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5 Mistakes Foreign Investors Make When Buying Property in Costa Rica
Costa Rica has some of the most investor-friendly property rights legislation in Latin America. Foreigners can own property outright, in the same conditions as nationals. There are no restrictions on property ownership by non-residents. But “investor-friendly” does not mean “risk-free” — and without local expertise, even sophisticated international buyers make costly mistakes.
Mistake 1: Skipping Title Due Diligence
The Costa Rican property registry is public and searchable — but interpreting it correctly requires legal expertise. Liens, encumbrances, boundary disputes, and incomplete title chains are more common than buyers expect. A thorough title search, conducted by a local attorney, is non-negotiable before any purchase.
Mistake 2: Buying in the Maritime Zone Without Understanding the Rules
The first 50 meters from the high-tide line in Costa Rica is inalienable public property. The next 150 meters is regulated Maritime Zone — and the rules governing concessions in this area are complex and location-specific. Many buyers discover too late that their beachfront property does not carry the ownership rights they assumed.
Mistake 3: Relying on the Seller's Attorney
In Costa Rica, the notary who closes a transaction is often retained by the seller — but legally represents the transaction, not either party. Foreign buyers should always have independent legal representation reviewing the contract, the title, and the closing documents before signing anything.
Mistake 4: Ignoring Infrastructure and Water Access
A property with stunning views and a reasonable price may have no ASADA water connection, no building permits approved, or road access that becomes impassable in rainy season. These are not cosmetic issues — they affect feasibility, habitability, and resale value significantly.
Mistake 5: Not Understanding the Full Cost of Ownership
Beyond the purchase price, buyers should account for transfer taxes (1.5% of the registered value), notarial fees, annual property taxes, homeowners association fees, and — if the property is held in a corporation — annual corporate taxes and accounting fees. The carrying cost of ownership is manageable but must be modeled into the investment case.
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