The cost of living
Life in Costa Rica is generally less expensive than a comparable lifestyle in the U.S. Many expats there say they can live simply on $1,500 (U.S.) a month.
Rents in some rural and select urban areas for a fully furnished apartment or small house are generally $300 to $600 U.S. The rent also usually includes Costa Rican style amenities such as bathrooms equipped with electric showerheads.
A lifestyle of relative luxury with full-time housekeepers and a lavish, 3-bedroom home in the Central Valley can be had for about $3,000 U.S. a month.
A meal in a moderately priced, sit-down restaurant with salad, main course and a glass of wine costs $15 to $20 U.S. per person. You can buy enough fruits, vegetables, meats, and fish to feed a small family for a week for $20 to $40 U.S..
You may spend a bit more on transportation as gasoline and diesel fuel are expensive but you can make it up on entertainment. For example, trips to museums, outdoor concerts and street fairs generally cost less than $5 U.S. a person.
Here are some other price comparisons, Costa Rica vs. the U.S.
Costa Rica United States
Rental of 3-bedroom, 2-bath house $300-$2000 $500 to $3000
Internet $38 $34.95
Home phone service $3.80 $29.95
Cell phone (400 anytime minutes w/taxes) $21.96 $30.99
Basic cable TV $30 $39.99
Electricity (per KwH) $0.08 $0.1063
Private Health Care (annual cost for male
55-59 yrs.) $900. $3695
Native Costa Rican dishes are big on rice and beans. Meals are generally wholesome and priced reasonably. Breakfast is often Gallo Pinto, the national dish of fried rice and black beans. Lunch often features Casado – rice and beans with cabbage, fried plantains, tomato salad and a meat.
Surprisingly enough, vegetables are not a large part of the Costa Rican diet. In fact, Costa Rica home cuisine usually offers an inordinate amount of fried foods.
Here’s another surprise. Seafood such as lobster and shrimp are not a big part of Costa Rican diets because most of it is exported. So, the stables tend to be beef, chicken and fish.
Costa Rica has no national drink but one very popular one is Horchata, a cinnamon flavored cornmeal drink. Another is Fresco de Frutas which is essentially a fruit salad floating on a base of kola and water. Coffee is Costa Rica’s “grain of gold.” However, much of the really good stuff is exported.
Only income you earn in Costa Rica is taxed. If all your income derives from social security, a pension, or investments in some other country, you will pay no Costa Rican income tax.
Property taxes are low. Private residences are taxed at the rate of 0.25% of assessed value with almost all homes assessed at far less then what you actually paid for the property. As an example of this, taxes on a $150,000 house are typically just a few hundred dollars a year.
There is a 13% sales tax and transfer taxes are also assessed on the sale of property and vehicles. The transfer tax on cars is 1.5%.
Real estate in Costa Rica
There are few restrictions on property ownership in Costa Rica. However, the country does have a complex legal system governing the ownership of property and the transfer of titles.
The country has many good attorneys, any one of whom can streamline this process for you for a comparatively modest fee. However, even after your attorney says that the title of the property is clean and valid, it’s a good idea to take out title insurance. Mistakes do happen, especially when dealing with government bureaucracy and title insurance will protect you from any possible problems. Title insurance in Costa Rica is relatively inexpensive – usually amounting to only about 0.5% or less of the purchase price of your home.
Be careful if you are considering beachfront property as Costa Rican Maritime Laws impose restrictions on foreign ownership. Be sure to research the matter carefully before investing in any beachfront property. Also, be aware that the government owns the first 200 meters of beachfront starting at the high-tide markers. And of those 200 meters (656 feet), the first 50 (164 feet) are deemed public zones.
Costa Rica is situated near the equator and is a tropical country. Most of the country has temperatures of 71o F. to 81o F. However, the mountainous areas above 2000 meters (6551 feet) enjoy much cooler temperatures.
The country has two major seasons – rainy and dry. The dry season runs from January to April and the rainy season from May to November or December.
Retiring to Costa Rica
If you decide to become a resident, your application will be processed by the Costa Rican Department of Immigration. You may choose to apply for a Rentista or Pensionado Residency. The Pensionado Residency is meant for retirees.
To obtain a Pensionado residency, you will need to demonstrate a permanent, fixed income from a pension or some other source of at least $1000 U.S. a month. This can be from Social Security retirement benefits or from either a government or private sector pension.
To get a Pensionado residency, you will be required to prove that the required funds were deposited in Costa Rica each year and exchanged into the local currency. You are also required to reside in Costa Rica for at least four months each year.
You apply for Pensionado status at the Costa Rican consular office in your area. You will be required to show documents such as a birth certificate and a letter (or letters) certifying your income. Your local consular office can provide a list of all the documents you will need as part of your application.
The official language in Costa Rica is Spanish, though many people also speak English. Several of the Costa Rican government’s publications stress the importance of learning Spanish, especially if you intend to become a resident. The country has many good Spanish language schools and you may be able to learn enough to at least get by in just a few weeks.
Costa Rica’s economy is heavily dependent on tourism, agriculture and electronics exports.
The country’s per capita GDP (Gross Domestic Product) is $10,900 U.S. However, it has the second highest inflation rate in Latin America (13% in 2008) and 23.9% of its people live below the property line.
Costa Rica has universal health care and one of the best health care systems in Latin America with more than 30 hospitals and 250 clinics throughout the country. The universal health care is called Caja Costarricense de Seguro Social (CCSS) and provides low-cost services to the Costa Rican populace, as well as to foreign visitors and residents.
However, you will need to get used to red tape and long waits, factors that are always typical of nationalized health care.
There is also private health care available that is both affordable and of high quality. Many Costa Rican doctors were trained in the U.S., Canada or Europe and speak excellent English. There are three large, private hospitals used by most expats – Clinica Biblica in San José, CIMA hospital in Escazú, and Clinica Católica in San José-Guadalupe.
Clinica Biblica and Clinica Catolica both offer first-class, ultra-modern services but cost considerably less than anything you would find in the U.S.
As a rule, private health care in Costa Rica costs less than what you would pay in the U.S. A private office visit with almost any medical specialist costs only about $40. Dental work is also cheaper.
Costa Rica, with its amazing biodiversity, is a nature lover’s paradise. Cartago is world renowned for its rich ecological diversity and dense tropical rainforests along the mountain ranges near the Irazu and Turrialba Irazu volcanoes.
Many visitors come to Cartago to visit its principal church, the enormous Basilica de Nuestra Señora de Los Ángeles.
The Museo del Oro or Museum of Gold in San José should definitely be on your list of places to see. It is located under the Plaza de la Cultura Park and has thousands of examples of pre-Columbian gold with pieces ranging in dates from 500 BC to 1600 AD.
There are about 4,000 items on display at the Museo de Numismática. This includes bills, coins and many documents showing the early history of Costa Rica.
San José is also the home of the Costa Rican Symphony, which has a nice symphony hall, and Teatro Nacional, the National Theater.
Teatro Popular Melico Salazar has shows the year around that include live theater, dance and art. It is located in central San José on Paseo Colon.
San José also has a Children’s Museum, the Museo de Arte y Diseño Contemporáneo – (Museum of Art and Contemporary Design) and Costa Rica’s National; and its National Archives.
Where to retire in Costa Rica
While you can enjoy a comfortable retirement just about anywhere in Costa Rica (except maybe the rain forest), there are three areas favored by many expats. They are San José, Guanacaste and Tamarindo.
San José. As previously noted, San José is the capital of Costa Rica and has much of what the country offers in the way of cultural events. It has housing at a variety of prices – as does just about any large metropolitan area. For example, one house in San José was recently listed at $115,000 while the asking price of another was $188,000. The $115,000 house has two bedrooms and two baths, while the more expensive house has three bedrooms and two baths and was updated in July of 2010. On the more expensive side, a house with three bedrooms, two baths, and 1,200 sq. ft., located at the center of San José West was advertised for $335,000.
Guanacaste. Guanacaste offers beautiful beaches, a stunning shoreline, great bird watching, excellent surfing and superb snorkeling. It also has a mountain lake for windsurfing. Given all the things Guanacaste has to offer, it’s no wonder that so many retirees have chosen to live in this North Pacific province.
One home recently listed for sale in Guanaste’s Playas Del Coco, located just 1.5 blocks from the beach, fully furnished with granite countertops, five bedrooms, 3 1/2 baths and 1,900 sq. ft. had an asking price of $199,900.
Tamarindo. This region is known for its great surf and stunning beaches and features one of the most easily accessible diving sites in the country. Its town of Tamarindo is becoming increasingly popular as more and more people discover the sunny beaches, endless coves and pristine shorelines that are just a short walk from Tamarindo.
Most homes in the Tamarindo area are priced on about the same scale as the rest of Costa Rica. A 3-bedroom, 4-bath house was recently listed at $595,000 U.S. However, there was also listed a 2-bedroom, 2-bathroom house for $149,900 and a five-bedroom house with 10,000 sq. ft. at $495,000.
Costa Rica has friendly people, an amazing biodiversity that makes it a nature lover’s dream come true, dazzling beaches, mountains, reasonably priced real estate and retirees from the U.S. pay no income tax. These are just a few of the many reasons why Costa Rica is on the list of the world’s top 10 places to retire.