Costa Rica Real Estate Information for Buying and Selling
Costa Rica Real Estate has the potential to fulfill the dreams of many and so far has proved to attract people from all over the world to a land of peace and natural beauty. The warm weather, majestic mountain ranges, serene beaches, political stability and the value of land have lured people all over Costa Rica.
Clearly, real estate transactions are at a peak compared to previous years. The sustained growth of title transactions is making the economy stronger.
Since you are on this site, you are probably interested in the real estate market in Costa Rica and are considering investing in property here.
However, before you do, you should know that successfully acquiring property in Costa Rica and most foreign countries can be tricky at the best of times. You may find language barriers, different laws from your home country and people who might want to take advantage of you and your money. It is always wise to get help from a respected real estate agency like Karen Real Estate which can provide guidance, security, advice and above all, a professional service.
This article’s objective is to provide guidance regarding real estate transactions in Costa Rica to help you get through this process successfully and hopefully make your experience a rewarding one. Pay attention to the following tips:
- Costa Rica ranks fourth in the world for foreign investments. Because there are very few restrictions to foreigners owning land in Costa Rica, they enjoy the same rights as citizens and do not require any special conditions to purchase property here. The Constitution of gives the right to all to own property in Costa Rica. Foreign nationals have the same rights as Citizens. According to Costa Rican legislation, corporations, in any of their varieties, can be completely owned or controlled by foreign entities or individuals. There is no need for Costa Rica citizens to be members of the Board of Directors or shareholders.
It is important to remember that if you are out of the country for an extended period of time, you must protect your property in order to avoid problems with squatters. To be on the safe side, you should not leave your property unattended for more than 6 months. This is especially true for agricultural and rural land. Remember, SQUATTERS HAVE RIGHTS HERE.
- Even though Costa Rican law requires at least 2 persons to create a corporation, it allows for one or all of the shareholders to transfer or sell all of the shares (100%) to one individual or company. This means that even though a corporation can not be created with just one person, after it has been recorded and created, it can exist with only one shareholder.
- Every property, house, building, etc, is subject to a property tax. The municipal government is in charge of collecting the tax which amounts to 0.25% of the property’s value.
- All Costa Rican properties are registered at the Registro de La Propiedad (Property Registry) which keeps track of all title registrations. You can verify the status of a title or claim associated with the property thru their webpage: www.registronacional.go.cr if you know the Folio Real Number which is included in the cadastre map of the property.If there are no legal problems with a property, acquiring clear title is fairly simple process. The Title Registry system is fully computerized and one of the most highly developed in Latin America.
- Building and subdivision plans must be:
A. Signed by a registered local engineer.
B. Approved by the Health Department.
c. Approved by the Instituto de Vivienda y Urbanismo (INVU) (Housing and Urban Development Department)
- Costa Rica beaches can not be privately owned. The first 50 meters (164 ft.) above the mean high tide line is public territory. No one can restrict access to a beach or claim a beach is privately owned, exceptions being landholdings in port areas, old land grants or by some agreement made prior to 1973. Along 80% to 85% of the coastline, the 150 meters (492 ft.) after the first 50 meters (164 ft.) are called the Maritime Zone and are controlled by the government. A foreigner must establish five years of residency to own more than 49% of a lease in this zone. Take a careful look at the zoning laws before you start development in any of these areas.
- Property transfers require the buyer and seller to execute a public deed before a Costa Rican Public Notary (whose concept is different than the one in many other countries such as the US, Canada or the United Kingdom and is required to formalize all transactions dealing with real estate.
- In addition to the performance of a title search, when the property is owned by a corporate entity, it is essential to perform a corporate search at the Commercial Section of the public register. since only this step will allow to verify that the entity transferring the property is in good standing as well as that the proposed signatory of the transfer deed has sufficient authority to do so.