Terrestrial Zone (“ZMT”) refers to the state-owned, 200 meter strip of land along the shore — measured from the “average high tide” — administered by the local Municipality and the ICT. The Maritime Zone Law was established in 1977. It describes the ZMT as having two parts. The first 50 meters is the “public zone” and cannot be built upon or claimed. The next 150 meters is the “restricted zone.” This area can be legally acquired by private citizens by applying for the rights before the Municipality through a “concession application.” Submission of this application gives you the right of occupation, called Permiso de Uso. This is an “interim right” of ownership, good until proper zoning and concessions come through down the road. You now have the right to occupy the land and build a temporary structure. But note that each Muni applies these rules differently. In the past many pre-concession ZMT occupants have paid a yearly “occupation tax” to the Munis in an effort to bolster their claims. But under the law, such “canones” are not due until after the concessions have been duly issued. Legally registered applicants should also renew their application with the Muni without fail every six months or risk losing their entire claim to the property (Article 33). If along the way they decide to sell, they can transfer their rights by way of a Cesión de Derechos. This allows the registered occupant to transfer all his or her rights to another person. The next step towards getting the concession is for the shoreline to qualify for a new zoning scheme, called the Plan Regulador. The Plan is implemented through a costly ($30k and up) and complex zoning proposal. This takes a couple of years to get approved. Typically neighbors collaborate on these. That’s because at least until recently you needed one kilometer of beachfront to do your own (but now apparently private plans are no longer being allowed and the Munis are being told to do the Plans themselves, as they are required to by law). The process requires getting the ICT, INVU and the Municipality to sign off on the plans.

Once approved, legal occupants inside the newly zoned area can “activate” their Solicitud de Concesión and transform their Permiso de Uso into a Concesión. This is a more permanent and specific form of ownership that can be inscribed in the National Registry. Concessions are as close to a title as you can get for beachfront even though the land technically is still owned by the state. They are typically issued for terms of 5-20 years, and are automatically renewable, assuming applicable laws and regulations have been respected.

Even though certain areas have seen substantial development in the ZMT, over 90% of the coast in CR still lacks approved zoning or concessions. It follows that over 90% of the development inside the ZMT country-wide is illegal. That’s because any development at all is prohibited without the proper ZMT zoning under a duly approved Plan Regulador. In fact, the majority of occupants of the ZMT in CR today probably don’t even have valid first-in-line applications for concessions on file and up to date with their respective Munis. If you are one of these folks, this means that your rights could be at risk. That’s because the ZMT law doesn’t care what you may have paid for the land. Neither does the law care how long you may have lived there, since tecnically no one can ever acquire any legal rights to the ZMT merely by possessing it over time. What the law does care about is very narrow and specific: who is first in line with a valid and current application for concession? First in line, first in rights. To the winner go the spoils. We know of some nearby beaches where five or more “owners” of the same parcel are all vying to sell the same dubious “right.” Pity the poor buyer who falls into their clutches while looking for a little peace and quiet on the beach. Costa Ricans or foreigners having five years of residency can register beach property in their own name. Costa Ricans or foreigners having 5 years of residency can register beach property in their own name. Foreign citizens must register the rights to their beach parcel through a Costa Rican corporation formed by an attorney. The corporation must have at least fifty percent of its shares held by a Costa Rican resident. This sounds weird, but can be set up safely in our experience.

In sum, a word of advice from us at Land Assurance: when considering beachfront, be very, very careful. If it comes with a valid concession, then that is as safe as it gets. Just be sure it is zoned for your intended use. But without the all-important concession in hand, it’s inherently risky. Then the name of the game is, caveat emptor times ten!

Buying Property Safely in Costa Rica

Sometimes one hears that “buying titled land in Costa Rica is very different from the way it works ‘back home.” Wrong answer! Assuming of course that home is the US, Europe, or Canada. Such a statement probably means that the person dispensing the advice is, at best, not a real estate professional, or, at worst, may have ulterior motives. That’s because the truth is that the process of buying real estate here should very closely mirror the way it happens “back home.” Of course, the languages will vary, as well as the letter of the local laws. But what really matters is that the legal principles associated with a safe purchase—and the procedures designed to protect them — are indeed very similar.

Before we turn to the legal principles, hovering over them all is the requirement of
transparency. This is the key to any reputable deal. Everything good, bad or indifferent about the property should be disclosed by the sellers and their agent, if such items are relevant to the intended use or not. Also, there should be no hidden fees; everybody who gets paid at the closing should have his or her cards on the table, with the amounts they are charging agreed to in writing ahead of time. The commissions that will go to certain parties must also be spelled out in advance. An example of a clear violation of the transparency rule is the practice of overpricing, also called net listing. The broker lists a property for a higher price than the true selling price, and tries to pocket the difference at the closing without the buyer ever realizing it. This is all-too common in Costa Rica. However, a broker is only entitled to the standard, agreed-upon commission. This is usually 10% for raw land and can fall to as low as 5-6% for large deals or centrally located houses. But more important than the exact figure is that all the parties agree in advance to the nature and type of fees. The critical legal principles and procedures include the following:

1st Principle: The land you are shown must correspond to the legal description on the title page in the Public Registry, as well as to the plat map which is inscribed in the “Catastro Nacinal” ( plat map registration bureau). With a small lot, this is pretty straightforward, but for large properties, it’s hard to be sure that you are getting what you were shown. Procedure: After walking the borders, and inspecting the title and plat map to be sure they correspond to each other and to what you were shown and told; you must hire a topographer to verify the borders, before (not after) you buy. If there is a discrepancy, it should be worked out prior to the closing. If your new survey is materially different from the old one, you should re-register your new survey over the old one, again, before the closing.

2nd Principle: When an offer to buy is accepted here in Costa Rica, just as in the US, the terms should be duly written up in a signed purchase agreement, and earnest money placed in escrow. At that point, the owner has a duty to sell to no one else and to honor the established price at the closing. Procedure: You get a written contract in the lawyer’s “protocolo” attesting to the terms of the offer your lawyer records this option in the National Registry, under the title page. That way, nobody can buy the property out from under you during the contract period without facing a loss in court. That’s because the buyer would not qualify as a third party good faith purchaser, thanks to the notice in the Registry of a pending sale.

3rd Principle: Ownership of real property is called fee simple absolute under US common law. The concept is the same here, although the name may be different. Procedure: The title to the property should already have been recorded in the National Registry, so that when you buy it, the ownership is transferred to your name or the name of your corporation (see sample registered plat map or plano catastrado in the adjacent column). Now nobody can try to claim it without due process, just as we are used to “back home.”

4th Principle: You must actively protect and/or use your land or you risk losing it to third parties (squatters). In Costa Rica this applies only to rural land, not houses or land in towns or cities. The US has similar laws, known as “adverse prescription.” Procedure: Putting up and maintaining fences and signs, having the property checked or patrolled on a regular basis, keeping the weeds down, and performing other signs of active ownership are all you need to protect you property from squatters; moreover, in the last five years or so, squatters have begun to lose consistently in litigation, as the courts increasingly recognize that valuable ocean view land should not be taken from a careless owner just so that someone can grow beans on it. Rural real estate throughout Costa Rica is often untitled. The land may have been settled, farmed and perhaps sold several times in the past with nothing more formal than a bill of sale (carta de venta). This is not necessarily an obstacle to purchase since the title may be acquired after purchase through a legal process known as Information Posesoria (Law Nº139 of July 14, 1941). Minimum requirements to qualify for a registered title to possession land are a registered survey and documentation of peaceful, public and undisputed possession of the land for a period of at least 10 years. This procedure involves verifying the history of the real estate, its boundaries and the declarations of owners of adjacent land. Private documentation such as bills of sale recording the history of ownership is very useful for this process. To accomplish title to possession land, a lawyer should guide the paperwork k through t he appropriate court, usually the agrarian court. He will present letters from all pertinent governmental agencies certifying that the property does not fall within the boundaries of National Parks, Indigenous Reserves, or other protected areas, and notarized statements from adjacent property owners attesting that the landholder is in fact in possession of the land and that they agree to the specified boundaries. A judge’s inspection of the land and review of all documentation are also part of the title process. It is a bureaucratic procedure that may take from six months to a year (possibly more) to Complete; however, untitled land is usually less expensive than registered property so the time factor may not be of concern to some buyers. In some cases, the title process s even stated as a condition of the sale or escrow.

Costa Rica is a Central American tourist destination which is famous for its scenic locales such as beaches, mountains, rivers and forest area that is full of lush greenery. It is generally known that the main income of this region is from the tourism industry, which helps in generating more than $ 1.7 billion per year. Apart from this, Costa Rica has had pharmaceuticals, electronics, outsourcing and IT industries build operations there, including Intel and Proctor & Gamble.  The fact that these blue chip companies selected Costa Rica speaks volumes about its peaceful tradition of democracy and                non-aggression. Costa Rica’s lands and beaches are ideal for eco-tourism and reforestation, both of which present huge opportunities for investment purposes since the government promotes them.  Foreigners who start eco-tourism or reforestation projects receive “fast track” approval for official residency, as well as other benefits.  Due to the natural beauty of Costa Rica, most of its citizens support such green initiatives enthusiastically. 

Given the huge business and commercial opportunities in Costa Rica, it is becoming an investor’s paradise.  And the secret is out. Costa Rica came out very favorably in the Economist’s 2007 “global business risk of investing” survey.  Its rank was 33^rd in the world, not that far behind the US at 23^rd.  Costa Rica was deemed a safer business environment than any other nation south of the US, except Chile (which even beat the US).  Only 32 nations were deemed less risky for business, almost all of them in Western Europe.

In terms of land trade, the economy of Costa Rica is full of possibility as far as the hotel and tourism industry are concerned. In this regard, Land Assurance is a premium name in land deals that trades in Costa Rican Properties and Costa Rica Real Estate business. Costa Rican Properties for Sale have opened the flow of foreign direct investment and Land Assurance provides full guidance and tips in locating premium land for home, corporate, business and tourism solutions.

For more information regarding the Costa Rican Properties for Sale, log on to www.landassurance.com. You will get all the useful information online regarding the Property Costa Rica and its hassle free acquisition in full legal procedures. Land Assurance is the one stop destination for land deals in Costa Rica.

The Republic of Costa Rica is an amazing place to live in. The country is experiencing major development under the presidency of Nobel Peace Prize winner Oscar Arias.
Costa Rica stands out among the Latin countries, including even Chile, Mexico and Brazil.  According to most sources, Costa Rica has the premier reputation for safety and democracy in the region.  For example, in the global rankings of democracies recently published by the Economist, only 28 nations were considered full democracies.  And of all the nations in Latin America and the Caribbean, only Costa Rica made the list (and Uruguay, which was last).  Even Chile was deemed a “flawed democracy.”  And the “ticos,” as the citizens call themselves with pride,  recently justified the honor by approving CAFTA in a national referendum. 

In addition, Costa Rica did very well in the Economist’s 2007 “business risk of investing” survey.  It came in at 33^rd in the world, out of  over 200 — and not that far behind the US at 23^rd!  Costa Rica was deemed a safer business environment than any other nation south of the US, except Chile (which even beat the US).  So everyone expects the pace of foreign investment here to quicken.  After all, the market is looking for three things: safety (physical and legal), beauty, and proximity.  With those three in place, infrastructure will follow.  If Costa Rica continues to move politically more towards places like Switzerland and Canada, and away from the Nicaragua and Guatemalan model, it’s current boom may well become a permanent prosperity.

Costa Rica is widely known for its scenic beauty.  But that is only part of the story.  After all, Colombia and Guatemala are even more beautiful.  What stands out about the ticos is their extremely hospitable and friendly disposition.  National politics is built on respect and conciliation, and a deep sense of duty towards the poor.   In Costa Rica, medical care is free to all, unlike any other Latin nation and even the US.  In addition, every poor Costa Rican is elgible for a free plot of land and the funds to build a small house, courtesy of the government.   The poverty rate is about 19%, about half of neighboring (and wealthier) Panama’s, and ¼ of Nicaragua’s.  But rather than being swept under the rug, this issue is widely discussed by all the major parties, with many plans being proposed to help the poor improve their status.

The countryside, and the cities and towns besides the capital of San Jose, are tranquil and safe to visit or live in.  Foreigners, if they behave well and show respect, are welcome.

Buying real estate in Costa Rica is made extremely easy by landassurance.com.  This US-owned company has been in business for over ten years.  Located in the resort town of Dominical, Land Assurance is a leading property broker along the southern Pacific Coast, where it offers Costa Rican properties for sale.  Times have changed since Land Assurance opened its doors back in 1996.  Real estate in Costa Rica with decent access and nice views, especially of the ocean, can no longer be bought at the cheap prices of ten years ago.  That’s because back then, there was minimal infrastructure in place.  But now as roads are built, gravel roads are paved, resort are developed, golf courses are created, marinas start up, and so on, prices have risen accordingly.  However, the Southern Pacific Coast, from Quepos to Panama, is still very much on the ground floor in terms of costs to buy real estate.  One need only compare its prices to Guanacaste to realize how much more expensive land and houses are going to become south of Quepos, around the towns of Matapalo, Hatillo, Dominical, Uvita, Ojochal, Palmar, and Golfito.

Prices are generally driven by location, as well as infrastructure.  Location can be defined by the scenic beauty and natural attractions of a given area.  Infrastructure includes not only the physical improvements like roads, airports, resorts, hospitals, and so on, but also the availability of financial instruments.  Only now are bank loans becoming widely available to foreigners for the purchase of real estate.  And the easier the credit, the higher prices tend to be pushed (more money competing for the same amount of land).  

The entire procedure of buying real estate in Costa Rica is simplified to a great extent by landassurance.com. The company can be easily contacted on their website www.landassurance.com

We are the most experienced and knowledgeable Costa Rica real estate company on the southern Pacific Coast.  We have been investing in Costa Rica for over 15 years, and brokering  real estate for over 10.  We work hard to get our clients the best properties at affordable prices, backed by financing as needed as well as US-style title insurance.  The only things we ask of our clients is that they treat the people here with respect, and follow the principles of sustainable land use.  We represent large eco-development projects, beachfront, luxury hotels,condos, homes, and ready-to-build lots.  Please visit us at www.landassurance.com for a look at our 250-plus current listings.