Buying Property in Costa Rica
The first thing a prospective buyer should do is align themselves with a buyer’s agent. We specialize in the Buyer’s Agent role. We work with all other offices to present you the full inventory of available properties. We schedule the showings, accompany you on each tour and provide analysis of each property. Based on your criteria and our local intel, we work together to formulate offers, negotiate on your behalf and arrive at the best deal possible for your property.
The offer consists of four key points – purchase price, initial deposit (typically 10%), closing date (often 30 days), and any contingencies. Normal contingencies are a property inspection for a house/structure and a topographical survey. There may be additional contingencies for a hotel or business, as each deal is unique. Once an offer is accepted, your attorney will draft the Sale and Purchase Agreement (SPA). This spells out the terms in greater detail and provides the conditions for closing. Once the SPA is signed by both parties, buyers make their initial deposit into the escrow account and attorney begins the Due Diligence process. They will ensure the property has a clean and transferable title and that the property is up to date with bills and taxes. This is also when inspections and/or surveys are performed. Upon reviewing and approving the Due Diligence report, and both parties meeting closing conditions, the closing will take place where the deed or “escritura” is transferred to the buyer. This deed transfer is recorded in the protocol book of the Notary Public and filed in the National Registry. The National Registry maintains digital archives for additional safeguarding of property.
Closings costs
It is customary for the buyer to pay closing costs. However, this is sometimes negotiated. The main closings costs are based on the transaction price. They are:
- 1.51% transfer tax
- 0.9% stamps and duties
- 1.25% notary fee
Your attorney will also charge for services provided during due diligence. This can range from as little as $500 or less to several thousand dollars for a more complex transaction, such as buying a hotel with many employees, permits, vendors and accounts. Lastly, as most properties are held in corporations for ease of transfer and limitation of liability, the cost to set up a corporation ranges from $800 – $1200 with most firms.
You can rest assured that Evolve Realty will support you through the entire property purchase and beyond closing.