Buying property in Costa Rica can be incredibly rewarding—but it’s also very different from buying in the U.S. The key is understanding the process, avoiding common traps, and working with the right people.

Here’s a clear, practical breakdown of the top steps, barriers, and biggest mistakes 

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Top 10 Steps to Buying Property in Costa Rica

1. Define Your Ownership Strategy

• Personal name vs. corporation (common in Costa Rica)
• Corporation helps with liability, taxes, and resale flexibility

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2. Hire a Reputable Real Estate Attorney (Not Just an Agent)

• There is no MLS system like the U.S.
• Your attorney is your most important safeguard

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3. Verify Property Title

• Use the National Registry to confirm:
  • Ownership
  • Liens or debts
  • Property boundaries

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4. Understand Property Types

• Fee Simple (fully owned)
• Concession land (especially beachfront—government-owned leases)

Many foreign buyers misunderstand this—a huge risk area

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5. Conduct Due Diligence

Your attorney should check:

• Zoning laws
• Water availability (critical!)
• Building permits
• Access roads (public vs private)

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6. Make an Offer & Sign Purchase Agreement

• Typically includes:
  • Deposit (often 10%)
  • Due diligence period
  • Closing timeline

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7. Set Up Escrow

• Use a third-party escrow company (not always standard)
• Protects both buyer and seller

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8. Close Through a Notary Public

• In Costa Rica, a notary is a specialized attorney
• They register the transaction officially

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9. Register Property

• Ownership becomes official only after registration
• Done through the National Registry

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10. Plan for Ongoing Costs

• Property taxes (low, but exist)
• Luxury home tax (if applicable)
• Maintenance, HOA, utilities

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Biggest Barriers to Overcome

1. Lack of Regulation

• No centralized listing system
• Anyone can act as an agent

Solution: rely on trusted attorneys and verified agencies

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2. Language & Legal Differences

• Contracts are often in Spanish
• Legal system differs significantly from U.S. norms

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3. Water & Utilities

• You cannot build without legal water access
• This is one of the #1 deal killers

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4. Concession (Beachfront) Restrictions

• Foreign ownership limitations in maritime zones
• Requires extra legal scrutiny

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5. Financing Challenges

• Local financing is rare for foreigners
• Most deals are:
  • Cash
  • Seller financing

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6. Infrastructure Variability

• Roads, internet, and electricity vary widely by region
• Rural vs tourist areas differ greatly

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Biggest Mistakes Buyers Make

1. Skipping Legal Representation

• Using only an agent = major risk
• Always hire an independent attorney

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2. Assuming “Beachfront” Means Ownership

• Many properties are concession land
• You may be leasing, not owning

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3. Not Verifying Water Availability

• You can own land and still not be allowed to build

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4. Overpaying Due to Lack of Comps

• No MLS → pricing can be inconsistent
• Do market comparisons manually

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5. Falling for “Too Good to Be True” Deals

• Especially:
  • Unregistered land
  • Verbal agreements
  • Cash-only pressure

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6. Ignoring Access Rights

• Some properties lack legal road access
• This can make them nearly unusable

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7. Not Visiting Multiple Times

• The rainy vs. dry season can completely change perception

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8. Not Understanding Taxes & Corporate Costs

• Annual corporation fees if you use one
• Reporting requirements

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9. Trusting the Wrong People

• “Friend of a friend” deals often go wrong
• Always verify credentials

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10. Buying Based on Emotion (Vacation Syndrome)

• Falling in love with a view → ignoring red flags

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Pro Tips (From Experienced Buyers)

• Spend at least 2–3 visits before buying
• Rent in the area first (Playa del Coco vs. Nosara vs. Uvita are VERY different)
• Use escrow even if not required
• Get everything in writing—no exceptions
• Budget an extra 5–8% closing costs

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Bottom Line

Buying in Costa Rica is safe if done correctly, but the system puts more responsibility on the buyer than in the U.S.

If you:

• Hire a strong attorney
• verify title + water + zoning
• understand concession vs fee simple

You’ll avoid 90% of the problems foreign buyers face.

FAQs

Do foreigners have the same property rights as locals?

Yes, foreigners can own property outright in Costa Rica, except for certain restrictions on concession land in maritime zones.

What is concession land and why is it risky?

Concession land is government-owned and leased, often in beachfront areas, and comes with restrictions that require careful legal review.

How important is water availability when buying land?

It is critical. Without a legal water source, you cannot obtain building permits, making the land unusable for development.

Should I use a corporation to buy property?

Many buyers do, as it can offer legal and financial advantages, but it depends on your long-term plans.

Is escrow required in Costa Rica?

No, but it is highly recommended to protect both parties during the transaction.

How long does the buying process take?

Typically 30 to 60 days, depending on due diligence and registration timelines.

Can I get a mortgage in Costa Rica?

Financing options are limited for foreigners, so most purchases are cash or involve seller financing.

What are typical closing costs?

Closing costs usually range from 5% to 8% of the purchase price.

Do I need to speak Spanish to buy property?

Not necessarily, but having bilingual legal support is extremely helpful.

Is it better to rent before buying?

Yes, renting allows you to understand the area, climate, and lifestyle before committing.