Real Estate Investement in Costa Rica
SOME REGULATIONS ON THE USE OF LAND IN COSTA RICA:
In Costa Rica there are some restrictions for the use of land, without distinction of whether the owners are Costa Rican or not, for which it is recommended to make a study of each property to know its location, ground conditions, problems related to ecology, etc., if it’s apt for the use that we desire to give it. For this we must consult with professionals in the matter such as engineers, experts, real estate agents, etc. and consult various governmental institutions depending on the location and desired use for the land such as: Ministry of Agriculture and Livestock; the National Institute of Housing and Urbanism, the Ministry of Health, the Ministry of Environment and Energy, the Ministry of Housing and Human Dwellings, the Costa Rican Institute of Agricultural Development, the corresponding municipality, etc.
Likewise, it’s important to know which zones are declared to be “reserves” (forest, aquifer, ecological…) with restrictions for ground use. For example, there are zones reserved for water where it is only permitted to construct 10% of the ground, zones for “agricultural vocation” that can’t be urbanized, others of forest reserves where construction guidelines must be respected, cutting of trees, etc.
GENERAL CONDITIONS THAT ARE REQUIRED TO PERFORM REAL ESTATE TRANSACTIONS IN COSTA RICA
IDENTIFICATION DOCUMENT:
Possess and present before a public notary a legal identification document: identity card for Costa Ricans and residence card or passport for foreigners. In the case of “legal entities” the acting people and citations from the Mercantil Registry of the same as well as tax identification.
SURVEY MAP:
Current of the property that is being dealt with.
PUBLIC REGISTRY:
There can not be pending documents for inscription at the time of appearance before a notary public.
POWERS:
If one of the parties is absent, power can be given to another person to represent before the notary. The special powers and general or very general that are granted before a public notary or in the Consul of Costa Rica, if it’s a foreigner and must be included in the protocol. Only very general powers are inscribed in the Mercantil Registry. Special powers are given with a determined purpose (the sale or purchase of estate X, for example). If the powers are granted before the Consul of Costa Rica, they must be authenticated by our Ministry of Foreign Relations.
INSCRIPTION OF PROPERTIES in Costa Rica:
99 per cent of the properties in Costa Rica are inscribed in the “Public Registry of Property”, inscription that is made by a notary public.
This dependence is completely computerized, with 80 per cent of the properties being included in the system of “Real Folio” that can be consulted from any place by means of the Internet: www.registronacional.go.cr; in this way a complete study of the property or “Registry Report”, indispensible nowadays for any transaction: sales, mortgages, rentals, liens… This report indicated for us: enrollment of Real Folio, name or names of owners, with their identification numbers; trial and date of acquisition; capacity; nature; adjacencies; location (by province, canton and district); obligations, mortgages and other encumbrances; declared value of the property (for effect of real estate taxes); number of the survey map (some times); etc. In municipalities and in the same Registry can be obtained a certification of Registry Report, giving as a reference the number enrollment of the Real Folio of the property. Some properties, very few now, are still inscribed in tomes and we must search for them personally in the Registry by tome, folio, number of estate and seat.
ENROLLMENT OF REAL FOLIO: The Real Folio is the “number of the estate” which is placed before the number of the province that is found (1 for San Jose, for example) at the end is added a hyphen as then the sub-enrollment which is three zeros for properties with only one owner and others three digits starting at one when there are two or more people with “rights” over them. For example, if the sub-enrollment is -001 -002 -003, it signifies that the estate (property) is divided into three rights that, in general, belong to three different persons, physical people or legal entities.
OBLIGATIONS: Obligation is a right that a third party possesses over the property in question. These easements can be: mobility, views, light, air, waters and many others. Nevertheless it’s important to make note of when a property has a “transferred obligation”, this could be that it has disappeared a long time ago, now that almost always it means that the obligation was generated years ago in the mother estate and all of its children (posterior segregations) appear with the same annotation, but it doesn’t affect them in reality. Nevertheless, before completing a transaction qualified professionals should be consulted to study the property with the purpose of not finding later disagreeable surprises that prejudice interests.
NATIONAL SURVEY: Another important document that must be obtained is the “survey map”, which is obtained in the same building as the Public Registry in the office of “CATASTRO NACIONAL”. The surveyed map indicated exactly where the property is found, the Real Folio of the same, the capacity according to the survey and according to the Property Registry, form, front, back, sides, etc.
CATASTRO NACIONAL: Otro documento importante que debemos obtener es el “plano catastrado”, el cual se consigue en el mismo edificio del Registro Público, en la dependencia del “CATASTRO NACIONAL”. El plano catastrado nos indica exactamente dónde se encuentra la propiedad, el Folio Real de la misma, su cabida según Catastro y según Registro de la Propiedad, forma, frente, fondo, colindantes, etc.
1.It’s possible that some times there will be important differences between the “Survey Map” and the “Registry Report”. This is because the property is inscribed in the Registry by a notary and this constitutes really what would be a right to possession. As far as the survey, the procedures are made by the very owner and sometimes updated are neglected. It is therefore possible that we can encounter a map with some discrepancies with respect to the Registry Report.
1. NAME: another name. This is because the owner didn’t bother himself with writing his name.
2. MEASUREMENT: another capacity, which is important that it must be corrected and conscientiously studied. In general the most reliable is the survey map, because it is almost always the most recent in the Registry, but it is important that it be rectified, according to each case in particular: 1. by public writing; 2. new measurement of survey plan; 3. administrative correction by means of the registrars; 4. information on possession.
3. BOUNDARIES
4. REAL FOLIO OR CITATIONS OF THE REGISTRY: Another number of the real folio or tome, folio, number and seat. Almost always this is due to the fact that the map was surveyed before the segragation, which makes the number that appear that of the “mother estate”.
5. LOCATION: another province (almost never), canton or district: this is due to human error and is easy to correct. In every case it is convenient to take into account these errors and amend them to avoid problems at the moment of transfer.
CORRECTION OF ERRORS IN THE PUBLIC REGISTRY AND IN THE NATIONAL SURVEY:
The errors can be due to:
1.REGISTRAR ERRORS at the moment of including data in the system. To correct them the original public writing or copy of the same on microfilm must be presented to the responsible registrar.
2.NOTARY ERRORS at the moment of passing the writing to protocol. These must be corrected by the notary by means of public writing. In this case it is what is referred to as RECTIFICATION OF MEANS governed by the following:
a.If the property was inscribed before 1930 or originates from an estate inscribed before that date, it can be rectified:
- In totality up to the quantity indicated by the map, if the estate measures 5,000 square meteres or less.
- Up to 50% if it has an area of 5,000 square meters to 5 hectares.
- Up to 25% if it has an area from 5 hectares to 30 hectares.
- Up to 10% if it has an area of 30 hectares or greater.
b.If the property was registered after 1930 or origniates from an estate inscribed after that date, this can only be rectified by possessive information. The rectification by possessive information remains firm for three years after registration.
3.ERRORS IN THE SURVEY MAP. The map is corrected by an authorized topographical engineer.