Who should I deal with to assist me in purchasing real estate
in Costa Rica?
IL Costa Rica Realty Group is a member of the CBR. IL Costa Rica Realty
Group is also a member of the NAR (National Association of Realtors),
the regulating board of real estate in the United States. We have over
20 years experience in real estate and financing in Costa Rica and in
the US.
In Costa Rica, there
ISN'T a licensing requirement to practice real estate. Anybody in Costa
Rica can act as an agent to buy and sell real estate. These people are
not legally responsible for any mistakes that may take place during a
real estate transaction.
2. What are the steps that are taken to buy a property in Costa
Rica?
a. Work with a knowledgeable Costa Rican real estate broker to find your
ideal property.
b. Make
an offer on a property and negotiate the price and conditions
that are agreeable to the buyer and the seller
c. Sign
a clear, concise purchase agreement drafted by a Costa Rican
Attorney that is both in English for you to understand and in Spanish,
signed and dated by both buyer and seller.
d. Make
a deposit on the property which is typically 10% of the
agreed upon price. The deposit will be held in the lawyers escrow account
and subject to the terms and conditions set forth in the purchase agreement.
e. Order
a survey on the property to verify size and boundaries of
the property
f. Purchase a
corporation to hold your property
g. Your
representing lawyer will perform the following tasks:
o Extensive Title Search
o Property Reports
o Contingency releases
o Closing Statement
o Distribution of Funds through certified bank checks
o Registry of documents
Properties
are transferred by executing a transfer or conveyance deed
(escritura de traspaso) before a notary public. In Costa Rica, notaries
must be attorneys and are responsible for preparing, supervising the execution
and recording of all public registered documents. Property cannot be transferred
if the land does not have a registered survey, which must be referenced
in the deed of transfer.
If the
property is owned by a corporation, the attorney will perform
a corporate search in the commercial section of the registry to verify
that the corporation is in good standing and that the proposed signatory
has the capacity to sign on behalf of the corporation.
h. The buyer, seller and representing
lawyers will meet on the agreed upon closing date. Once the buyer, seller
and notary sign the transfer deed, the deed is recorded in the notary's
record book and a copy is presented to the Registro for annotation and
registration.
The National
Registry reviews the deed and then registers the property
in the name of the new owner.
The registry
will not record a transfer deed without the full payment
of the transfer taxes, documentary stamps, notary fees and property taxes.
Transfer
taxes and document stamps are approximately 2.5% of the
registered purchase price and notary fees are set by law at 1.25% of the
registered purchase price.
Holding
title in the name of a registered corporation provides greater
flexibility in estate and tax planning, liability and overall management.
The Costa
Rican legal system provides adequate assurances and protections
for foreigners to legally and confidently invest and hold title to property.
But remember to follow the law to protect yourself against any loses.
3. Is Costa
Rican property titled?
Yes, with the exception of concession property which will be described
below? Titled property is the same as you would find in North America
or Europe. All titled public property can be found on the computerized
Costa Rican National Public Registry. The only way a third party can claim
rights to a titled property is if they have a registered lean or encumbrance
on that property. When you buy real estate in Costa Rica, your lawyer
will do a title search to make sure there are no outstanding leans or
encumbrances by consulting the national registry.
4. What is
concession property?
Concession properties are those properties located within 200 meters of
the high-tide line of oceans. The first 50 meters from the
high tide line is public property and cannot have construction.
The next 150 meters can be purchased by an individual but requires a "concession"
in order to construct. A concession is a "right" offered by
the Costa Rican government to use the property for a specified reason.
For example, residential construction, a hotel, a golf course, etc. A
concession can be granted for 20-99 years in Costa Rica. After that time
period, it is the responsibility of the property owner to get the concession
re-granted. This is usually not a problem unless the owner has blatantly
broken the previous concession agreement. Many people have safely bought
concession property if they perform the proper due-diligence. We recommend
only buying concession property if the concession has already been granted
or if the buyer understands the risks involved in buying concession property
without the granted concession
5. Some people
are afraid of buying property in a foreign country. Can I buy title insurance
in Costa Rica to insure my investment?
Yes, there are several companies that offer the same type of title insurance
that is offered in North America. Several huge US title insurance companies
back these companies. The cost is about 3% of the purchase price.
6. Can I
get homeowners insurance in Costa Rica?
Yes, all insurance in Costa Rica is handled by a government agency called
INS. You can purchase insurance for your home, car, business, life insurance,
and most other insurable items through INS. Home insurance is actually
less expensive than comparable insurance in the USA.
7. Does Costa
Rica have property taxes?
Yes, Costa Rica has yearly property taxes based on the value of the property
but they are usually very low. Typically, 0.1% of the property value.
8. Can I
have a North American quality home built in Costa Rica? Can you recommend
a good builder?
Yes, there are many North American builders and architects that have relocated
to Costa Rica that build by US standards. But they have adapted their
building techniques to take advantage of local building material availability
and labor.
IL COSTA RICA REALTY GROUP
maintains a list of builders that we have full confidence in recommending
to our clients for residential and commercial construction.
9. How much
are construction costs in Costa Rica?
A US quality home typically costs $50/sq ft and up depending on materials,
finishing details, etc. This is much cheaper than the cost of building
in the United States.
10. Can I afford to hire a maid or a gardener?
Yes, you can typically hire a full-time maid that does all of the cooking,
cleaning, laundry, and childcare for less than $350 per month. You can
also hire a groundskeeper that will maintain your property, gardens, and
watch your property in your absence for about the same amount of money.
11. Are there zoning laws in Costa Rica?
Costa Rica has zoning laws. But typically, San Jose is the only area that
has different zones. Most other property is zoned for almost any type
of construction.
12. Are there building codes in Costa Rica?
Costa Rica has fairly stringent building codes. Although these codes are
rarely enforced, especially in rural areas. There is still a permitting
process that is required in Costa Rica. Make sure that your builder is
familiar with this process.
13. Can I find a good bilingual lawyer in Costa Rica?
There are good bilingual lawyers that we recommend. They can handle many
legal services including real estate, immigration, corporations, etc.
14. Should I put my property into a corporation?
We recommend putting all major assets in a corporation for several reasons:
it protects a person against having his property attached in a lawsuit
and it allows for much easier transference of the property in case of
future sale.
15. How can
I book a travel itinerary to visit Costa Rica, and what about a real estate
tour or a custom tours depending on my interest?
You can contact us and we will have one of our associates help you plan
your trip. We can help with travel, hotel and rental car reservations.
We offer group and custom tours that will provide you with a world of
information, on the country, the people, living in Costa Rica, what you
need to know about retiring, the laws, and doing business in the country.
And of course, we will make appointments with you to view many beautiful
properties while you are here.
16. Is it possible to own a property in Costa Rica and rent the
property to generate income while I am not there?
Yes. Many people who own property in Costa Rica don't live here permanently.
They live here several months out of the year and rent the property the
rest of the time. IL Costa Rica Realty Group can also help find a person
to rent your property.
17. Are public services available in rural areas of Costa Rica?
It depends on the location. Most properties have electricity and water
brought to the property boundary and it is the responsibility of the owner
to bring those utilities to the structure on the property. Most areas
of Costa Rica have land line telephone or cell phone service. Many of
the larger cities in Costa Rica have cable television and all areas of
Costa Rica have satellite (DSS) television.
18. I've heard about squatters taking over property in Costa Rica.
Is this true?
Yes, If a property is left unattended for a long period of time, it is
possible for a squatter to take possession of a property. But the squatter
can usually be removed from the property without any legal problems within
the first few years. If a person waits longer than that, then the owner
with incur some legal costs to remove the squatter. We recommend that
a property owner hires a local person to maintain the property in his
absence. That includes checking on the property on a frequent basis and
notifying the police if an unauthorized person appears on the property.
The caretaker can also perform general landscaping on the property to
keep the property looking nice. Due to the low cost of manual labor in
Costa Rica, the costs of these services are pretty minimal.
19. How can
I find the best property for me?
We have many ways to help you find your perfect property; we have agents
in all parts of the country. Just tell us what type of property you are
looking for, price range and location and we will get to work locating
the right property for your life style and at the best price.
20. Why don't all of your properties have pictures?
Some of our properties are listed by individuals or by other brokers who
don't have access to digital photography and they haven't sent us a picture
to scan into our database.
21. What is the local currency in Costa Rica? Are your property
prices listed in US Dollars?
Costa Rica uses the Colon as its base currency but also recognizes the
US Dollar.
All of our properties are listed using the US Dollar
22. Can I use your company to help sell my property?
Yes, go to our list your property section of our website and fill out
the form. We will put your property in our database right away.
23. What if my question isn't on this list?
Please contact us and we will help you all we can.
24.don't
speak Spanish. Can I get around Costa Rica?
There are over 20,000 North American residents in Costa Rica, so it isn't
hard to find an English speaking person. And many Costa Rican's speak
English since the number one industry in Costa Rica is tourism. If you
live in the coastal areas, the majority of the people that live there
are English speaking. There are very good Spanish schools in Costa Rica
that can quickly improve your proficiency in Spanish.
25. How is
the weather in Costa Rica?
The weather in Costa Rica depends on the location. San Jose, the capital
of Costa Rica, offers a constant year round temperature of about 75 degrees.
The beaches are warmer with high temperatures in the 90's. And the mountains
can reach freezing temperatures. The two distinct seasons are: dry season
and wet season. Dry season is usually November through February. And the
wet season is March through October. There is very little rainfall during
dry season and it tends to be hotter and windier. During the wet season,
there is usually an afternoon shower, which tends to create cooler temperatures.
26. How is
the health care system in Costa Rica?
Costa Rica has an excellent medical system which keeps diseases in check,
through public education programs and preventive medicine. Most people
have access to universal health care means that people do not hesitate
to visit the doctor when needed. The system covers everything from dentistry,
to maternity care, to open-heart surgery. As a result, Costa Rica's population
is very healthy and enjoys a life expectancy comparable to that of North
Americans.
27.Can foreigners
own property in Costa Rica?
Yes, there is no restriction to property ownership by foreigners
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