agent and attorney to help you confirm:
- Who is paying each component of closing costs: transfer tax, stamps, legal fees, escrow fees, and extras.
- Whether the transaction will be structured as a share transfer or a direct property transfer—and why.
- That you have a written estimate of legal fees and escrow fees based on the agreed purchase price.
- How prorated items such as HOA fees and property taxes will be calculated on the closing statement.
- For sellers, how capital gains tax will be handled and whether funds will be held in escrow.
- What happens to your deposits and inspected items if the deal is cancelled under the contract terms.
A short review at this stage can prevent misunderstandings later and give you a much clearer picture of your real net cost or net proceeds.
We created the calculator below to help our clients estimate closing costs when buying or selling. The sample shown is based on a property priced at US $400,000. Real transactions can have additional details that affect the final numbers, so it is always important to review your specific situation with your attorney and your agent.
If you would like a customized closing cost estimate for a specific property, share the price and basic details with our team and we will help you understand what to expect as a buyer or a seller in today’s market.
Frequently asked questions about closing costs in Costa Rica
Are closing costs different for pre-construction or developer sales?
They can be. Some developers offer incentives or structure their deals slightly differently, especially on pre-construction projects. You may see different rules around deposits, payment schedules, or who pays specific fees. Always ask your attorney to review the developer’s contract and clarify how closing costs will be handled before you sign.
Do foreigners pay higher closing costs than Costa Ricans?
No. The legal percentages for transfer taxes, stamps, and notary fees are the same for foreigners and Costa Rican citizens. The main difference is that international buyers often rely more heavily on their agents and attorneys to explain the process, which is why choosing an experienced team is so important.
Can I finance my closing costs in Costa Rica?
Most international buyers who purchase with cash or offshore financing pay their closing costs out of pocket at closing. If you are using a local bank loan, your banker can explain what portion of fees might be added to a loan or must be paid separately. For many foreign buyers, it is simpler to plan for closing costs as a cash item.
What happens if the deal falls through?
What happens to your deposits and any inspections or legal work already completed depends on the specific terms of your contract. Some deposits may be refundable under certain conditions, while others are not. Legal and inspection fees already incurred are typically not refundable. This is another reason why the purchase and sale agreement should be carefully reviewed before signing.
Are closing costs the same across all of Costa Rica?
The basic legal percentages are national, but there can be local practices and market norms that vary between regions and price points. Coastal markets that work heavily with international buyers have very standardized processes and experienced professionals who can explain how things are usually handled for your type of property.
Navigating Costa Rican real estate with confidence
Closing costs are just one part of purchasing or selling property in Costa Rica, but understanding them early will make the whole process smoother. At RE/MAX Ocean Surf & Sun, we work with international buyers and sellers every day and can help you understand how these numbers apply to your particular property and strategy.
Whether you are looking to purchase a vacation condo, a family home, or an income-producing investment, our team can guide you through each step—from identifying the right property to coordinating legal support, escrow, and closing. Tell us about your plans, timeline, and budget, and we will respond quickly with options that make sense for you.
If you are considering a purchase or sale in our area and want a clear estimate of your closing costs in Costa Rica, contact RE/MAX Ocean Surf & Sun. We are here to help you move forward with confidence.