Guide for Canadians Buying Real Estate Property in Costa Rica
Get the straight scoop on buying property in Costa Rica and paying for it online as a Canadian.
Costa Rica is a beautiful, friendly country and buying property in Costa Rica sounds like a dream. However, deciding to purchase property is only a teeny step toward making that dream come true. Before buying a property in Costa Rica, it's crucial to look for helpful resources and learn about the best places to buy, working with realtors, mortgages, citizenship issues and more.
Here we provide a front-line resource about all aspects of buying property in Costa Rica as a Canadian.
Top reasons to buy property in Costa Rica
Costa Rica is a Central American country known for its verdant rain forests, colorful culture, incredible national parks and great weather. The country is boarded by Nicaragua (north), Panama (south), the Caribbean Sea (east), and the Pacific Ocean (west).
Below we consider the top reasons for Canadians buying property in Costa Rica.
Foreigners are welcome. Costa Rica's property market is fair game and Canadians can enjoy the same purchasing rights as locals.
It can be profitable. If you're buying an investment property in Costa Rica, this can be a great source of passive income.
Flexible residency laws and taxation rules. Property taxes are generally low, only 0.25% of the registered property value¹.
The government is deemed progressive. Costa Rica has a strong rule of law, a long history of political stability and a high rate of development².
5 essential steps to purchasing property in Costa Rica
According to a Point2Homes report³, Costa Rica is number three on the list of countries Canadians prefer when making foreign real estate investments.
Whether you're looking for a mountain view, a beachfront view, a jungle view, or a waterfall view, you'll need to complete a few essential steps to get the keys to your new humble abode.
1. Visit and explore Costa Rica
If you want the quickest eye-opener on the Costa Rica property market, simply head down there. Rent a few places in areas of interest and explore until you figure out where you want to live first.
2. Decide how to finance the purchase
If you want to avoid a lot of headaches and red tape, the best way to pay for your home is with cash or a loan from a Canadian lender. You can also get a cross-border mortgage from international banks like Scotiabank, HSBC and Citibank that operate in Canada and Costa Rica.
3. Find a reputable real estate agency
A local and reputable real estate agent can help narrow your options by showing you viable property listings.
4. Get additional help from a lawyer
It's wise to find a lawyer who speaks Spanish and English to handle the paperwork. Of course, hiring a respectable lawyer comes with additional costs, but you'll have more peace of mind if you have a legal expert to fill legal gaps and minimize legal risks.
A lawyer can even help you form a corporation and make a purchase through that corporation.
5. Close the deal
Although your lawyer can handle most of the paperwork, you'll still need to sign the papers, transfer the money and close the deal. A great way to send money to Costa Rica from Canada is via MTFX, with a turnaround time of 24-48 hours. That means your sale can go through faster and you can celebrate with a pop of champagne sooner.
Why exchange rate matters?
Most Caribbean islands peg their local currency against the U.S. dollar, and Costa Rica is no exception. So, although the official currency of Costa Rica is the Costa Rican colón, your main focus should be on the USD/CAD exchange rate. The USD/CAD exchange rate matters because an inferior exchange rate can lead to serious conversion losses, so you'll have to invest more in your property than planned.
If you want to save thousands of dollars in exchange rates, fees, and costs, finding the best way to send money overseas is worth your while.
Need an easy way to keep an eye on the USD/CAD exchange rate? Use MTFX's live rate calculator to make an informed decision before paying.
Where to find the best exchange rates?
When you compare the range of international money transfer services available, it's easy to see they are not created equal. Take, for instance, sending money via MTFX vs. a bank. Although banks appear to be the easiest option, they are generally not the most cost-effective way to transfer money internationally.
Many banks charge high fees on top of less competitive exchange rates and the transfer can take longer (up to 5 days or more).
The better option is an international transfer specialist like MTFX, which offers exchange rates 3-5% lower than banks and low transfer fees.
Paying for your overseas property with an MTFX online account is highly convenient. Additional benefits of using MTFX include guidance from foreign exchange specialists, fast turnaround times (24-48 hours) and access to the best foreign exchange tools.
Paying online without going to the bank
Wiring money should be the least of your concerns when purchasing property in Costa Rica. With MTFX, you can skip the bank trip and log into your account to make the payment anytime and anywhere.
Do you need to make regular online payments to Costa Rica? MTFX's secure platform is powered by industry-leading automated technologies that enable you to set up regular payments with a few clicks. You can save time and money by skipping lengthy banking protocols and unfavorable exchange rates.
How to save more with MTFX exchange rates?
MTFX offers a safe, convenient, and cost-effective way to send property payments internationally. The numbers don't lie – you can save up to $5,000 on property worth $100,000 with exchange rates that beat bank offers by 3-5%.
When you register your account with MTFX, you can enjoy the most optimal way to transfer money internationally.
Buying property in Costa Rica for Canadians – FAQs
How do I make the most of my Costa Rican property buying experience?
Learning Spanish can make life easier as it helps you communicate better with Costa Ricans you may need to associate with, such as real estate agents, attorneys, tenants, etc.
In addition, the more you learn about buying property in Costa Rica, the more you'll feel comfortable making an informed decision. So dig deeper and research the economic and political climate, maintenance, taxes, re-selling, geographical issues, opening a bank account and more.
Can Canadians use RRSP funds to buy Costa Rica Estate?
Yes, Canadians can use some of their RRSP money⁴ to invest in a Costa Rican vacation property, all thanks to the Home Buyers' Plan (HBP) program.
What are the top home buying destinations in Costa Rica?
Coastal towns like Tamarindo, Nosara, Grande, Flamingo, Brasilito, Catalinas and Papagayo are quite popular.
Do I become a resident when I buy property?
No. Canadian citizens do not require a visa to enter Costa Rica. However, if you're planning an extended stay after buying property, you'll need to submit a residency application and get approved.
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Who can use the MTFX payment service?
Individuals and businesses who need to send money in foreign currency internationally can use MTFX’s services. The beneficiary of the transfer must have a bank account for the funds to be paid into.
Personal clients usually use our services to transfer money between their own accounts in two different countries.
Business clients usually use our services to transfer funds to suppliers, fund international operations, or repatriate overseas earnings.
Why should I use MTFX and not my own bank?
MTFX offers currency exchange rates that are 2-5% better than those offered by the banks. Personal clients usually save hundreds of dollars per transfer and for larger transfers, the savings can run into the thousands.
We also offer excellent customer service, dedicated currency specialists, and a 24/7 online platform with best-in-class technology that allows you to complete transfers from any device virtually anywhere in the world.
Business customers save with better currency exchange rates and proven solutions geared towards managing and mitigating foreign exchange risk. Our solutions include forward contracts, market orders, rate alert services, and much more - all backed by great technology and great people.
How do customers send funds to MTFX?
Funds can be transferred via wire transfer, Electronic Funds Transfer (EFT), or ACH payment services. MTFX maintains bank accounts in all major currencies with highly-rated banks. Our banking infrastructure ensures that you can transfer funds to us quickly and securely.
How long does it take MTFX to transfer funds?
Our global network of banking partners allows us to get funds to virtually anywhere in the world quickly and efficiently. Most wire transfers from MTFX will be received by your beneficiary within 24-48 hours. MTFX also offers same-day transfers that are almost instantaneous, as well as low-cost in-country payment services for your less urgent transfers. For further information please speak to one of our currency specialists.
Please read the following update before logging in to your MTFX online account
We have updated our online dealing system to provide you with better functionality, more unique tools and an overall enhanced client experience. MTFX Online 2.0 is now available for your dealing needs. You can begin using our enhanced online portal today.
Please note that the traditional portal will be available for use until MAY 30th 2021 at which point it will be decommissioned.