Investing in Costa Rica
So you have searched all the Costa Rica property for sale on the web. Read everything you could on how to invest, where to invest, what pitfalls to watch out for, and how to get a good return on your investment. Well, by now you are probably more confused than when you started. The following steps will help to simplify the process and ensure your buying experience will prove fruitful and enjoyable at the same time.
1. Narrow your search down to a particular region –
It is important to decide what area you are most interested in. The Northern Pacific has seen the most growth and development, but the prices reflect that. The Central Valley remains a steady market with good access to San Jose. The Central Pacific is a juvenile in regard to an investment opportunity, and the South Pacific still a baby.
So depending on your investment goals, whether it is a “quick flip”, an extensive development, a long-term hold, or simply a retirement place; the particular region you choose can weigh heavily towards the end result.
2. Determine your budget –
In order to best utilize the time you are going to have while property hunting in Costa Rica, you should have a ballpark idea of how much money you are willing to spend. There are so many amazing pieces of property on the market in Costa Rica, that you can get bogged down trying to see everything. Stick to your budget, which narrows your search to the properties that are most important to see.
3. Schedule your trip –
This is a big step that too many people take for granted. You should allow yourself at least 15-30 days in the country to be able to acclimate yourself and view enough properties to feel comfortable buying. Also, you have to consider the weather conditions could play a vital role in how much property viewing you are actually able to do. For example, if you planned a two-week trip in October to view property in the Southern Pacific Region, you could get rained out every day, as October is the peak of the rainy season. The primary goal here is to allow yourself adequate time so that you do not feel pressured or hurried.
4. Set up appointments –
Before leaving for your trip, take the time from the comfort of your home to set up several appointments. I would even recommend setting up more than you think necessary because there is a high possibility that either you or the agent will not be able to make the appointment. Business is very laid-back in Costa Rica and schedules are often not adhered to, so be prepared for that scenario going in. Costa Rica has a way of changing schedules, which is not always a bad thing.
5. Start the hunt –
Now the fun part begins. You have picked the area or areas you are most interested in, scheduled appointments to see properties within your budget, and you are on your way to locating that perfect piece for your needs. While searching, be sure to check the area for previous sales so you can establish an idea of what properties have been selling for. Even if you fall in love with the first place you see (which happens often here) keep on looking because it is liable to get even better. Buying property in Costa Rica is a very safe process with only two primary pieces of documentation you must ensure are present and valid. The first is the title, or escritura, this document; similar to a deed in the states guarantees ownership without liens or encumbrances. The second is a valid survey or plano, this document shows the physical boundaries of the property and often any improvements. If both of these things are in order, you are well on your way to buying. (Insider tip—talk to waiters at restaurants about the property they might know is for sale. Nearly all will know of something, and often you can find great deals. Just be sure to verify the aforementioned documentation if you get that far along)
6. Make an offer –
This part can be a little tricky in Costa Rica as there is no rhyme or reason to what is an acceptable offer. Most developments are fairly set at the prices they are asking for their land, but sometimes early in you can catch a development in need of cash flow and get a great deal. When buying off a local, or Tico as they are known, I have seen offers as low as 50% accepted and other locals who were tremendously insulted by anything other than the asking price. You really have to get a feel for who you are dealing with to make the right offer.
7. Close the Deal –
This process is very similar to the one we have here in the states. Both parties can choose a separate lawyer or decide to use the same lawyer, which is often more cost-effective. If you desire, you can choose an attorney that speaks fluent English so he can explain the entire process to you. These attorneys are generally more expensive, but the peace of mind is often worth the cost. Your attorney will do a title search and verify the survey in a manner that is equivalent to the process here. Most people choose to form a Costa Rican corporation to buy the property, which helps to limit certain aspects of liability. Once everyone has signed and the funds are transferred, you are now the proud owner of your own piece of paradise. All property is then registered in the National Registry which is accessible online to check ownership status.
People are often intimated by the myths they hear in regard to purchasing a property in foreign countries. The truth is, from personal experience, by simply following these easy steps you can ensure your experience will be a profitable and pleasant one.