We Know: How to Buy Property in Costa Rica
What should I know before purchasing land in Costa Rica?
You may have received an email that says, "buy land in Costa Rica", but do not be too hasty. Before your purchase, get information of the requirements, costs, and dangers of buying land in Costa Rica.
What are the requirements of buying land in Costa Rica?
To purchase land in Costa Rica you need to:
- Be sure your title is checked for any liens or encumbrances.
- Reconcile the title with the plat map on file.
- Have sufficient funds to pay all necessary taxes and registration fees, including notary fees. The seller pays usually one-half and one half is paid by the purchaser.
- Provide evidence that all prior mortgages, liens and judgments have been lifted.
What do I need to know before building on land in Costa Rica?
To build on land in Costa Rica, one must be a resident for 5 years before receiving a permit to build. Several criteria must be met in order to establishing residency. They are:
- To qualify for pensionados status by proving a minimum income of $600.00 per month from a qualified pension or retirement account or from Social Security, change a minimum of $500.00 a month into the local currencies, and live in Costa Rica for at least four months out of the year.
- To quality for rentista status, by having a minimum of $1,000.00 income per month for five years, change at least $1,000.00 a month into local currency, and live in Costa Rica for at lease six months out of the year.
- Meanwhile they may not work for anyone else as only permanent residents may have work permits.
What are the costs of buying land in Costa Rica?
In spite of recent increased interest in Costa Rican Real Estate, prices still average ½ of the price of a comparable house in the United State. In addition, yearly property taxes are 1% of the assessed value.
What are the dangers of buying land in Costa Rica?
- The biggest danger of buying land in Costa Rica is that dishonest developers will likely scam gullible homebuyers with the assistance of squatters. They sell it to someone who lives outside of the country, have squatters take up residence, and buy the land back for pennies on the dollar, pay off the squatters and sell it again.
- You can lose control of your Costa Rican land if your or your salesperson tries to circumvent strict laws surrounding sale of waterfront properties.
- The Government can expropriate your land for the purposes of establishing or enlarging national parks or indigenous reserves. The government does not have a history of fair and quick reparations for the expropriated lands.
What can I do to avoid scams and problems with my Costa Rica land purchase?
- Do not buy land that you do not plan to occupy full time.
- Make sure you have met all requirements for buying land in Costa Rica.
- Do not purchase land without a reputable real estate agent and a lawyer.
- Purchase Title Guaranty Insurance.