Welcome to Tropical Felgate, your source for
Costa Rica real estate.
We
are featured on UK Channel 4, Telegraph, Living Abroad
magazine,
Homes Overseas magazine, A Place in the Sun
magazine and Scotland on Sunday.
Costa Rica has recently caught many eyes as a hot tourist spot
but also as a great place to purchase real estate. With so much
public attention and a vast number of tourists visiting Costa
Rica every year, the country offers a great investment
environment for real estate. Below are seven great reasons to
invest in Costa
Rica Real Estate.
1. Stable Government:
Costa
Rica is a democratic republic with three branches
of government and has enjoyed one of the most democratic
governments in Latin America. As of 1948, Costa Rica abolished
it’s army and since 1949 has enjoyed its peaceful democratic
existence, often being referred to as the “Switzerland of
Central
America”. The government is one of the people and one that very
much sees the value of tourism. Over the past few years the
government has incentives foreigners to come and retire in Costa
Rica. Stable government ensures that the money you put into your
property is safe. Political turmoil will never be a reason for
illiquidity in your Costa Rican investment and also provides
reason why Costa Rica is a great place to buy. There are many
other locations around the world that investors think of to go
and buy, but stability is very important and should play a huge
factor in anyone’s investment decisions.
2.
Stable Currency:
Investors want to know if their money is safe in Costa Rica
Stability of the government has helped to maintain a solid and
stable currency.
The Costa Rican colon, also denoted as CRC is the official
currency of Costa Rica.
Colones come in notes of 1,000 up to 10,000.
US Dollars are also accepted as legal tender in Costa Rica.
Both are widely accepted and exchanged throughout the country
with approximately 90% of the places of business in the
country accepting the US Dollar.
3. Tax
Incentives:
This seems to be the one everyone loves! As mentioned earlier
the Costa Rican government has created one of the most
attractive investment environments in Latin America.
Capital Gains Tax= 0% in Costa Rica. The capital gains taxes
are exempt for a business, if the money is derived from an
activity that is not the normal course of business for the
company (This exemption is established through the use of SA,
or Sociedad Anonima). Property Taxes in Costa Rica = 0.25% for
the properties with declared value of up to US$200,000. This
rate is significantly lower than most places in the world. As
a result people are buying in Costa Rica which increases
demand and ultimately increases value. There are not many
places where you can buy a piece of property that has
incredible appreciation potential with such low holding costs.
Corporate Tax: The Sociedad Anonima (S.A.)
These forms of corporate structures allow owners of property to keep
their names away from the corporations they own (literally translates as
“anonymous society”). Ninety percent of all property in Costa Rica is
purchased through these S.A.’s. When a property owner purchases property
through these S.A.’s they use a shareholder’s loan to fund the purchase.
Rental income generated is taken out of the corporation as dividend
income and deducted against the initial investment and thus no taxes are
paid.
Income Tax: Only income generated in Costa Rica is subject to income
tax. Costa Rica offers large amounts of income to be deductible and free
from any tax
**all tax information should be verified by independent tax
professional.
4. Proximity to Major N. America Cities:
When investigating vacation destinations and environments for second
homes or investment property, it is important to factor travel times to
the destination. Costa Rica’s proximity to major N. America Cities gives
even more reason why investors are buying property in Costa Rica. Great
tourist destinations need to be close and easily accessible.
Major US and Canadian Carriers offer direct flights to and from Costa
Rica from the following international airports (3-5 hour flight times)
-Miami
-Houston
-Atlanta
-Dallas
-Chicago
-New York
-Los Angeles
-Toronto
5. Healthy Local Economy:
For baby boomers and entrepreneurs, spiralling costs of living abroad,
oppressive taxes and government regulation in the US have placed Costa
Rica high atop the list of places to retire without sacrificing standard
of living. This is what savvy investors are looking for!
6. No Ownership Restrictions:
Foreign Ownership is promoted in the country of Costa Rica. In many
foreign countries fee simple title is only available to locals and
without titled ownership your investments can be at great risk. All
foreigners enjoy the same rights as Costa Ricans when it comes to real
estate ownership. Titled, fee simple properties are all registered in
the National Registry of Costa Rica properly protecting your ownership
rights.
7. Excellent Lending market:
Prior to 2006, there was no market for lending in Costa Rica and
investors bought and sold property on a cash basis. With the recent
surge by worldwide and US lenders as well as the strengthening of the
Costa Rican market, financing at reasonable rates is now an available
option. This addition to the real estate industry has made it possible
for many more investors to buy property in Costa Rica and will only
increase the demand over time.
As you can see there are many great reasons to invest in Costa Rica.
Many people believe that it is too late to make any money. This is not
the case! The time is now to invest in this beautiful country and
incredible vacation spot.
