The real budget: what it actually costs

The winning bid is not what the property costs. It is the starting point. This lesson builds the full budget so the surprise does not arrive after you have deposited.

The six cost blocks

1. Your bid

What you bid and won. Never below the base for that round: bids under the base are not admitted.

2. Transfer tax: 1.5%

The rate of the tax shall be one and a half percent (1.5%).

The same act carries two rules written specifically for auction buyers, and both matter to the arithmetic:

• It is calculated on your bid. Article 7 states that in cases of award at auction the tax is calculated on the auction price, so the base is what you bid and not some later appraisal.
• You pay all of it. In an ordinary sale the tax is split in halves between seller and buyer. Article 6 provides that in an award at auction the acquirer is liable for the whole of the tax.

It falls due within three months of the execution of the corresponding document (article 7). You can confirm the rate in force on the Ministry of Finance site. Vehicles are subject to their own transfer tax, with its own schedule.

3. Registry fees and stamps

Every registration at the Registro Nacional pays fees plus a list of stamp duties (fiscal, agrarian, municipal, professional associations, and others depending on the act). These are set by law and your notary calculates them together with the transfer tax. Ask for that calculation in writing before you bid, not after.

4. Notary fees

Someone has to formalise the auction into a deed and file it with the Registry. Notary fees are set by an official schedule and depend on the amount of the transaction. Get a quote in advance.

5. Inherited debts

Municipal taxes, condominium fees, fines and interest. The previous lesson explains why these do not disappear with the auction.

6. Delivery and getting it liveable

If delivery has to be pursued, add legal fees and time. And add repairs: a house that spent years in litigation is rarely move-in ready.

Sample budget (base ₡50,000,000)

Winning bid

₡50,000,000

Transfer tax (1.5%)

₡750,000

Registry fees, stamps and notary (estimate)

₡1,200,000

Municipal taxes in arrears (estimate)

₡1,800,000

Delivery proceedings and lawyer (estimate)

₡900,000

Minimum repairs (estimate)

₡3,000,000

Approximate total cost

₡57,650,000

About 15% above the bid. The lines marked as estimates depend on each case: get the real numbers from your notary, the municipality and the condominium administrator. The only fixed figure here is the 1.5% transfer tax.

The cushion rule

And the part nobody mentions: liquidity

At an auction there is no “I'll pay with a loan I'm about to arrange”. You need 50% of the base available on the day, in cash, bank deposit slip or certified cheque, and the balance within three days. No bank approves a mortgage in three business days.

So before you browse notices, the right question is not “what is that house worth?” but “how much can I have liquid this week?”. That number, and no other, defines which auctions you can take part in.