by Joseph 
When it comes to selling property in Costa Rica, understanding the real estate sale cost Costa Rica is crucial for both buyers and sellers. Whether you’re planning to sell your home, land, lot, condo, or any other type of property, knowing the fees, taxes, commissions, and other expenses involved can help you prepare financially and avoid surprises during the transaction.
My name is Yossi Kaplan, MBA, Realtor, and I specialize in Costa Rica’s real estate market through the Nosara Realty Group. In this article, I’ll walk you through the typical costs you can expect when selling property in Costa Rica based on extensive research, expert insights, and direct experience working with lawyers, builders, and sellers in the region.
Table of Contents
- Understanding the Real Estate Sale Cost Costa Rica
- Summary Table of Real Estate Sale Costs in Costa Rica
- Importance of Legal Representation and Due Diligence
- Frequently Asked Questions (FAQ)
- Final Thoughts
Understanding the Real Estate Sale Cost Costa Rica
One of the first things to understand is that the total cost of selling property in Costa Rica usually ranges between 4% and 6% of the property’s sale price. This estimate includes several components such as legal fees, transfer taxes, realtor commissions, escrow fees, and other smaller charges like documentary stamps and registry fees.
It’s important to note that while I provide a comprehensive overview here, this is not financial or legal advice. Always consult with a qualified Costa Rican lawyer and accountant to get precise figures tailored to your specific transaction.
Breakdown of Key Costs When Selling Property
Let’s break down the major costs you should expect when selling real estate in Costa Rica:
- Legal Fees: Typically around 1.25% of the sale price, plus an additional 13% value-added tax (VAT) on the legal fees themselves (not on the entire sale price).
- Transfer Tax: A government tax of 1.5% of the purchase price.
- Realtor Commissions: Usually between 5% and 6%, though these fees can be negotiated. In some cases, they may reach up to 10%, especially for lower-priced properties.
- Escrow Fees: These typically range from 0.25% to 0.5% of the property price and cover the service of holding funds securely during the transaction.
- Documentary Stamps and Registry Fees: Additional minor costs including around 1% for stamps and around 0.82% for registry fees.
- Due Diligence Costs: Title study and property searches usually cost between $500 and $1,000, depending on the complexity of the property and the lawyer’s fees.
Why Are Realtor Fees Higher in Costa Rica Compared to Other Countries?
One notable point is that realtor commissions in Costa Rica tend to be higher compared to countries like the United States or Canada. This is primarily because the average property prices in Costa Rica are generally lower, so realtors charge a higher percentage to maintain a sustainable business.
For example, while realtor fees in Canada or the US might hover around 3% to 5%, in Costa Rica, it’s common to see commissions of 5% to 6%, or even up to 10% for lower-priced properties. This ensures that realtors can cover their costs and continue providing quality services in the local market.
Summary Table of Real Estate Sale Costs in Costa Rica
| Cost Component | Percentage of Sale Price | Additional Notes |
|---|---|---|
| Legal & Notary Fees | 1.0% – 1.5% | Plus 13% VAT on legal fees only |
| Transfer Tax | 1.5% | Government tax on sale price |
| Documentary Stamps | 1.0% | Minor government fees |
| Registry Fees | 0.82% | Property registration |
| Escrow Fees | 0.25% – 0.5% | Service fees for secure transaction |
| Realtor Commissions | 5% – 6% | Negotiable, sometimes up to 10% |
| Due Diligence (Title Search, etc.) | Varies | Typically $500 – $1,000 USD |
Example Calculation for a $50,000 Property Sale
To give you a clearer picture, here’s an example calculation for selling a property priced at $50,000 USD:
- Low Estimate: Approximately $2,440 USD (4.88%)
- High Estimate: Approximately $3,347.50 USD (6.7%)
This means you should budget around $2,500 to $3,500 for selling a $50,000 property in Costa Rica, covering all fees, taxes, and commissions combined.
Importance of Legal Representation and Due Diligence
One of the most critical steps when selling or buying property in Costa Rica is hiring a reputable local lawyer. A trusted lawyer will:
- Provide you with an accurate estimate of the total costs involved in your specific transaction.
- Conduct a thorough title search to verify ownership and ensure the property is free of liens or debts.
- Review any outstanding taxes or legal issues related to the property.
- Prepare and review all legal documents to protect your interests.
While sellers usually provide documents proving their ownership, it’s essential to have your lawyer perform independent due diligence to avoid any future complications.
Planning Your Budget for Selling Property in Costa Rica
Because property prices fluctuate, the exact percentage of costs may vary slightly. For example, if you sell a property for $55,000 instead of $50,000, the fees will adjust accordingly. However, having a clear estimate beforehand allows you to plan your finances efficiently and avoid surprises when closing the deal.
Working with a local real estate group like Nosara Realty Group can also help you navigate the process smoothly, as we can connect you with trusted lawyers and provide guidance tailored to your property and location.
Frequently Asked Questions (FAQ)
1. What is the typical percentage cost to sell property in Costa Rica?
The total cost typically ranges between 4% and 6% of the sale price, including legal fees, transfer taxes, realtor commissions, and other fees.
2. Are realtor commissions fixed in Costa Rica?
No, realtor commissions generally range from 5% to 6%, but they can be negotiated and sometimes may be as high as 10% for lower-priced properties.
3. What legal fees should I expect when selling property?
Legal fees are usually around 1.25% of the sale price plus a 13% VAT on the legal fees themselves, handled by your attorney or notary public.
4. Why are realtor fees higher in Costa Rica compared to other countries?
Because property prices in Costa Rica are generally lower, realtors charge a higher percentage to maintain their business viability.
5. How important is hiring a local lawyer?
It is essential to hire a local lawyer to conduct due diligence, verify title ownership, check for liens or taxes owed, and ensure all legal requirements are met.
6. What other fees can I expect besides legal and realtor fees?
Additional costs include transfer tax (1.5%), documentary stamps (around 1%), registry fees (about 0.82%), and escrow fees (0.25% to 0.5%).
7. How much does due diligence cost?
Due diligence, including title study and property searches, typically costs between $500 and $1,000 USD, depending on the property and lawyer.
8. Can I get an exact cost upfront for selling my property?
Your lawyer can provide a precise estimate after reviewing your property details, helping you budget accurately for your sale transaction.
Final Thoughts
Selling property in Costa Rica involves several costs that are important to understand before you list your home, land, or condo. By budgeting around 4% to 6% of your sale price for all fees, taxes, and commissions, you’ll be well-prepared for the financial aspects of the transaction.
Always work with experienced real estate professionals and a trusted local lawyer to ensure a smooth process and protect your investment. If you have questions or want personalized advice on selling property in Costa Rica, feel free to reach out to me or the Nosara Realty Group.
Thank you for reading, and I look forward to helping you navigate the Costa Rican real estate market!
