Making a property purchase can be an emotional event in one’s life, we work to make the buying, or selling, process as stress free as possible for you. Here’s a quick overview of the buying process.
When buying a property, anywhere, there are steps that are advisable to follow. Starting off one of the most important steps is to define the area you like.
- Once you’ve figured that out contact a reputable Realtor that works the area you’ve chosen, give him/her as much information you can about your parameters, along with your budget, and try to be as open, realistic and detailed you can. This will help your Realtor to get started in the right direction and provide you with the best options for you in that area. We here at ABC Real Estate work with a vast data base of properties that include properties up and down the coast around Tamarindo that is fed with our listings and those of Real Estate companies all throughout the region. This is a fantastic tool we use to provide our clients with complete and thorough information of what properties may suit you the best.
- Once you’ve completed the property tour and hopefully found the right Home, Condominium, or Land for you your Realtor will assist you on an appropriate amount to offer. He/she will then write up an offer that will include the buyers, sellers and property information along with a timetable for the deposit, Due Diligence (DD) and closing date. We advise to use a 3rd party escrow company (buyer/seller agreed upon company) to hold the initial deposit, manage the total purchase funds and make the final distributions of such funds.
- Once there is an agreement signed by both buyer and seller this document is sent to the respective attorneys (we work with various honest and thorough attorneys, we can recommend one for you). We now enter into the DD period where the buyers attorney performs various tasks like; contacting the agreed escrow company and have them set up the account, doing a register study to make sure that the seller is truly the owner, check if there are any sort of leans on the property, etc. When the attorney concludes the DD he will inform you of the results, and assuming all is good you then give the go-ahead to proceed. At this point the initial deposit turns nonrefundable, the deposit will be applied to the total amount for the closing.
- You can be present at the closing or you can give a limited power of attorney to your attorney so he/she can close for you. Your attorney then proceeds with making the transfer of ownership in the Costa Rica registry (registro national).
Congratulations! You now own the property, but your responsibilities don’t stop there. After maybe some cocktails and celebrations you now need to think of managing the Home or Condo, and if it’s bare land, the building process. There are multiple property managers in the area that can do from the most basic tasks for you to completely taking care of renting it, cleaning, paying bills, maintenance, etc. We also can help you find the right contractor and architect for you to build your dream home.
Even if you have your property manager take care of pretty much everything always keep in mind to check with them that these taxes are paid:
- If your property is in a corporation (S.A.) there is a yearly corporate tax that must be paid during every January to insure the functionality of the corporation. Property taxes throughout Costa Rica are very low when compared to the United States, Canada, or Europe. They are 0.25% of the registered value of the property.
- For a concession property, this tax (canon) is administered at the municipal level and varies throughout the country. The type of property, location, and other factors contribute to the calculation of this tax.
- Finally the luxury tax, if your home is valued at ₡117 million (about $210,000) or higher, you will be subject to this “luxury home tax.” This tax operates on a sliding scale, requiring properties to pay between 0.25 and 0.55 % extra depending on the value of your home. The maximum 0.55 percent is for houses valued at just under $3 million. You can at least rest assured that the proceeds of this tax go to a good cause, low-income housing.
I hope I didn’t lose you with these tax details. So, with all this done and taken care of you now can delight in your new property with tranquility. Now some exciting research starts, the kind of research that will help you take full advantage of the immense list of fun and healthy adventures to be concurred throughout this beautiful country. Enjoy!
Credits to: Mark Venegas