Investing in Costa Rica: An Interesting Option
About the Author
Herman Duarte, founder of Simple Legal Consulting, is an immigrant from El Salvador who, after living in Costa Rica for 13 years, is now a proud Costa Rican. He holds master's degrees from Stockholm University and the London School of Economics and Political Science. Passionate about writing and research, Herman is widely recognized as one of the top lawyers in the region and a leading expert in investment and immigration law in Costa Rica. Drawing from his personal experience as an immigrant, Herman uniquely understands the challenges of navigating the immigration system and is dedicated to helping others successfully transition to life in Costa Rica.
According to statistics from the Costa Rican Ministry of Tourism, from 2010 to 2020, there was a sustained increase in the number of annual visitors, starting with 2 million tourists and peaking at 3.1 million. Naturally, this peak declined due to the unnamed pandemic, which resulted in only 1 million tourists visiting "Tiquicia," the land of "Pura Vida," in 2020.
According to statistics from the Costa Rican Ministry of Tourism, from 2010 to 2020, there was a sustained increase in the number of annual visitors, starting with 2 million tourists and peaking at 3.1 million. Naturally, this peak declined due to the unnamed pandemic, which resulted in only 1 million tourists visiting "Tiquicia," the land of "Pura Vida," in 2020.
However, Costa Rican tourism has recovered. In 2021, it reached 1.3 million, and for this year 2022, it is expected to surpass the 2 million visitor mark. It is forecasted that in 1 or 2 years, the number of annual visitors will exceed 3 million, who can arrive on one of the more than 500 direct flights per week that connect the country. On average, each tourist stays 12 days in the country and spends an average of USD$1500. This average excludes multimillionaires, who are increasingly attracted to Costa Rica, as evidenced by the more than 422 private jets that landed at Liberia International Airport, just an hour away from the beautiful—and luxurious—beaches of Guanacaste.
The success of this recovery undoubtedly stems from government policies focused on the conservation of flora and fauna, to the point that Costa Rica is described by National Geographic as "the most biologically intense place on Earth in terms of biodiversity" when referring to Corcovado National Park, which is just one of 30 national parks and 149 protected wildlife areas.
The charm that Costa Rica leaves on its visitors motivates them to want to stay connected to the country. They achieve this by buying land and properties, as there is no restriction for foreigners to own real estate. Thousands are enchanted by the idea of purchasing apartments, beach houses, etc., to list them on Airbnb, obtaining an almost guaranteed return of 8-12% on their investment. Developers have recognized this market, creating truly impressive spaces—buildings with more than 15 amenities, ranging from sports facilities, cinemas, rooftop beaches, meeting rooms, coworking spaces, to dedicated concierge teams to make Airbnb administration much easier. In other words, there are apartment towers that already have specialized personnel to receive Airbnb tourists.
But the good news doesn't end there. In July of last year, the Law for the Attraction of Investors, Rentiers, and Pensioners No. 9996 came into effect for a window of just 5 years. This law grants tax and immigration benefits to those looking to invest in Costa Rica: (i) if you invest USD$150,000, you can obtain residency to legally live in the country, which is a bargain compared to the $500,000 required by Panama or the millions required by the USA; (ii) the capital you bring from abroad will not be taxed, giving the green light for the entry of foreign capital; (iii) freedom to import 2 vehicles (yachts, cars, planes) tax-free; (iv) exemption from paying import taxes for household goods.
What types of investments are allowed in Costa Rica to obtain residency?
A) Real estate or registrable goods: They must be registered in the name of the individual applying for residency.
B) Shares: From a company duly registered with the tax authorities.
C) Securities: Acquired through a stock brokerage house duly registered with SUGEVAL.
D) Projects of national or productive interest: Must demonstrate a declaration of public interest.
E) Venture Capital Funds: Acquired through an Investment Fund Manager duly registered with SUGEVAL.
F) Sustainable infrastructure projects.
Of course, like any country, Costa Rica is not perfect, but Costa Rica has been and remains a safe bet for those looking to diversify their investments and explore life in this Central American country, which is a member of the OECD and is about to join the Pacific Alliance. Pura Vida!
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