There are many qualities that make Costa Rica the perfect place to make a real estate investment, its political and economic stability, the fact that it is the second most pacific country in Latin America, and of course the wonderful weather, nature and people; however, investing in a foreign country raises a lot of questions and this is why the first step should always be to consult a real estate attorney and get all your questions out of the way.

Among the most common inquires that foreign investors have is how to invest in Costa Rica through your IRA (Individual Retirement Account).

An IRA can be used for offshore investments, but of course there are limitations and things you can and cannot do, which is why getting advice from your financial adviser and lawyer is a must to ensure that you go about it the right way.

Many custodians do not allow the use of IRA for real estate investments so most likely you will need to transfer it to a self-directed IRA which allows real estate investments; when you are using your IRA to invest in real estate in Costa Rica, the same rules and restrictions apply as if you were buying real estate in the USA, in other words, the property must be used for investment purposes only; this means that the property you are getting must be rented and or eventually can be flipped; when you retire then you can take it over for personal use should you desire to use it as a retirement home for instance, but while it’s in the IRA it’s only an investment and it cannot be used or “leased to” any “disqualified person” either (spouse, parents, grandparents, children or grandchildren).

The process of purchasing the property in Costa Rica through your IRA can be done easily with the help of an experienced real estate attorney, likely they will recommend the use of an LLC. You can choose to invest in a property on your own or make an investment along with other buyers.

Another recommendation is that you choose the property you are investing in wisely, if you are thinking about finding the ideal home to eventually retire in Costa Rica but in the meantime have it as an investment, you’ll be smart to choose a home within a gated community in an area that will represent a large ROI if you decide to sell for any reason, and preferably through a developer that offers property management services. Bellazo by Kalia Living in Nosara, Guanacaste is a perfect example.