Investing in property overseas can be a great way to boost your investment portfolio, and one of the hottest places to invest in property right now is Costa Rica. A beautiful land with the Pacific on one side and the Caribbean on the other, Costa Rica is an amazingly peaceful country with everything an investor could dream of, including coastal and mountain based properties, forest areas, prosperous urban developments, and farms.
However, there are several things you need to know before you begin the process of buying real estate there.
One of the first items you should be aware of is the lack of finance opportunities available to foreign investors. Unlike in many other countries, Costa Rican banks only lend money to citizens. As a result, investors must look for other options. Perhaps the best, and most common, way for offshore investors to finance their purchase is through an owner-financing plan. While some banks are starting to allow other kinds of loans, interest rates are high (between 25 and 29 percent), and finding some other option is probably the best way to go.
Another thing you need to be aware of before you invest in Costa Rican property is the legality of the situation. The Costa Rican constitution guarantees that overseas investors have a right to own real estate, and some title companies will back up your property with additional guarantees, but finding an attorney who works with overseas property investors is the best way to handle the legalities of property ownership, as in Costa Rica, an attorney must not only complete the transfer of the deed itself, he or she also has to handle the title search. In Costa Rica, most properties are listed in the “Folio Real,” a computer system at the National Registry. Before you even consider making a property purchase, complete a title search as you can to do it yourself through the National Registry’s system. Such a search can offer important information including the boundaries of the property and any current liens against it. If you are considering the purchase of land in Costa Rica, be sure to ask whether the ownership or occupation rights are for sale. Ownership rights are comparable to those in other countries, but occupation rights can get a bit tricky, and an attorney is essential to sort out the processes that go with them.
One final step you should take before you invest in Costa Rican property is to enlist an agent while you are searching for the perfect property. There are several reasons you might want to use an agent. Agents can help to protect your interests and refer you to the right people, including lawyers. Moreover, they can help to get you the best deal and let you know what the regulations are regarding particular kinds of properties. Be sure to choose one who specializes in investors, and make sure you get an agent who is licensed, as licensing is not a requirement to be an agent in Costa Rica.
Investing in Costa Rican property can truly be an important financial asset to your portfolio, but knowing your way around before you decide to make a purchase is essential.