[BUYING AND SELLING REAL ESTATE IN COSTA RICA]
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KEY FACTS OF REAL ESTATE ACQUISITIONS UNDER COSTA RICAN LAW General Framework
develop specific zoning and regulatory plans that dictate building types, density, and height within their jurisdictions. In areas where municipalities have not yet established such plans, construction is governed by the Costa Rican Construction Code and regulations from the National Institute of Housing and Urban Planning. It is essential to note that specific municipal bylaws supersede broader rules, such as those outlined in the Construction Code. Title Registration Process All real estate in Costa Rica must be registered in the Real Property Registry, which meticulously records ownership details, boundaries, and any encumbrances (such as mortgages, easements, or liens). A registered land survey or map must also accompany each property. The transfer process itself must be conducted in front of a notary public, who is responsible for preparing the deed, supervising signatures, collecting transfer taxes and fees, and ultimately filing the document with the Registry. To streamline procedures, the Registry now requires electronic filings. A significant update occurred on March 24, 2025, with the implementation of a new General Regulation of the Real Property Registry (Decree 44647-MJP). This decree modernizes filing requirements, updates registry review criteria, and improves interoperability with the cadastre, aligning data handling between the cadastre and registry. Taxes on Real Property Understanding the various taxes is crucial for real estate acquisitions in Costa Rica: Annual Real Estate Tax: Municipalities impose a yearly real estate tax of 0.25% of the declared property value, payable quarterly. Property owners are legally required to update their
In Costa Rica, real estate transactions are primarily governed by the Civil Code, which establishes the rules for buying, selling, and transferring property. All such transactions must be recorded with the Real Property Registry of the National Registry. The Registry's primary purpose is to provide transparency: once a deed, mortgage, lien, or any other document is registered, it becomes public record. This crucial step allows anyone to verify a property's legal status, thereby promoting transparency, protecting buyers, and ensuring certainty in real estate transactions. Integral to this process is the Notary Public, who plays an essential role in real estate transactions. A notary is required to formalize most property transfers with a public deed, which must be signed by the parties involved and subsequently recorded. Notaries in Costa Rica are attorneys entrusted with public trust, ensuring the legality and proper execution of these transfers. Non-Resident Ownership Rights Regarding ownership, the Costa Rican Constitution robustly protects property rights. Expropriation is permitted only for public necessity and always requires fair compensation. Both foreigners and Costa Rican citizens enjoy equal property rights, with only a few specific exceptions. Consequently, natural persons and legal entities, regardless of nationality, may buy, sell, rent, mortgage, encumber, or otherwise use property in accordance with the country's land- use laws and regulations. Land Use Planning and Regulation Local governments, commonly referred to as " Municipalities ," are responsible for managing land use, collecting property taxes, and issuing permits for construction and renovations. They
ILN Real Estate Group – Buying and Selling Real Estate Series
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