Advices About Costa Rica And Real Estate
Where is Costa Rica?
It is located in Central America, approximately a 2 hour flight from Southeastern United States.
What’s the weather like?
In most parts of the country, there is a dry season that goes form mid December to May and a rainy season that covers the rest of the year. The variation in temperature from the rainy season to the dry season is not dramatic, being of approximately 5 degrees Celsius. In the Central Valley the average temperature is of 24 degrees, and in the coasts (such as Jaco Beach) it is approximately 30 degrees.
Why should I invest in Costa Rica?
Costa Rican economy is very stable, progressive and booming, with equitable laws that are foreigner friendly. Besides, Costa Rica has the oldest and strongest democracy of all the region; has a very strong middle class which prevents social conflicts; and has a long history of peace, consolidated with the abolition of its army more than 50 years ago. The last 20 years yielded changes in government policies toward foreign investments and overall economic growth. Because of its climate, natural beauty and the fact that it is close to the United States, Costa Rica has become one of the favorite places for people from all over the world, but mainly from the United States who wish to buy second homes or relocate outside of their country.
This high demand for real estate is one of the reasons why in the last years, in the best areas of the country the prices have increased in more than a 30% per year. But even after this rise in the price of land, there are still great opportunities and there are regions that haven’t experienced this accelerated rise in the price of properties but will surely do in the 
short and medium term. Even though Costa Rica has become a hot market in the last year, the prices of land in this country are still lower that other hot markets of the world with similar characteristics to Costa Rica. Investment in Costa Rica is also benefited by a large very well educated work force. This is a country with one of the highest literacy rates in the world. There are excellent medical services at very reasonable prices. Has a good economic condition and the exports have been growing, in areas such as medical devices, microchips, agriculture (pineapple, melon), biotechnologies and also there has been strong foreing investment and a lot of call centers have been established in the country
What to do first if I found a property I would like to buy?
Having selected your ideal property in Costa Rica, you will want to be absolutely certain of the legal aspects of the purchasing process, and particularly your rights in a foreign country. When you have decided on a certain property the first step is to deposit a small amount in order to take the property off the market and reserve it until the remaining steps have been completed. The most common procedure is to establish a earnest money deposit agreement together with a down payment. This is usually 10% of the purchase price. Within this agreement you accept the terms and conditions to purchase the property.
What is important to know about buying property in Costa Rica?
Ask to see an official Costa Rican Registry Survey of the property. If one has not been completed, which can be common when purchasing a section of a larger parcel, request that any deposit be held by an escrow agent until an official survey has been provided. If this is the case, ask to review the official Registry Survey of the initial parcel.
Do I need to use an attorney?
Always be sure to meet with an attorney who can speak your language and answer your questions. In Costa Rica buying real estate, segregation of lots, constitution of mortgages, cancellation of mortgages or any kind of movement of land requires that the parties appear before a Notary Public of the Country, who in Costa Rica necessarily has to be a lawyer. The Notary Public in Costa Rica issues a public document or testimony which contains the intent of the parties, which is transcribed directly in the Notarial record book. Then the document has to be presented or annotated in the Public Registry for its registry, paying for this effect the tax stamps, transfer taxes (if applicable) and legal fees before purchasing the real estate.
The average time to register a document, which does not present any objections from the registry, is approximately one month. Once the document is registered, the Public Registry shows the new inscription for the benefit of the parties involved and any future relevance for third parties. Before entering into any contract involving land, it is very important to study the actual statement of the property which is being negotiated. These studies are carried normally by the same Notary Public, which can obtain a resume of the property through the Public Registry. From this point, the parties can determine if it is convenient to continue with the deal, taking into consideration any limitations and conditions that might affect the property.
How is title transferred?
When buying property in Costa Rica, the title is transferred from seller to buyer by executing a transfer deed before a Notary Public. Unlike common law countries, such as the United States and Canada, where the role of the notary is limited to authenticating signatures, in Costa Rica the Notary Public has extensive power to act on behalf of the state giving faith about the intent stated by the parties, as well as of several other facts and circumstances related to the parties and to the property. The Notary Public must be an attorney and she or he may draft and interpret legal documents, as well as authenticate and certify the authenticity of documents.
Can I get financing in Costa Rica?
Financing through a bank is still kind of complicated since it is difficult for the Costa Rican banks to get financial information of foreign debtors. The interest rate is between 8.5% and 12% in a US$ loan, and the maximum term is 10 years for commercial properties and 20 years for residential properties. Most of the deals in Real Estate are cash deals or financed by the owner or seller, usually very short term with high down payments (like 30%-50%). Sometimes the buyer can get better rates and faster approval (or easier approval) using a first or second mortgage in their home country on property they have there, then the cash can be used for buying property in Costa Rica.