If you are one of the few individuals that speak Spanish, understand the ever changing market, understand the purchasing laws and know how to navigate through Costa Rica’s nameless streets, than you could be the exception to my article.
Before I moved to Costa Rica, I thought that going alone was the best way to purchase real estate in this country. I was a Realtor in Florida, had family in Costa Rica, and spoke the language, so I thought I would have no problems going it alone.
My first and second real estate quest took me from Playas del Coco in Guanacaste all the way south to Manuel Antonio. After going through for sale by owners twice and seeing both deals fall through due to title issues, I decided that I would not go it alone next time.
I came back for my third (and had hoped my last) real estate trip to Costa Rica. This time, I used a real estate agent in the area who had showed me some great homes and lots. These were properties that I would never have seen otherwise, since most of what I was shown was not advertised.
I ended up purchasing two properties with help of our agent settling on an ocean view lot and home and was happy that this time around the title was clean, utilities were in place and the purchase of Costa Rica real estate went smoothly. In the end, it paid to use an agent!
With the internet, there is such a wealth of information available at your fingertips. Unfortunately, there is a lot of misinformation as well.
I can’t tell you how irritating it is to me to read things that are not true or things that are over exaggerated. I also don’t like when people don’t tell the ‘whole truth’.
Costa Rica is wonderful.., but it’s no Shangri-La and you have to make sure that you are protecting your interests.
While there are many great, knowledgeable, honest real estate agents, there are also many that don’t have a clue about what they are doing. There are also many great developers and developments in Costa Rica, as well as some that I consider to be substandard.
Buying real estate in Costa Rica can be a great investment, but you do have to buy smart. Due diligence is a must and knowing what to look for and what to ask is even more important. Having a good Realtor, who is honest, is just as important is just as important to having a trusted attorney.
Costa Rica Real Estate Quick Tips.
- Don’t buy something sight unseen. You probably wouldn’t do this in your home country, so why do it in a foreign country?
- Don’t feel compelled to send money down to secure property before your arrival. I’ve always said, if a company has to entice you to come down by requiring a large deposit before your arrival, there is something not quite right. The only exception is if you are dealing with a known, trusted individual on the other side and you are positive that if you don’t like what you see once you do arrive, you can get your money back in a timely manner.
- Don’t believe everything you read in chat forums or websites. Remember that everyone is entitled to their own opinion. The best people to ask about a particular area of Costa Rica are those who live there full time.
- It’s a good idea to form a Costa Rican corporation to buy real estate for tax and liability purposes.
Realtors in Costa Rica
- “Realtors” are only are those who are members of the National Association of Realtors. There are probably around 10 actual Realtors in Costa Rica last I heard and I am one of them.
- Anyone can call themselves a Real Estate Sales Agent in Costa Rica. That’s right! Since there are no licensing requirements for agents in Costa Rica, your taxi driver can claim to be an agent!
- Not all agents are created equal! Don’t be afraid to ask your agent questions. Google their name, do a background search. I’ve had clients do Google searches on me. I even had one client who did a background search on me. Some might be offended by people doing background searches on you, but I was flattered. I have nothing to hide. Plus, if everyone did a background search and asked for references, there would be a lot less fraud in real estate.
- There is still no comprehensive MLS (multiple listing service) in Costa Rica. You may have come across some web sites that claim to have an MLS system. The truth is that there is no true MLS. Some real estate offices have their own version of an MLS, but it is definitely not a complete list of all properties in all of Costa Rica. Don’t be fooled!
- While it’s good to have a competent Realtor, it is just as important to have a competent attorney who can help guide you through the legal system of Costa Rica.
Questions To Ask Your Costa Rica Realtor.
- How long have they been to the country? Are you legal to be here?
- What kind of sales have they had?
- Are they a Realtor in their home country, are they a member of any real estate agent groups in Costa Rica? (Remember that Costa Rica does not require licensing for Real Estate agents)
- Can they provide you with at least a handful of good, verifiable, references of past clients?
- Are they working exclusively as your buyer or seller agent and not both? (In the states this can be a conflict of interest).
- Does your agent work with other real estate agencies in the area?
- Is your agent familiar with basic real estate laws in Costa Rica and can they explain the purchasing process?
- Can your agent refer you to a reputable attorney who is bilingual?
- Since there is no MLS in Costa Rica, how do you keep your inventory list up to date?
Buying Land in Costa Rica
- Make sure there is water and electric to the site. Make sure that the water is a registered, legal well (very important) if well is your water source.
- Make sure you ask for a copy of the survey from the current lot owner. If in a community, you can also get a community survey map. You have a right to re-survey the lot should you choose to.
- If you are buying in a community, find out the zoning and if the community is in a Horizontal condominium, review the Regulations for the community, building restrictions (if any) and costs for monthly fees.
- Find out who is responsible for access roads within the community (may be developer or home owners).
- Find out about phone access and internet access (if available).
- Does the property require septic or is there sewage treatment on site?
- Verify drainage and where your water runs too.
- Your attorney should verify marketable title and make sure that property taxes are up to date. If taxes are unpaid, the seller is responsible for payment at closing.
- If buying an oceanfront lot or a lot within the Maritime Zone, make sure to have your attorney verifies the concession.
Buying A Pre-Construction Condo or Home in Costa Rica.
- Verify water supply and utilities on project site. If project is on a well(s), verify that they are legal.
- Verify the background of the developer, builder, engineers behind the project. The more you know about the ‘team’ behind the development, the better off you are.
- If you are putting down a deposit for a ‘reservation’, make sure it’s completely refundable until you go into contract.
- When in contract, most developers require ‘draw’ payments based on point of construction. Each developer is different, so make sure to verify the draw schedule and penalties, if any.
- Make sure what you are being offered (finishings in unit, appliance package, name brands, etc) are part of your contract.
- Make sure to find out what your proposed HOA (Home owners association) dues will be per month.
- Is phone and internet available?
- Does the condo project have a water reserve tank?
- Make sure your money is being held in escrow until you close. Try not to send money directly to the developer although it is standard for some companies!
- Ask for a copy of site plan, survey, well location, etc.
This is a pretty complete list for you, the buyer, to be educated in a purchase decision. You owe it to yourself to be educated, especially in a foreign country. Don’t be afraid to rely on a qualified real estate agent to guide you in the right direction in paradise.
Do I Really Need a Realtor In Costa Rica?
Article/Property ID Number 1512
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