Posts tagged Caribbean Style

In the mid 1990′s I had a chance to vacation to Costa Rica several times. After having seeing Jamaica on previous vacations I knew my desire to invest in a vacation rental property grew.

What I saw in Costa Rica were safe area’s, the best beaches in the world and a beautiful countryside. Much like the US housing market, real estate in Costa Rica skyrocketed over the years and soon, $200,000 would barely get you a place. Again, like the US housing market the chance to own a piece of property in Costa Rica is a great one! I instantly grabbed a “pre-construction” condo located in Manuel Antonio and use the “Absentee owner” program to manage my investment. Back then, property was relatively cheap and $100,000 could buy you a lot, now with prices stabilizing you can find a house or condo worth the investment.

The prices are stable and absentee owner programs are an easy way to have your property pay for
itself. Thats what I used and continue to use on properties I have an interest in Costa Rica. Generally, you pay the management a commission of anywhere between 30% to 50% (50% is fairly high).

This is after all costs for the property are payed, if a condominium then a monthly association fee will apply. However even after paying the commission, owners can expect a return of at least 10% on the investment through rental AND still be able to use the property at no cost for a set period of time each year so you have your own getaway that is paying for itself. Costa Rica is becoming one of the number 1 tourist destinations in the world and being able to own a piece of property there is amazing!

Many celebrities and even ordinary people are investing in Costa Rica. With a stable government and friendly culture, investing is fun and weather you want a small jungle house to a large Caribbean style home with pool and all we are the right choice. We will guide you through the process including attorneys and make the process smooth and the investment the right one for you.

Buying Real Estate in Costa Rica

The natural beauty, pleasant climate, and friendly people of Costa Rica, are luring investors from
around the globe. The purchasing of Real Estate is one of the first and most expensive decisions
they will make, and professional advice and assistance from a knowledgeable and professional
Real Estate Broker, is the best assurance of a smart decision and a safe investment.

Land values in Costa Rica have been steadily rising over the past 10 years, and there is every
reason to believe it has only just begun for this tropical destination. Costa Rica’s past growth, and
obvious future growth ensure that Real Estate investors will continue to enjoy an excellent return
on their investments and re-sale market, both in terms of increasing land values, and an ever-
increasing amount of qualified buyers.

Ownership of Land

Costa Rica’s laws and constitution, based on a well-developed tradition of Democratic
government, include secure property rights for the private ownership of land. These laws are
extended equally to foreigners as well as residents. Neither citizenship, nor residency, or even a
presence in the country is required for land ownership.

Land Records

Costa Rica boasts a safe form of title registration to protect buyers from hidden claims. In many
ways, the Costa Rican system of maintaining property records is far superior to systems in use
by more developed countries such as the United States. All documents are centered in the
National Registry, where both titles and surveys are recorded. Records are kept in a central
computer system as well as on microfilm, and in original form. Duplicates of all records are
updated daily, and sent to two separate fireproof vaults in separate locations from the registry.
Any change in the status of a title, or any claim that might affect it, must also be noted on the title registry page, thus making it easy to verify.

Those who purchase land in Costa Rica should get professional advise, which includes a search
of the title in the Registry, so as to confirm there are no liens or encumbrances on it, and to
establish its proper ownership. Once the deal is completed, the purchaser should receive
documents to prove the sale was registered in the Registry.

Purchase Contracts

Costa Rica’s legal system is based on a “civil code” system, as opposed to a “common law”
system like that of the United States. Under Costa Rica’s civil code, there is less interpretation of
the law by judges, because the civil code is more restrictive. For this reason, land contracts in
Costa Rica are far lass comprehensive, than the common law contacts most foreigners are used
to. Under the civil code system, the contact covers only what is not regulated by law, and thus
can be very simple.

In Costa Rica a land purchase contract is achieved through an “option to purchase”. An option to
purchase gives the buyer the right to purchase a described property in a set amount of time.
Typically 10-20% of the purchase price is paid to the seller through a broker or attorney (after
verifying the property can be legally transferred), for the purchase of the option. Most closings
can take place in a matter of days if the property is already registered in the National Registry;
however, most options are written for 30-90 days.

Beachfront Regulations

The most desirable and expensive land in Costa Rica is beachfront. The majority of coastal
resorts are located on the beach in what is known as the “maritime zone” or “zona maritima”. The
maritime zone is a 200 meter wide strip of land running parallel to the coast, starting at the high
tide line. This 200 meter strip is divided into a 50 meter strip closest to the shore (“inalienable
zone”) where no development can take place, and the remaining 150 meters, which can be leased
from the local municipality, and developed after the filing of a regulatory plan with the
government.

Most vacant beachfront land does not have a regulatory plan filed, as this is usually done just
prior to development of the property. The regulatory plan is the most time consuming and costly
phase of obtaining the land lease, known as a “concession”, and is best accomplished through
professionals. With proper planning, a concession can be obtained during the time that the
proposed development is in its planning stages. For those interested in developing land within the
maritime zone, professional assistance is a must.