Buying in Costa Rica

Buying Real Estate in Costa Rica can be a joy, or it can be a nightmare. Here is my Top Ten List of things you really should know…..

1. Beware of unscrupulous "developers" who have set up "boiler room" call centers and will sell you lot in the middle of the jungle with no infrastructure, nor any hope of there ever being any infrastructure. Bottom line, never, put money down on property you haven't actually seen!

2. Beware of unscrupulous real estate agents that will pressure you to buy now, or will mark properties up beyond the asking price of the owner to enhance their cut of the deal. Costa Rica has no real estate brokering regulatory system. Anyone can be a broker. Best to get one that has at least taken the real estate course offered by the Costa Rican Chamber of Realtors and has a good tract record. Get references.

3. You need to be familiar with the Maritime Law. In short, it is difficult to own beachfront property in Costa Rica. The first 50 meters from the high tide mark is public domain and the next 150 meters can only be leased through a concession granted by the local municipality. Beware of any realtor or owner offering titled beachfront property as it is very rare.

4. Always check the National Registry for ownership, liens, mortgages and other encumbrances prior to making a move to buy a property. The system is computerized (though in Spanish) and you can have a lawyer check the property out for a minimal fee.

5. Make sure you are dealing with the true owner of the property. Again a search of the National Registry will reveal that fact.

6. If buying in Guanacaste (or anywhere out in the "boonies") make sure that the property has access to adequate and potable water.

7. If buying an improved property, just like back home, it pays to get a thorough inspection and yes, there are very qualified inspectors that can be hired for a reasonable amount.

8. Best to retain a reputable attorney at the outset to help with registry searches, setting up a corporation to retain title, escrow services, etc.

9. Much has been said of "tico" versus "gringo" prices. I am of the opinion that the local market is efficient enough nowadays that this sort of thing doesn't exist to the extent it once did. It makes no economic sense for a tico owner to sell to a fellow tico far cheaper than to a gringo when both opportunities exist. So I really do not believe it is necessary to have a local do your negotiating for any reason other than the language issue - and for that a good realtor with a working knowledge of Spanish will suffice.

10. Property valuation is more of an art than a science in Costa Rica. There is no multiple listing service to speak of so no really good source of value information such as comparables exists. You just have to roll up your sleeves and do some investigatory work to determine if you the owner is asking a fair price. A good realtor that knows the area can help as well, but do your own homework as well.

There are certainly other things you need to know and stay tuned to Strictly Business Costa Rica for frequent posts about investing in Costa Rica.

Links to Useful Investing Resources

Costa Rican National Registry
Costa Rica Law
Costa Rica Maps
We Love Costa Rica (Informative Site)
Amcham (Costa Rican - American Chamber of Commerce)
Live in Costa Rica (Author, Christopher Howard's Site)
U.S. Embassy
U.S. State Department Information
CIA World Factbook
Spanish Dictionary
Spanish Verb Conjugator
La Nación (local Spanish Newspaper)
Tico Times (local English Newspaper)
AM CostaRica (online English Newspaper)
Metric Conversion Site
Association of Residents of Costa Rica
Tiquicia - Package Costa Rica Blog
365 Reason I Love Costa Rica - Scott Bowers' Blog
Costa Rica Guy - Scott Bowers' Consulting Site
Package Costa Rica (Travel Site)
The Costa Rica Zine (Package Costa Rica Newsletter)
Costa Rica DVD
Costa Rica Squidoo Lenses