[BUYING AND SELLING REAL ESTATE IN COSTA RICA]
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KEY FACTS OF REAL ESTATE ACQUISITIONS UNDER COSTA RICAN LAW
General Real estate law in Costa Rica is mainly governed by the principles established in the Costa Rican Civil Code for acquiring, selling, and disposing of property. The official registration of real property is made through a registry system, which the Real Property Registry of the Costa Rican National Registry administers. This system consists of a deed registration system, which provides for the public registration of legal instruments affecting land. Non-Resident Ownership Property ownership in Costa Rica is an individual right legally protected by the Constitution, which states that no person can be deprived of private property unless it is for a necessary public use, in which case it will be compensated. The Constitution grants the same rights to foreign citizens. A natural person or legal entity that has acquired property can dispose of it by selling, renting, encumbering, mortgaging, or using it for any desired purpose as long as it follows the law and the regulations for land use. All individuals or legal entities, whether Costa Rican nationals or foreigners, may purchase, sell, own, and in any way dispose of property that belongs to them. Land Use Planning Local governments, known as “ Municipalities ,” govern land use in their jurisdiction's towns, cities, and rural areas. These entities levy and collect real estate ownership taxes, and they pass bylaws and legislation to determine the use that will be allowed for private and public properties. Consequently, local governments can regulate matters such as the type of construction that can be built, its height, density, and other building requirements. They also issue building and remodeling permits, requiring that interested parties wishing to
carry out any construction comply with the established regulations, including zoning laws and/or regulatory plans. Due to a lack of funding, some municipalities have been unable to legislate on land use planning and building requirements. The Costa Rican Construction Code and the National Institute of Housing and Urban Planning regulations will govern construction in such cases. Most Municipalities with regulations on building and construction abide by the standards and regulations contained in the Costa Rican Construction Code, but specific laws, such as those passed by the Municipalities, will prevail over general legislation such as the Construction Code. Title Registration As stated above, title registration in Costa Rica is based on a Registry System. This system applies to the entire territory of Costa Rica, and therefore, all properties must be registered there. The Real Property Registry contains the registration of all real estate properties and those liens or encumbrances that affect them, such as easements, mortgage liens, encumbrances, and any other limitation on property rights. For a property to be sold, it must be duly registered in the Costa Rican Public Registry and possess a registered land map or survey that describes it. Transfers of property and the registration of all kinds of deeds relating to real property must be carried out through a Costa Rican Notary Public, who will draft the deed for the desired property transaction, which will require that all interested parties participate in granting the deed. Once the deed has been prepared, reviewed, and signed, the Notary will collect funds from the parties involved to pay all the required duties and taxes and submit it to the Real Property Registry to have it registered. The Registry has implemented several changes
ILN Real Estate Group – Buying and Selling Real Estate Series
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