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I just finished a Q&A article with Chris Howard
“In general, property taxes run 0.1% of the declared value of a home or condo. Thus, a home valued at $100,000 would mean paying $100 yearly.”
http://www.foxbusiness.com/personal-finance/2011/08/04/costa-rica-new-florida-for-retirees/
Is that right? I seem to remember seeing different inforamtion here on this site somewhere.
[quote=”billdog”]”In general, property taxes run 0.1% of the declared value of a home or condo. Thus, a home valued at $100,000 would mean paying $100 yearly.”
[/quote]The municipalidad declares the value of the property and if the figures are correct one of three things has happened in the last 3 1/2 years.
Assuming that the answers are correct either:
1 ~ My property taxes are about .00125% of value
2 ~ My property has increased in value by 33% in that 3 1/2 years. Or
3 ~ The municipalidad is over declaring the value of the property.I wish that the property values had increased by 33% but I don’t believe it 😯 or the tax rate is actually higher than 1%. 😉
I don’t want to think that the municipalidad is over declaring the value. 😡You can take your pick of the above reasons but our taxes here are dramatically lower than they were in the States.
Unless something changed overnight without any of us being notified, Mr. Howard is wrong.
Standard property taxes are 0.25% of the value of the real estate and now there is also a luxury property tax.
“The target of this tax are all the owners, individuals or corporations, of houses, apartments, condominiums and every building used for housing purposes even if they are within the Maritime Zone which worth more than US$197,238 based on the Official Value Guideline used by the Costa Rican Tax Administration”
From Costa Rica Tax Expert Randall Zamora. See more details and the sliding scale at: [ https://www.welovecostarica.com/members/2865.cfm ]
Scott
Scott Oliver is the author of: 1. Costa Rica Real Estate Scams, 2. How To Avoid Them, How To Buy Costa Rica Real Estate Without Losing Your Camisa, 3. Costa Rica’s Guide To Making Money Offshore in Bull & Bear Markets and 4. ¿Cómo Comprar Bienes Raices en Costa Rica, Sin Perder Su Camisa?
Scott is right on target. We bought our home two years ago, last year our property tax increased approximately 50%, incorporating the luxury property tax. Compared to the $4,500.00 a year property tax on my home in the U.S., I have no complaint.
Our home in Atenas is worth approximately $275K and our yearly taxes are just under $400. We found out that if there has been a mortgage on the property (under the previous owner) the taxes are likely to be higher.
We have friends with properties worth far more who are paying 1/2 of what we do. We asked our attorney if there was a way to “challenge” the current taxes. He nicely told us that he could certainly ask the municipality to do so BUT…..that there was a good chance that our taxes could go higher based on the new inspection. We wisely left well enough alone. We also feel that our taxes are SO fair and are happy to be contributing to the community.
If you are buying a home, check with the municipality for the actual amount of property taxes.
Interesting, Chris. I knew that if a mortgage is registered on the property the face value of the mortgage becomes the taxable value of that property. Hadn’t thought about the implications should the mortgage be discharged.
Is your home owned in a corporation which you purchased? I wonder what would happen if you sold the property to another corporation for a lower value. Might the taxes go down?
Of course if you did that you’d be subject to the transfer tax as well as the legal fees, etc. Never mind . . .
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