Costa Rica real estate is hotter than ever, and the world seems to be flooding in to grab a piece of the action. Developers, realtors, web marketers, and multi-level marketers have come out of the woodwork to support and promote this rapidly growing market. Only a few short weeks ago, the people of Costa Rica voted for the Central American Free Trade agreement in a landmark decision that will undoubtedly further fuel Costa Rica based businesses, and therefore the Costa Rican economy as a whole.
Invariably with any feeding frenzy of this magnitude, come those who would prey upon unwary investors. On the whole, the vast majority of property owners in Costa Rica have experienced double digit growth on their investment year after year. Others have found themselves left holding the bag. Here I have posted five tips to assuring a safe property purchase in Costa Rica.
1) Use your own attorney to do your due diligence
Though this would seem like common sense, attorney’s often “Double end” real estate transactions in Costa Rica, creating a conflict of interest which often does not play out in favor of buyers new to Costa Rica real estate transactions. English speaking attorney’s in Costa Rica are plentiful and usually very affordable. If it is your first time buying, it would be wise to avoid using an attorney referred to you by the seller.
2) Verify the property you are buying has title
Property in Costa Rica may be held in a variety of formats, but the safest property to buy has it’s titled registered in the Property Registry in San Jose. Your attorney can do a simple internet check to verify your property’s title is registered and without liens or encumbrances. Property without title can be a great investment if you fully understand the risks that go along with it, and generally is not for first time buyers.
3) Reverify the boundaries of your property against your plot map with a certified topographer
Every property in Costa Rica has a plot map, or plano which shows where the property is located and where the boundaries are at. Having a certified topographer re-survey the property you are considering, and put monuments along the boundaries provides physical re-verification that what you are buying is what you have been shown.
4) Avoid multi-level marketing property purchases
Being introduced to your dream Costa Rica property in the comfort of your own town by means of a traveling “Wealth Building” seminar does not constitute shopping or due diligence. There are quite a few internet forums with people who have bought from such marketing organizations bewailing their woes, after they discover they paid too much or that the property they bought has problems.
5) Check with the municipality for permitted land use
No one wants to discover they cannot build their dream house on the property they bought because of zoning issues. More common are forestry and environmental issues which often make certain parts of a property “off-limits”. Have your attorney check with the municipality and verify you will be able to use the land you are considering in the way you want to.
