Costa Rica Real Estate – This is part of our series on buying real estate in Costa Rica. We hope to provide information needed to make an informed decision about purchasing land, condos, houses or commercial property in Costa Rica. If you want more information about this property or buying real estate in general you can request the free e-book, “Secrets of Buying Real Estate in Costa Rica”
There are only a few countries all over the world which has a stable economy, have investors that are well catered to by the government and does not employ soldiers; Costa Rica is one of the limited few. In saying so, purchasing a property in Costa Rica is feasible, a very good investment and relatively easy as it is very similar to purchasing real estate in your home country.
If you are an investor or a foreign national who wants to own a property in Costa Rica and make it your permanent home it is a must that you know all the legal requirements and risks associated with purchasing real estate in this tropical paradise.
Property Search
Searching for the property you will invest in may take some time but you should never settle for less than your expectations. When you find the property that fits your needs and meets your standards your next step is to search and verify the property information at the Public Registry of Properties using folio real or the property’s unique identification number. Folio real consists of three parts: the first number signifies the province where the property is at, the following six numbers denotes the number of the property itself and the remaining numbers indicates the number of co-owners of the property. You would also be given information like boundary lines, tax appraisals, liens and encumbrances, recorded easements, mortgages and other annotations that may affect the title.
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Buying Real Estate
When you have decided on the property you will buy and you have verified the validity of the seller’s authority to sell and the property title, the next thing you have to do is ask your real estate agent or lawyer to prepare the purchase contract to present to the seller. You have the option to purchase the property under your name or a corporation name. Once all conditions on the contract is agreed on and met, your lawyer must then prepare a formal Buy- Sell / Purchase Agreement that is to be presented to a Public Notary who will record it to his or her notary book and at the Public Registry of Property. The recording process is divided into two parts; the first part is when the Public Notary submits the deed to the Public Registry for its annotation to protect the property from any third party interest, the second part is the registration of the property under the new owners name which occurs after the registry has verified that the deed is structurally correct and has met all legal requirements.
Incorporating in Costa Rica
In Costa Rica the easiest and most efficient method to purchase a property is by buying it under a corporation’s name because transferring assets through a corporation is much simpler and the corporate structure may be more flexible for transactions plus it gives you additional tax breaks.
The two common type of business structure in Costa Rica are the Sociedad Anonima and Sociedad de Responsibilidad Limitada.
An archetypal corporate company, or Sociedad Anonima in local tongue, should be incorporated by two or more individuals in the presence of a Costa Rican Notary Public. Once incorporated, the shares may already be transferred which makes it lawfully possible to have a corporation where all the shares are owned by an individual. The incorporators have to use a unique name that is not similar to any registered corporation and must have a Board of Directors comprising of the President, Treasurer and Secretary plus a Comptroller or fiscal; each of the said positions must be filled by different individual. Just remember that in Costa Rica we are using a “hybrid” corporate system wherein the incorporation deed and the company by-laws are recorded in the Public Registry and can be viewed by the public but all transfers of the company shares are recorded in the Shareholders Registry Book kept by the corporation and can only be viewed by the shareholders and officials.
A Limited Liability Corporation or Sociedad de Responsibilidad Limitada normally have numerous partners and usually have more than one manager. With this type of structure, everyone must unanimously agree to sell any stock.
The fee for setting up a corporation in Costa Rica usually runs around $500 up to more than $1000.
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Property Ownership
Types Is the Property Really for Sale?
What is the Maritime Zone?
Myths About Squatters
Construction, Architects & Engineers
Purchasing Under a Corporation
Financing
And so much more……..
