Transfer Tax. The government collects a property transfer tax which is equal to 2.44% of the real value of the property, including the documentary stamps listed below. The Public 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, as listed in the table.

Notary Fees. The Notary that drafted the contract for sale and carried out the closing is entitled by law (Decree 2307-J) to a fee equal to 1.5% of the first one million colones of the actual sales price and 1.25% on the balance.

Mortgages. Recently, financing Costa Rica real estate has become more accessible to foreigners. Stewart Mortgage Brokerage (of Stewart Title) services offer U.S.-style financing to qualified U.S. residents, and partner with institutions such as Banex. Scotiabank, and Banco Cuscatlan also provides up to 70% financing to non-residents. The Tico Times (www.ticotimes.net) publishes an excellent updated chart  with mortgage information from the country's major banks in its October Real Estate supplement.

Bank financing for residents is similar to that offered in the United States. Mortgages are usually available in dollars or colones, and banks generally finance up to about 80% of their appraised value of the property.

Because of the controlled devaluation of the colón (approximately 10% per year), annual interest rates for local-currency real-estate loans for terms of 15-20 years are currently around 19% to 22%. Dollar loan rates are up to 50% lower, often calculated by the 3- or 6-month LIBOR rate plus 3%-6%.

It is customary for the person who is receiving financing to pay the costs of drafting and registering the mortgage instrument. A mortgage can be created simultaneously at the time of sale by adding a mortgage clause in the transfer deed. Or, a separate mortgage instrument can be drafted. Mortgage costs can run to up to 8% of the loan, including registration fees, documentary stamps and Notary Public charges.

Costa Rica real estate - Property Taxes

Under Costa Rican tax law, you must declare the value of your home to the Costa Rican Municipal Government every five years. An annual flat rate of 0.25% is charged, calculated on the combined declared land and construction value. Owners of homes within the Maritime Zone or on concessions near national parks pay property tax only on the value of the house, not the land itself. For example, property taxes on a home in Dominical outside the Maritime Zone, with a combined land and house value of $300,000, would be approximately $750.

Costa Rica real estate - Beachfront Properties

In most cases, beachfront properties are untitled because the ownership and possession of the shoreline is governed by the Maritime Zone Law (Ley Sobre la Zona Maritima Terrestre) which restricts the possession and ownership of beachfront properties. By law the first 200 meters of beachfront starting at the high-tide markers is owned by the government. Of the 200 meters, the first 50 are deemed public zones and nobody may possess or control that area. On the remaining 150 meters the government, through the local municipal government, will lease the land by way of concessions to private individuals.