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  • The Truth About Real Estate Licensing in Costa Rica

    The Truth About Real Estate Licensing and NAR Affiliations in Costa Rica. Many real estate associations in Costa Rica mislead the public by passing their members off as licensed real estate agents or NAR-approved professionals . The reality is quite different, and here’s why: 1. Costa Rica Has No Formal Real Estate Licensing System Unlike the U.S. or Canada, Costa Rica does not have a national real estate license for agents or brokers. Real estate is an open profession, meaning anyone can call themselves a real estate agent without official government certification. 2. NAR Affiliation Does Not Equal Licensing Some Costa Rican real estate associations are affiliated with the National Association of Realtors (NAR) , but this is often used to create a false sense of legitimacy. NAR does not regulate or license real estate professionals in Costa Rica —it is simply a U.S.-based trade group that offers memberships and designations. 3. The Only Legal Requirement for Real Estate Brokers in Costa Rica To legally act as a real estate broker in Costa Rica, an individual must register with SUGEF (Superintendencia General de Entidades Financieras) . This is not a real estate license but a financial oversight measure designed to prevent money laundering. More importantly, real estate must be the person's core labor activity to qualify. 4. Real Estate Associations Are Private Clubs, Not Regulatory Bodies Associations like CRGAR and CCCBR are private organizations, not official regulatory bodies. While they may offer training or networking opportunities, membership does not equate to government-backed licensing or oversight . What Buyers and Sellers Should Know If you are working with a real estate agent in Costa Rica, don’t be fooled by claims of licensing or NAR approval. Instead: Verify SUGEF registration to ensure they are legally conducting real estate transactions. Check their experience, reputation, and references. Work with a qualified real estate attorney to protect your investment. Bottom Line There is no such thing as a licensed real estate agent in Costa Rica. The only legal requirement is SUGEF registration , and NAR affiliation does not grant any special authority. Always do your due diligence before engaging with any real estate professional. sources: costaricalaw.com livingcostarica.com Costa Rican Commerical Code

  • Tamarindo Real Estate Report January 2025

    First and foremost we would like to wish our clientele a happy, healthful and prosperous new year, 2025. After a rather sideways, neutral year for sales in 2024 in the midst of almost countless new projects being announced for the Playa Tamarindo, Flamingo, Coco, Papagallo, Avellanas and Negra Axis and elsewhere in Guanacaste, we are beginning to see price reductions across the board. While demand is still very strong with AAA grade properties at good price points are selling, there are many more which are showing signs of price weakness. To be sure older, dated builds are out of vogue and mucher harder to sell while new, contemporary homes at proper price points do sell much more readily. The problem arises that many of the newer mid-priced builds were built on the cheap, so maintenance costs of these will be high over time (yes, you get what you pay for even when paying high prices). Whatever the case, newer construction is highly sought after. Returning to falling price points, the market seems inundated with new supply day after day, which coupled with still high interest rates, are putting a damper on sales. Also, many sellers (with the advice of their listing agents) have been artificially pumping prices to the high side in hopes of finding a buyer of the Covid-era mentality, the likes of which simply do not exist anymore. Today's buyers are very well informed, most of whom have been studying our market for years now and generally shop around before purchasing. Having said all the above, there are still brisk sales going on of quality product, particularly new developments at good price points, but the incessant supply of new product entering the market is outpacing demand in the aggregate. We at Sol Realty are always on the leading edge of the best offerings in any given category and will find you the very best deal available each and every time. For our sellers out there, we will always strive to be up front with you and will recommend real, attainable market pricing in lieu of the bait and switch technique which invariably ends with less net sales proceeds to you. Best Regards, Mark Price, Broker-Owner Sol Realty & Investment Consulting

  • General Guide to Costa Rican Real Estate Taxes 2025

    This short summary provides an accurate overview of Costa Rica's tax legislation for landlords in 2025. Understanding these rules can help landlords optimize their investments, stay compliant, and avoid legal and financial woes. Please find the summary of the key information below: Key Points Luxury Tax : Applies to properties valued over $233,900, with rates ranging from 0.25% to 0.55%. Property Tax : Annual rates range from 0.25% to 0.55% based on property value. Payments can be made quarterly or annually. Corporation Fees : Companies pay annual fees ranging from $120 to $380, depending on activity level. Rental Income Tax : Landlords pay 15% on 85% of their rental income under the 15/15 tax system. Capital Gains and VAT : New regulations apply, affecting certain transactions and services. Taxes General Property Tax : 0.25% of the property’s assessed value or purchase price. Property reassessments are required every five years. Taxes are due annually by January 15th. Solidarity (Luxury) Tax : Targets high-value properties exceeding $233,900. Rates vary from 0.25% to 0.55%, supporting social housing programs. Annual Corporation Fees : Active Companies : Fees are based on earnings and range between 15% and 50% of a government employee’s salary. Inactive Companies : Pay a fixed fee regardless of earnings. Taxes Rental Income Rental income is taxed at a flat 15% rate on 85% of earnings. Deductions : Expenses like maintenance, repairs, and mortgage interest are deductible. Improvements and renovations are not. Landlords must issue electronic invoices and report income monthly. Compliance Requirements Monthly Filing : Includes rental income and applicable sales tax (13% VAT for vacation rentals). Annual Deadlines : Property and luxury taxes are due by January 15th. Failure to comply could lead to penalties up to 10x the tax owed. Corporate Tax Considerations Active Companies : Tax rates vary with income. Inactive Companies (Holding Companies with no economic activity) : Pay a roughly $140.00 but must file annual declarations. Allowable Deductions Common deductions for landlords include: Mortgage interest (up to $750,000). Property repairs and maintenance. Depreciation over 27.5 years. Travel expenses for property management. Home office expenses, if applicable. Tax Credits : Energy Efficiency Credits : For eco-friendly property improvements. Low-Income Housing Tax Credits (LIHTC) : Incentives for affordable housing investments. By staying informed and planning strategically, landlords can navigate Costa Rica’s tax landscape effectively, ensuring profitability and compliance. For personalized advice, consulting a tax professional familiar with Costa Rican regulations is recommended.

  • Update Costa Rican Tax Treatment of Rental Income

    As of the last update in 2023, Costa Rica has specific regulations regarding rental income generated from platforms like Airbnb and VRBO. While tax law can evolve, here's an overview of the rules for rental income: 1. Income Tax on Rental Income: Residents and Non-Residents : Both residents of Costa Rica and non-residents who generate rental income from property in Costa Rica are subject to income tax on that income. The tax rate for rental income is typically 15%, but this can vary based on how much income you generate. Personal Income Tax : Costa Rican residents are subject to personal income tax on their worldwide income, which includes rental income from Airbnb/VRBO. Non-Residents : Non-resident owners who rent properties in Costa Rica are taxed at a flat 15% rate on the gross income received from the rental. There are no deductions allowed for non-residents, so the tax is calculated on the total rental amount before any expenses. 2. Tourism Tax: Costa Rica imposes a  tourism tax  for short-term rentals, such as those listed on Airbnb or VRBO. As of recent changes, properties rented for  less than 30 days  are subject to a 13%  Value Added Tax (VAT) . This tax is applicable to rental income and must be collected from the guest at the time of the booking. The tax is  collected by the property owner  or platform (Airbnb/VRBO), who must remit it to the Costa Rican tax authorities. 3. Registration and Licenses: National Tourism Registry : As of 2022, properties rented out for short-term stays (under 30 days) must be registered with the  National Tourism Registry  (Registro de Turismo). This is an official registry managed by the Costa Rican Tourism Institute (ICT). Municipal License : Property owners must also obtain a  municipal business license  (patente municipal) from the local municipality in which the property is located. This applies whether the rental is short-term or long-term. 4. Tax Obligations for Hosts: Hosts are required to file tax returns and pay taxes on their rental income. This includes the  Income Tax  and  VAT . Failure to comply with tax obligations could lead to fines, penalties, and potential issues with the authorities. 5. Responsibility of Platforms (Airbnb, VRBO): Airbnb  and similar platforms are now required to assist with compliance by collecting and remitting the VAT tax on behalf of hosts. Airbnb, for example, collects the VAT (13%) directly from guests in Costa Rica and passes it to the tax authorities. However, this does not eliminate the host's responsibility to report rental income for income tax purposes. 6. Tax Deductions: For  residents  of Costa Rica, certain expenses related to the rental property (such as maintenance, utilities, management fees, insurance, and property taxes) can be deducted from rental income before taxes are calculated. However,  non-residents  do not have the option to deduct expenses—taxes are levied on the gross income. 7. Filing and Payment: Rental income taxes are typically filed  annually  through the Costa Rican tax authority ( Dirección General de Tributación  or DGT). VAT payments are usually made on a  monthly  basis 8. Penalties for Non-Compliance: Failure to comply with these tax regulations can result in significant penalties, including fines and back taxes. Costa Rica has been increasing enforcement on rental income from platforms like Airbnb and VRBO in recent years, so it’s essential for property owners to stay compliant. Key Considerations: Ensure  proper registration  with the Costa Rican Tourism Institute and your local municipality. Collect and remit  VAT (13%)  on short-term rentals. Declare your rental income  and pay the appropriate  income tax  (15% for non-residents). Non-residents cannot deduct expenses against their rental income. Final Notes: Since tax laws can change, and Costa Rican authorities continue to increase enforcement, it’s highly recommended to consult with a  local tax advisor  or accountant to ensure you're in full compliance with both national and municipal regulations.

  • Healthcare Paradise: Navigating Medical Care Options in Tamarindo, Costa Rica

    Beyond the sun-kissed beaches and lush landscapes, Tamarindo, Costa Rica, offers residents and expats access to a healthcare paradise. Boasting some of the best medical facilities in Latin America, the region provides a comprehensive healthcare system with both government-run and private options. Let's explore the healthcare landscape in this tropical haven: Government-Run Healthcare System - Caja Costarricense de Seguro Social (Caja): The backbone of Costa Rica's healthcare, Caja, stands as a testament to the country's commitment to providing affordable and accessible medical services. Expats, specifically legal residents, can join Caja and benefit from low-cost healthcare services, covering everything from check-ups to major surgeries. The monthly fee is a small percentage of the applicant's income, making it an economical choice for many. Private Healthcare System: Costa Rica's private healthcare system offers a blend of affordability and quality. Expatriates often turn to three prominent private hospitals: CIMA hospital in Escazú, Clínica Bíblica, and Hospital La Católica in San José. These facilities, accredited by Joint Commission International, provide first-class services at costs significantly lower than those in the U.S. Private healthcare allows for flexibility in payment, accepting cash or various insurance policies, including some from the U.S. and Europe, international policies, and local Costa Rican insurance. Even without insurance, the costs remain surprisingly reasonable. For instance, a visit to a doctor typically stays around $60, and major surgeries are a fraction of what one would pay in the U.S. A notable addition to the healthcare landscape is the full-service Hospital San Rafael Arcangel hospital in Liberia, just an hour away from Tamarindo. This expansion ensures that high-quality medical care is within easy reach of the northern Pacific coast. Costa Rica's Health and Longevity: Costa Rica consistently ranks high globally for life expectancy, often attributed to the country's slower pace of living, fresh and healthy foods, and the welcoming tropical climate. The Nicoya Peninsula region, part of the northern Pacific coast, is recognized as one of the world's Blue Zones, where residents live longer on average due to a combination of factors. Cosmetic Surgery and Dental Procedures: Beyond traditional healthcare, Costa Rica has become a hub for medical tourism, especially in cosmetic surgery and dental procedures. Modern clinics equipped with contemporary laser technology offer a range of services at prices often 50% lower than in the United States. Cosmetic procedures, knee replacements, hip replacements, dental work, and more are attracting patients seeking quality care without the exorbitant costs. Choosing the Right Mix: Many expats in Tamarindo opt for a mix of public and private healthcare, leveraging the strengths of each. This approach helps navigate potential wait times in the public system while still benefiting from the expertise of private doctors. The accessibility of private care ensures a smooth healthcare experience tailored to individual needs. In Tamarindo, healthcare isn't just a service; it's a vital component of the community's commitment to well-being. Whether you're enjoying the beaches or exploring the vibrant local culture, the assurance of quality medical care adds an extra layer of comfort to life in this tropical paradise. Costa Rica's healthcare excellence stands as a testament to the country's dedication to providing residents and expats with a healthy and fulfilling lifestyle.

  • Tamarindo Real Estate Report-Mid September, 2024

    Sales last month dropped significantly compared to the rapid pace we saw 12 months ago. It seems we have peaked in this 2023-2024 cycle and are now in a holding pattern until after the U.S. elections. Combined with the anticipated rate cuts from the Federal Reserve this month, and possibly a few more beyond that, we could see another rally in real estate prices across the board. Despite the downward trends, AAA-grade properties continue to sell readily and are holding their value. Growth is steadily moving outward, with previously undervalued or remote locations undergoing gentrification and or improvement. At the same time, all overpriced, lingering listings will need to reduce their prices if sellers genuinely want to sell. This "shakeout," as it were, will create a more level playing field for everyone in the future. Currently, we,at Sol Realty are seeing some prime properties available at bargain prices, which we would be happy to share with you upon request. "The Future is Now," as they say, and this adage has never rung more true than at this moment.

  • News Flash Progress Report La Vista Condos

    We are happy to report that progress has been made at breakneck speed with on time delivery planned for December, 2024. There are some fantastic units here still to be had, and we advise to get them now before the price increases come upon completion. Sol Realty has a very close relationship with the developer, so please come see us to schedule a showing and land the very best deal possible.

  •   Today's Reality of Residency Law 9.999

    On February 23, 2023, the regulation of the Law for the Attraction of Investors, Rentiers (Rentistas) and Pensioners (No. 9.996) was published. The purpose of the regulation is to regulate the tax treatment and the procedure for the authorization of this type of residences, aiming to simplify the procedures for the applicant.   Some of the most significant changes with respect to Law No. 9.996 are as follows:   The minimum amount for a real estate investment is established at one hundred and fifty thousand dollars, legal tender of the United States of America (US$150,000) . However, said investment is not permitted under the name of corporate entities, that is to say, it is permitted only if the investment is made under a natural person's name.   The figure of proven income is not acceptable, via the creation of term bank deposits as a means to opt for the migratory category of temporary residence as rentier (rentista).   On the other hand, the regulation provides a series of tax benefits in favor of investors, pensioners and rentiers (rentista), during the first five (5) years of effectiveness of the law . such as,   -The exemption of import taxes to household goods that require the import of instruments or materials for the professional or scientific exercise and, up to two land, air and/or maritime transportation vehicles. These must be held for 10 years, and if sold prior to that all realized tax benefits must be paid back to the treasury.   -Resident investors who have the approval for their category and acquire real estate after the publication of this regulation, may apply for a reduction of up to twenty percent (20%) of the corresponding transfer tax . Those who opt for such benefits must keep the property in their possession for at least ten (10) years and just like with personal property, if sold within the first 10 years the tax benefits must be paid back to the treasury.   -It is important to point out that when the resident investor, pensioner or rentier annuls or renounces his migratory status, he must pay the totality of the taxes from which he was exempted.   -It is noteworthy that even though the original law 9.996 was passed and signed into law on June 21st, 2021 , it's regulation was only published on February 23, 2023 , effectively wiping out 18 months of unrealized tax benefits of the five years (5) allotted as of the bill's passage. Given that the time to process residency applications is currently taking up 12 months at present, if one were to start the residency process now (Sept 2024), one would find himself with only roughly 1.5 years with which to realize the bill's  tax benefits. All the while having to hold said assets for an additional 10 years before selling them in order to retain said tax benefits. In short, one must delve into the details with the proper immigration and real estate attorneys in order to make a decision that fits your needs and future plans.

  • Tamarindo Real Estate Report August-2024

    While sales last month were down in the aggregate, there were still some good sales to be seen if one knew where to look. While these were a hodgepodge of different product, the things all these sales had in common was actually bang for the buck and value. As always, locations were always prime to be sure. Average price ranges were about $1,500,000 and change with newer, undated tropical modern construction preferred. Tamarindo and environs are definitely still experiencing a surge in new construction and supply of many shapes and sizes, all of which will ultimately temper prices into the near future, despite the devaluation of the US dollar versus the Costa Rican colon. Please do not hesitate to contact us at any time our latest off-the-radar deals. Pura Vida. MP

  • Tamarindo Real Estate Report July, 2024

    This green season has been extraordinarily wet, with incessant tropical lows turning our wonderland a lush fluorescent green, especially notable when the sun peeks out every other day or so. The current market has seen a mix of closed sales of high-value, quality properties only, with asking prices dropping daily across all property categories. Meanwhile, new luxury pre-construction offerings are being introduced to the market. One of our favorites is Tamarindo Air Homes, featuring 26 modern tropical townhome units located in the El Tesoro gated-community near the north end of Tamarindo beach. Another highly desirable development is Mono Luxe Suites, offering 2-3 bedroom condo-hotel units with access to the premier beachfront "Mono Loco Beach Club," reportedly Tamarindo's most luxurious beach club ever. Lastly, there's the Almarea, a nine-story mega tower featuring 2, 3, and 4 bedroom ocean-view suites, situated in the hills behind Tamarindo, sure to capture the interest of residents and investors alike. We will provide detailed reports on these developments in future blogs. Despite economic and geopolitical uncertainty globally, organic demand remains strong, with eager buyers ready to act once prices stabilize. There's a significant amount of inventory to absorb before the next market turnaround. Our outlook anticipates prices continuing to decline, with potential stabilization when interest rates adjust downward and following the results of the US election. Pura Vida!

  • Another 14 Year Robust Market Streak Broken Again

    TAMARINDO REAL ESTATE MARKET REPORT MAY 2024 It's evident that our market has undergone significant shifts since its peak in 2022. While there's still considerable activity, it's more akin to a robust tropical disturbance compared to the hurricane of previous years. Quality properties at reasonable prices continue to attract attention, but the challenge lies in the abundance of overpriced listings, revealing a notable discord between sellers, their agents, and market reality. In response, creativity and clear communication with clients and colleagues are becoming increasingly vital, as evidenced by the gradual reduction in asking prices. Regarding the influence of global interest rates, despite our cash-centric market, their impact on the overall landscape cannot be dismissed. Governments worldwide have long engaged in unprecedented money printing, rendering the once-fabled 2 percent interest rates a relic of the past. It's essential to acknowledge that era as a fleeting moment, as we transition to a new reality. Those who weathered the high rates of the 1980s understand that consumers adapt, and historical context suggests that current rates are not as extreme as they might seem. As for current trends, there's a noticeable uptick in demand for eco-friendly and sustainable properties. Buyers increasingly prioritize homes built with environmentally conscious materials and featuring renewable energy sources. This shift reflects a growing awareness of environmental preservation and a desire to reduce carbon footprints. Simultaneously, the luxury property market is expanding, with a focus on high-end amenities and contemporary designs.

  • Tamarindo Real Estate Market Report June 20th, 2024

    Last month's activity was marked by extremes on the outer fringes of the market, with both a few very high-end quality properties being put under contract as well as entry-level ones at reasonable valuations. There has also been a flood of new product entering the market, most of which is junk-to-medium grade with still very high prices for the mediocre offerings; apparently, many agents and their sellers still have not received the memo. There is still a ton of product which needs to drop substantially before it will find any takers. There are some notable exceptions with some very worthy products, such as a particular AAA-grade gated community with prime ocean view lots, which had come down by 15% to 20% off asking after having stagnated for some time. These were almost immediately put under contract upon the price reduction. To be sure there is still plenty of organic demand but very little worthy supply, so our advice to buyers is to act upon good deals immediately and not dillydally, because some 5-10 years from now, or sooner, you will not want to be telling yourself, "would have, could have, should have." Our advice to sellers is to accept the fact that the bull run of 2020-2022 is all but over and to return to reality by pricing your properties competitively. MP

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