Investing In Costa Rica Real Estate
A beautiful country with plenty of natural resources and undeniable temptations, Costa Rica is an upcoming real estate hub. Surrounded by palm fringed beaches, a rich variety of flora and fauna, dense undergrowth of rainforests, magnificent mountains and numerous species of wild animals, Costa Rica is a paradise on earth. This is the real Costa Rica and it attracts thousands of tourists every year. But now it has started to attract a different group of people – real estate investors. Suddenly it has become a haven for real estate investment especially for American, Canadian and the European investors. The Costa Rica real estate market has entered a new phase with the arrival of foreign investors.
If you are looking for Costa Rica investing in real estate property then you will get to choose from different types of homes in different climatic zones and environment. In Costa Rica, a real estate property can be transferred from a seller to a buyer by using a property transfer deed or the escritura. The transfer of the deed needs to take place before the Notary Public. The Notary is extremely effective in Costa Rica and has certain powers apart from authenticating signatures. The Notary has powers to act on behalf of the state and is normally an Attorney who can draft legal documents, authenticate signatures and certify the documents.
A real estate property deal can be carried forward in Costa Rica only after the buyer and the seller have selected an Attorney to draft their transfer deed and the deal will be closed once it is registered as a sale in the centralized property registration office called the Registro Nacional. Any property deed that is executed in any of the provinces of Costa Rica has to be filed at the office of the Public Registry.
Why Should You Invest in Costa Rica
There is more than one reason for investing in Costa Rica real estate and here are some of them:
1) Costa Rica has more than 51,200 square kms of beautiful and virgin landscape with a lush green surrounding environment that makes it the ideal location for Costa Rica retirement homes
2) A traveler’s paradise, it has 1500kms of tropical and sun kissed sandy beaches harboring the sparkling and clear waters of the Caribbean and Pacific Ocean
3) Costa Rica cost of living is lower than most of the developed countries like Canada, North America, France, England and many others
4) The maintenance cost of real estate is quite low and this is one of the key factors for buying a home in Costa Rica
5) The price of land and house is quite affordable even in the affluent areas of Costa Rica and is lower in the suburbs. As compared to the US, the prices are 20-25% lower
6) The real estate resale market in Costa Rica is quite strong
7) Costa Rica has one of the most stable economies in South America
8) Costa Rica has a strong educational system and hence there are more teachers than cops!
9) The low taxation regime offers a pro real estate investment environment
10) Costa Rica has 7 micro climates from tropical forest to sand soaked beaches
11) Excellent infrastructure and communications with high standards of service
12) Costa Rica has a strong infrastructure with abundant supply of electricity and water
13) Due to strong infrastructures and stable economy, most Costa Rica cities have transformed into cosmopolitan hubs
If you are thinking about buying a beach house then the it is important to remember that most beach front properties here are untitled property since the ownership of the shoreline is governed by the Maritime Zone Law or the Ley Sobre la Zona Maritimo Terrestre. According to the Costa Rica Maritime Zone law, the first 200m of any beach front is owned by the government. The Maritime Zone Law also has restrictions against foreign ownership or possession of any beach front property. Hence, if you are looking for a beach front Costa Rica real estate then you need to reconsider your investment and do an in-depth research first.
In a time of rapid industrial and economic growth, Costa Rica is one of the best real estate options. Costa Rica retirement advice is that it is a country of warm people, an amazing environment, sound infrastructure and low cost of living. What more can you expect from one of the most beautiful countries in the world. Buying a home and living here is like being in paradise!
Is It Easy To Invest in Costa Rica Real Estate?
Costa Rica is a natural paradise that boasts of 7 different climate zones, thousands of habitats, various species of flora and fauna, great people, shimmering sandy beaches and a glorious sunset. Costa Rica will captivate your imagination like it was a mystical land full of promises but then that’s true. Costa Rica real estate promises more than just a home, it promises a dream!
Today Costa Rica economy is going through a boom and it shows with the development of sound infrastructures in cities and small towns. A good transport system backed by every facility of a cosmopolitan, Costa Rica is slowly emerging as a favorable real estate investment destination. But the important thing is that as a buyer or an investor you should not leap into the Costa Rica real estate market blindfolded. There are certain important aspects that you need to take care of before making an investment. Some of them are:
First and foremost: Find a Reliable Attorney
It is not an easy task but you can ask some of your friends, colleagues or family to recommend a reliable attorney. You can even approach the embassy of your country in Costa Rica for advice. You can also check with the Costa Rican-American Chamber of Commerce.
In-depth Research of the Real Estate Property
It is always a good thing to conduct a research of the property before buying or before making an investment decision. In this case, you can take some help from your attorney. Your attorney has the authority to conduct a title search with the Registro Publico or Public Registry office and find all the important details regarding the property in question. The information will prove useful especially if you are looking to buy Costa Rica retirement property.
According to the laws in Costa Rica, all real estate property has to be registered with Registro Publico. Each of these properties has a title registration number known as the Folio Real. Once your attorney gets the number, it will be easier for you to search through the expansive database. The database or real estate information is published in the Registro Publico's Report also known as the Informe Registral. The information will include the name of the title holder, mortgage available, liens, boundary lines, tax appraisal, and information of any kind of record that could affect the title.
Writing a Transfer Deed
Costa Rica offers some of the best real estate investment options. It is slowly becoming a hot real estate investment destination because the Costa Rica cost of living is lower than the US and many European countries. Many people come to Costa Rica to invest in retirement properties, which can be in the form of a villa or a condominium.
The only way you can buy Costa Rica real estate is through the transfer of ownership. This authority is mentioned in the transfer deed, which is generally drafted by the seller’s attorney. The property or real estate can be transferred only when both the buyer and the seller sign the transfer deed or escritura in the presence of notary/attorney. The sale of the property is registered with the Registro Publico. According to Costa Rica custom, if the buyer is paying in cash then he or she will have the right to choose their attorney for drafting the transfer deed. If it is financed in any way then the transfer deed can be written by any of the attorney’s i.e. the buyer’s attorney or the seller’s attorney. Both the parties have to be in agreement in such a scenario.
What Are The Closing Costs
The closing cost is an important factor of Costa Rica investing in real estate. According to the laws, the closing costs have to be shared by the buyer and the seller. You will also have to take care of the following aspects:
You will be required to take care of all applicable taxes before the property is registered. This includes a real estate transfer tax totaling to 3% of the sale price and a registration fee of 0.5% of the total sale price.
You have to also pay the Notary fee before the property can be registered. The Notary fee is normally 1.5 % of the first $5,000 and subsequently you will have to pay 1.25 % of the balance amount.
A mortgage is issued during the sale if a part of the property is being financed. The normal mortgage fee is 0.25% of the registration fee and 0.53% of the documentary stamps.
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