Legal Considerations
What every foreign buyer should understand about the legal framework for property ownership in Costa Rica.
Titled Property vs. Concession Land
The majority of properties in Costa Rica are fully titled and registered in the National Registry. These carry the strongest ownership rights. Concession properties, located within the Maritime Zone (the first 200 meters from the high-tide line), are governed by a separate legal framework and cannot be owned outright — they are held under a concession granted by the municipality. Understanding which category a property falls into is the first step in any due diligence process.
The Maritime Zone (Zona Marítima Terrestre)
The first 50 meters from the high-tide line is public domain and cannot be owned or occupied. The next 150 meters (the restricted zone) can be held under a municipal concession. Foreign nationals cannot hold a concession directly unless they have held legal residency for at least five years. Concessions are typically held through a Costa Rican corporation with local shareholders. This is one of the most important legal considerations for beachfront property buyers.
Corporate Structures
Many buyers in Costa Rica hold property through a Sociedad Anónima (S.A.) or Sociedad de Responsabilidad Limitada (S.R.L.). This provides liability protection, simplifies estate planning, and in some cases facilitates the transfer of property without a full re-registration. Your attorney will advise on the most appropriate structure for your situation.
Due Diligence
A thorough due diligence process in Costa Rica includes a title search at the National Registry, verification of property boundaries (catastro), review of any liens or encumbrances, confirmation of municipal permits and tax payments, and an environmental assessment for properties in sensitive zones. Your attorney conducts this process and it typically takes two to four weeks.
The Role of the Notary
In Costa Rica, real estate transactions are formalized through a notarial deed (escritura pública) prepared by a licensed notary-attorney. The notary is responsible for verifying the legal capacity of the parties, confirming the title, and registering the transfer at the National Registry. Both buyer and seller must be represented, either in person or through a power of attorney.
Property Taxes
Costa Rica's annual property tax is 0.25% of the registered property value. A luxury home tax (Impuesto Solidario) applies to residential properties with a declared value above a threshold set annually by the government, at progressive rates ranging from 0.25% to 0.55%. These are among the lowest property tax rates in the Americas.
The information on this page is general in nature and does not constitute legal advice. Always work with a licensed Costa Rican attorney for any real estate transaction.
We can refer you to trusted attorneys who specialize in international real estate transactions.
Speak With an Advisor