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”
You can make a huge return on your investment if you put your money in real estate; however, you have to understand that it also comes with risks especially when you are purchasing real estate property in a foreign country like Costa Rica.
In every country there are con artists and scammers just waiting for unwary travelers and investors to victimize and they come in all shapes and sizes. They all seem friendly, all-knowing and some are even from your home country. These people are good at making victims feel comfortable, at ease and great at making small talks.
To avoid real estate scams when making a real estate investment in Costa Rica, please review the tips and reminders we have prepared below:
- In Costa Rica there is no standard license requirement for real estate agents which means that anyone and everyone can be an agent. An individual need not undergo a certain type of training or education, take a test or must have an experience to be a real estate agent. This practice may lead to different kinds of problems especially if you hire an under-qualified agent who may give you ill-advice, present over-priced properties or sell properties with legal issues just to make a commission. Furthermore, since there are no regulations governing real estate agents in Costa Rica, if they do anything that may hurt your business or real estate deal there is nothing you can do to make them liable for the wrong they did.
- Unlike North America there is no nationally sanctioned Multiple Listing Service (MLS) in Costa Rica so you cannot check out all the properties available for the same price in a certain area and you cannot assess the exact price of a property in a specific area or region. Also, because of the absence of a nationally sanctioned MLS you will not be able to get a fair viewing of all available properties that meets your qualification from a single agent.
- You may find yourself finding the exact same property listed at different prices from different agents or companies and it is entirely due to commission structures, overpricing and internal deals. The trick is to do your own research to do a comparison shopping and always negotiate on the price because you will never find out what you can get by asking.
- Legal documents are written in Spanish so before agreeing or signing any document make sure that you completely understand the terms written to avoid any problem. If anything is written in English check the Spanish version and make sure that they are identical. It is wise to seek out professional help especially if it is a significant purchase.
- Know what you are buying, the exact plot size and all that comes with it. For example if you are buying a beach front property or a property that is near a creek or river you have to know that you cannot build anywhere that is a few meters from the creek or beach so it is pointless to buy the piece of land that is within the specified areas you cannot build on.
- Make sure to do due diligence on the property you wish to purchase to ensure that all documents are in order, property taxes are paid and that lien and encumbrances are lifted before you pay for non-refundable down payment or deposit.
- Do not hire the same lawyer as the seller. Acquire services from a lawyer who will look out for your best interest and will ensure that there are no hidden risks with the property purchase.
- Verify that there are phone, water and electric services in the property you are purchasing because in Costa Rica it is especially difficult to set up new utility services.
- Do not count on verbal agreements and handshakes. Remember that in Costa Rica only written documents count so if it is not in paper it never existed.
- You are not guaranteed a property until after closing and a lot of things could happen which could cause you to lose the property you are purchasing so you have to be very diligent until everything is in order and the property is in your name.
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……..