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”
Making a real estate investment abroad has tons of perks that come with it but there are also high risks that you have to take on, so it is understandable that you would want to make a considerable profit out of this investment while spending less time managing the property. In order to achieve that, due diligence and thorough analysis must be done.
Before making the ultimate decision of buying any land or standing structure, the first thing you have to determine is whether you are being offered an ownership or occupational rights to the property. There is a huge difference with these two types of rights. With ownership rights, the land is titled and registered with Costa Rica’s Public Registry, while with occupational rights you would be dealing with an untitled property which would have to undergo lengthy judicial process in order for it to be registered properly. To avoid any hassle it is highly recommended that you buy a property that is properly registered as it would save you time, money and energy.
When it comes to restrictions, there are just a few none placed when it comes to foreign property ownership. However, no one, not even locals, can privately own any property that is within 50 meters from the ocean and it is, and always will be, a public property according to the law. On the other hand, the next 150 meters after the 50-meter coastal zone is owned by the municipality and can be leased at a pre-determined length of time in the form of a concession. A foreign national cannot lease a concession land all by himself; for him to lease a land that is under concession, he must have a Costa Rican partner who will own more than 50 per cent of the company doing the leasing. Leases on concession land are usually 5 up to 20 years, but can be extended depending on the ruling of the municipality governing the area. The only zone which cannot be bought and owned by foreigners is land that is within two kilometers of the national frontiers and borders.
For those who are interested in buying condominiums, you have to understand that in Costa Rica it means differently. It could be single family residence projects, finished lots, and typical US style town homes and apartments that are governed by a specific law called “Condominium Law”. This law provides certain benefits to developers like setting restrictions, regulations and privileges that has to be followed by the individuals who purchased the property in such a development. It is important that you get a copy of the by-laws to check the architectural guidelines, restrictions and limitations placed on the property since developers usually use “Condominium Law” to build private roads in a development and set forth specific architectural guidelines.
Now that we have determined which properties you can and should consider buying, the next step is to know how you are going to purchase a property. Usually, foreign investors purchase properties by forming a corporation. Establishing a corporation in Costa Rica may cost you around $500, plus it has to be 50 per cent owned by a Costa Rican national. Rest assured though that once the sale of the property has gone through, the local resident can sell half of his/her share to the purchaser. A word of caution though, a trusted and reliable attorney should be involved with this type of transaction to ensure that it will go smoothly and hassle free.
In addition, before you buy any property in Costa Rica, no matter how interested you are, remember that it is important that you check the property records and other pertinent paperwork to make sure that the purchase is legal, and that water and all other necessities are working properly.
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……..