author Call Us: +506 2289 5125

Compare Listings

Real Estate FAQ | Is renting or buying better?

Real Estate FAQ | Is renting or buying better?Is renting or buying better is a Costa Rica Real Estate FAQ that you can grow old discussing. The answer to the question if renting or buying is better is not the same for everyone. This depends on a large number of circumstances and options that differ from person to person. It depends on your up bring, your lifestyle, your income and your goals in life.

Since our weekly blogs are being read by both Costa Ricans as well as foreigners, I’d like to give you the facts. Then, you can decide if renting or buying is better for you.

For a resident or citizen


If you are a resident or Citizen of Costa Rica, you can apply for a mortgage. Bank mortgages in Costa Rica run around 9.5% – 30 years fixed in US dollars (*May 2018) with a 20 – 30% LTV (Loan to Value).

Purchase vs paying rent

A $150,000 condo pays around $850/month rent. This will be a total rent in 30 years of $306,000, not taking into account any raises in rent.

You can be the legal owner of the same $150,000 with an 80% mortgage at 9.5% at 30 years which will cost you $363,249.02 + $30,000 = $393,249.02. For $1,009/month (after the $30,000 earnest money), the condo will by yours.

Add to the $1,009 another $250/month for property tax, insurance, and HOA fees.

For a non-resident

If you’re not a legal resident, I suggest you ask yourself the question if renting or buying is better. You’ll have a lifetime of having to pay rent ahead of you and you will save a lot of money by buying.


As a non-resident, you cannot apply for a bank mortgage. The only way to purchase is by buying cash or with owner financing. Creative financing, like using your retirement funds such as an IRA or 401K is possible but restrictions apply.

Other options

Paying cash

Do you have enough cash to purchase a house or condo? An option other than buying would be to rent and invest your savings well. In Costa Rica, a CD pays around 2% annually. $150,000 will supply $3,000 toward your rent. You will need to find an investment that will pay you 6.8% annually to cover your rent without eating up the principal.

Unsecured personal loan

If you’re a US national with a credit score of 640 or higher, with a verifiable income, there is now a solution: an unsecured personal loan. Read more about this option by clicking on the banner below.

Real Estate FAQ | Is renting or buying better?

Feeling home

While homeowners tend to upgrade their property constantly, tenants depend on a landlord for this. A landlord might not give a tenant the same possibilities of turning a condo into a home by adding personal touches to the home.


Renting will give a tenant more flexibility in moving to a better location when getting a new job elsewhere. Children might need to travel longer to go to a specific school

Moving elsewhere

If you plan to move elsewhere, the answer to renting or buying will change the picture totally.

Renting or buying?

When renting, all rents paid during the time you rented, are gone.

When buying, there is a chance that your property will appreciate. The more land you own, the bigger the chance is for appreciation. A condo in Costa Rica will likely depreciate, usually at 2% a year. This depends a lot on the location, the quality, and maintenance of the building as well as the unit. By selling with a profit or with some loss, you will always recover most or all of your investment.

Furthermore, it is a fact that renting or buying should be an easy decision based on the numbers mentioned above if you need a mortgage. But your children will not inherit anything from you except if you’ve been able to save elsewhere.

As you see, the #1 MLS in Costa Rica tries to give you all the necessary tools so you can make better decisions. Therefore, if you’d like to receive more information or a showing appointment, contact us now.

Feel free to leave your comments on this blog. If you like this article, please feel free to share it on your social media.

Contact the AE MLS Costa Rica

If you like this blog, connect with me on Google+ or subscribe to our newsletter by clicking the banner below.

 Click here to subscribe to The Easy Times

While we’re at it, I DO want to remind our readers that we appreciate any referrals you can send us. Finally, please remember the American-European real estate Group’s agents when you refer a real estate agent. Because we DO appreciate your business.

Facebook Comments

Ivo Henfling

Your West-side of San Jose real estate agent, covering Escazu and Santa Ana, Rohrmoser and Ciudad Colon. If you are looking to buy a home in Costa Rica or invest in a condo anywhere in the Central Valley or looking for any property for sale in Escazu or Santa Ana, you need to contact Costa Rica real estate agent Ivo Henfling. Ivo has been selling Costa Rica real estate on the westside of San Jose, in the locations of Rohrmoser, Sabana, Escazu, Santa Ana and Ciudad Colon for over 20 years and can show you hundreds of happy buyers of real estate in Escazu and those other areas. For Ivo, a deal is not a good one unless both buyer and seller are happy.

Related posts

How Important are Digital Marketing Tools for Real Estate Advertising?      

Estimated Reading Time: 5 Minutes Digital marketing has completely changed our business. For...

Continue reading
Ivo Henfling
by Ivo Henfling

6 Signs of Roof Damage that Needs Repair

Estimated Reading Time: 5 Minutes Many homeowners do not realize that they have roof damage...

Continue reading
Ivo Henfling
by Ivo Henfling

FAQ | Property Tax and other taxes to pay when buying property in Costa Rica

Don’t you want to know how much property tax to pay before buying property in Costa Rica? Learn...

Continue reading
Ivo Henfling
by Ivo Henfling

Join The Discussion

This site uses Akismet to reduce spam. Learn how your comment data is processed.