Costa Rica Real Estate – This is part of our series on buying real estate in Costa Rica. We hope to provide information needed to make an informed decision about purchasing land, condos, houses or commercial property in Costa Rica. If you want more information about this property or buying real estate in general you can request the free e-book, “Secrets of Buying Real Estate in Costa Rica”
As a foreign buyer we are aware of your many concerns when purchasing properties and investing your money in Costa Rica. Almost everyone who is interested in investing in real estate in this tropical country is asking about incorporating, purchasing property and acquiring status of residency.
When buying real estate property in Costa Rica the first thing buyers should do is check the property’s information in the centralized Public Registry in Costa Rica. Almost all of the real estate properties in Costa Rica have a titled registration number or Folio Real, and the real estate property records database may be searched using the Folio Real number, name index or ID number. The search result contains all data on the property including ownership, land area, property boundaries, mortgages, encumbrances and other liens. Take note though that there are still some properties that are not yet digitized but are listed in special books kept in the Public Register.
Now what if you have already seen a property you want to buy, do you go and make an offer for it right away? Not yet. First you have to know if you are being offered an occupation rights or ownership rights. The difference between the two is that with ownership rights the land is properly registered and documented, meaning you will own the property just like the concept of owning land in the US or Canada. On the other hand, with occupation rights you would be dealing with a property that is not registered, cannot be searched through the Public Registry and may bring about hassle due to the long judicial process you need to see through for the land to be properly registered.
Another thing you have to take into consideration if you are planning on buying a beachfront property or land that borders lakes, reserves and national parks is the concession. Concession properties are governed by specific regulations stipulated by the Costa Rican government. It means that the property is owned by the government but is leased to a private party for a specific period of time. Unlike other types of properties, the registration for concession properties has set requirements when it comes to zoning, terms, occupation, and more.
Once the nitty-gritty of the property ownership has been covered and verified, the next step is the actual purchase of the property you are interested in. The most efficient way to purchase land or property in this country is by buying it in a corporation’s name. Remember that the corporation’s name must be unique and not similar to any existing corporation or trademark.
There are two most commonly used types of corporations for buying property, namely “Sociedad de Responsabilidad Limitada” and “Sociedad Anónima”, which are both governed by the Costa Rican Commerce Code. In both cases, shareholders (for Sociedad Anónima or S.A.) or quota holders (for Sociedad de Responsabilidad Limitada or S.R.L.) are only liable for their shares on the corporate capital but their own personal finances or assets are secured from any obligation or liabilities the company may incur. Also, both types of incorporation offer investors the same range of possibilities for conducting business with the same level of individual asset protection. On the other hand, the S.R.L. is much simpler than S.A. and uses its special features to work on the buyer’s/investor’s favor. For example, with S.R.L. shares cannot be transferred to non-shareholders without the explicit approval of the shareholders and it does not require more than one person (Manager) for the company administration unlike S.A. that requires the company to have a Board of Directors composed of three members and a Comptroller that must be occupied by different individuals of legal age.
Property Ownership Types
Is the Property Really for Sale?
What is the Maritime Zone?
Myths About Squatters
Construction, Architects & Engineers
Purchasing Under a Corporation
And so much more……..