Costa Rica vs Mexico: where should you retire?

Costs are broadly similar — roughly £2,100/month for a couple in Costa Rica and £2,100 in Mexico.

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Can a foreigner buy property?

Costa Rica: Foreigners can buy and hold titled property with the same freehold rights as Costa Rican citizens. The main exception is the Maritime Zone: the first 200 metres from the high-tide line, where the initial 50 metres are public and the next 150 metres are usually held under renewable concession rather than outright title.

Mexico: Foreigners can own property, via a bank trust (fideicomiso) in the restricted coastal and border zones.

Retirement visas

Costa Rica: The Pensionado residency suits retirees with at least US$1,000 a month of lifetime pension income, while the Rentista route uses stable unearned income or a bank deposit; both are renewable and can lead to permanent residency.

Mexico: Temporary and permanent resident visas suit retirees who meet income or savings thresholds.

Healthcare, tax & lifestyle, compared

Healthcare

Costa Rica: Costa Rica is well regarded: legal residents join the public CAJA system by income-based contribution, alongside excellent private hospitals such as CIMA and Clinica Biblica in San Jose. Many keep private cover too, which is good value.

Mexico: Private hospitals in the big cities and expat hubs are good and far cheaper than in the US or UK, with English-speaking doctors common in expat areas. Legal residents can enrol voluntarily in the public IMSS scheme for roughly US$500-700 a year, though it excludes some pre-existing conditions, so many pair it with private insurance.

Tax on your pension

Costa Rica: Taxation is territorial, so a resident's foreign pension and overseas income are not taxed in Costa Rica, only locally sourced income is. That makes a UK or other foreign pension straightforward to draw here, though you keep any home-country obligations.

Mexico: Temporary residents are generally not taxed on foreign pensions for their first years, and even permanent residents who become tax-resident benefit from double-tax treaties and foreign-tax credits that usually keep the bill low. Whether you are tax-resident turns on your centre of vital interests, so take advice.

Climate & everyday life

Costa Rica: Tropical with a dry season December to April and a greener rainy season May to November; the Central Valley stays spring-like around 22-27C year-round while the coasts are hotter and more humid. Safe by regional standards with everyday care against petty theft; Spanish is the language but English is widely used in expat and tourist areas, and driving is on the right.

Mexico: Hugely varied by altitude: the central highlands around Lake Chapala and San Miguel enjoy a spring-like climate year-round, while the coasts are hot and humid with a May-October rainy season. The dry winter months are the most comfortable. Safety varies sharply by region, so the settled expat towns are calm while some areas are best avoided; they drive on the right, and English is widely spoken in expat hubs though Spanish helps everywhere else.

Cost of buying

Costa Rica: Expect total one-off costs of about 5-6%: a 1.5% transfer tax plus registry stamps, with the balance for notary and legal work; foreigners are treated like locals outside restricted coastal concession zones. Purchases usually complete within a few weeks.

Mexico: On the coast or near a border, foreign buyers hold property through a bank trust (fideicomiso), which adds a setup fee and annual charge. Expect total closing costs of about 5-8% inland and 7-12% where a trust is needed, including acquisition tax (ISAI) of 2-4% plus notary and registration; completion often takes one to two months.

Where expats settle

Costa Rica: The Central Valley towns of Escazu, Santa Ana, Atenas and Grecia for a spring-like climate and expat services, plus Guanacaste (Tamarindo, Nosara) and the Central and South Pacific (Uvita, Dominical) for the beach.

Mexico: Lake Chapala and Ajijic for a large, established lakeside expat community; San Miguel de Allende for colonial charm; Merida for a safe, cultured city in the Yucatan; and Puerto Vallarta for beach living.

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