When someone moves to Costa Rica, one major decision they will have to make whether to buy a car and/or just use the excellent public transportation system. If they plan on living in San Jose, it is a wise choice to use the public transportation until one gets the feel of things.
A common misconception among foreigners coming to Costa Rica is that you will save money by bringing a car here from overseas.
There are just a few of the drawbacks:
- You still have to pay the import duties, which is the main reason cars are so much more expensive here. Plus insurance and shipping costs.
- You’ll have to go through the process of clearing the car through customs, either yourself (god luck) or with a customs broker (who will obviously charge you)
- If you buy a new car from a dealer in the US, the guarantee won’t be valid here.
- The car may be damaged in shipping or have parts stolen in transit. While the insurance you buy may cover this damage, it probably won’t. Especially if the damage may have been pre-existing or not related to the handling of the container.
If there is some compelling reason you must purchase abroad, you will pay the following rates on cars, SUVs and pickups. Less than 3 years old – 59.33%, 4-5 years old 70.63% and 6 or more years old 85.32%. Brand new cars purchased at dealers here have about 20%worth of duties applied to the price. These rates are applied not only to the Black Book value of the car (regardless of the purchase price), but also to the shipping and insurance costs.
More about this go to Shipping, Importing a Vehicle to Costa Rica
Buying a New Car from a Dealership
Fact the fact, new cars in Costa Rica run about 30% more than new cars in the U.S. This is more or less the import tax amount. Any difference higher than 30% would be due to higher prices the dealer pays to the factory, model popularity, or because of a better reputation locally. Or bluntly putting it, a specialty car like a Hummer or Limo will cost an arm and leg.
One of the things you must understand, Costa Rica is laxed in safety features and do not expect to get some of the standard accessories as a car you would buy in the US. That GPS may not come with the car as advertised on U.S. TV.
Also, few new cars are made specifically for the Costa Rica market with special engine tuning, motor sizes and suspension. Some brands that aren’t very popular in the US, like Suzuki, are excellent choices because of price and are stripped to the bear bones to make the car affordable to Costa Ricans. Cars that are popular have specific selling points like high clearances and Four Wheel Drive. What to watch for if seeking to buy a new car from a dealer.
- Financing has improved dramatically in the last several years, but rates are higher than in the U.S. Foreigners who don’t have legal residency or “authorized” income sources may encounter difficulty with financing, regardless of your credit rating.
- Check the popularity locally of the car in the secondary market. The more popular and respected cars will obviously retain their resale value better, and will offer more options when you need parts later.
- Check out the dealer’s reputation, service center and time they have been in business. L y S, Purdy Motor, Agencia Datsun, EuroAutos, VETRASA & VEINSA all have excellent reputations for inventories of parts, service, and carry popular brands. Not that you have to stay away from others, but you have to do more research on them before buying.
- “New” cars – Most brands only have one authorized dealer, because Costa Rica is a small market. But some makes have dealers that bring in 0 km cars that are “like new”. Often these are last year’s models that haven’t sold in Korea and are shipped here. This isn’t to say that they aren’t good deals, you just have to read the ads carefully so that you know what you’re getting.
Buying from an Individual vs. Used Car Dealer
The used car dealer offers several advantages. The principle one being that they are legally bound to offer a 30 day guarantee on the transmission and motor. While a good mechanic will more than likely be able to steer you away from a real lemon, this guarantee is nice to have. Another advantage is that they can offer you financing on the cars they sell and they’ll take your car as a trade in, saving you the hassle of selling it.
Another big advantage is that most dealers are direct importers. It’s no secret that the roads in Costa Rica are hazardous to the health of your car. If you purchase a car that is just coming into the country, you are assured of getting a car that has suffered much less abuse when compared to any car that has circulated in Costa Rica for a few years. This obviously benefits the mechanical condition of the car a great deal. Also, many cars now are coming from Korea, which is small country with great roads. That means low mileage and generally good overall condition.
There are 2 scenarios where buying from an individual could be better. One case would be buying a 1 owner car from someone who you know is very meticulous about the care and maintenance of their vehicles. Another case may be from someone who is leaving the country and who is desperate to sell the car at any price before they go.
However, be careful in buying a car from like Craig’s Lists or any other free ad place. If you find a car that is well below market value advertised, be very careful why the price is so low, because normally there is several reasons. 1) The car has forged docs or stolen. 2) The owner imported the car,and has not pay the import taxes, which when you registered the car, you will get nailed or the car impounded.
What Makes and Models are the Best for Costa Rica
The 3 most popular brands in Costa Rica have always been Nissan, Hyundai, and Toyota, but since the Toyota recalls, that has changed. Before, you could not go wrong for several reasons.
1. Parts are readily available in almost any area of the country.
2. Parts are generally less expensive than any other brand.
3. These cars hold their resale value very well.
4. Mechanics are familiar with these cars and have the necessary equipment for diagnosis and repair.
Suzuki, Mitsubishi, Honda are also good brands that are popular and solid choices. You have much more freedom if you plan to buy a new car from a dealer and drive it into the ground, but it still won’t hurt to keep the above factors in mind. For example, Puegot has entered the market here in a big way and will probably be 1st tier status within the next year or two.