Buying Real Estate
Most Costa Rican properties are in a system known as the Folio Real system. It is a registry used for the public to keep track of ownership, locations, size of land and all the data needed to keep track of the real estate in Costa Rica. Before any purchase of property a search in the Folio Real system needs to be done. This process is important because your first question to the agent should be is the property offered by occupation or ownership rights. Occupation Rights, being a property or land that has not been registered in the Folio Real system. This is where foreigners can run into problems because there is no registration in the records that you own this property. However there is a process to still register it however it will be a long process. Now, ownership rights are registered and the equivalent to owning land in the United States. You will have a searchable record that you own this land.
Another thing to look into when buying property is whether to buy as an individual or a corporation. The limited liability of Costa Rica equivalent is call Sociedad Anonima or S.A. as its commonly seen. To qualify for this it must be incorporated by two people or more. As similar to starting an LLC in the states the S.A. will have to have a unique name that is not used already. You have to treat it like an LLC and have a board of directors as well as documented hours. This system is good to use if you have a few investors and are looking to buy larger hectors of land or go in as a development project.
The good part is, if you are just and individual looking to buy a home in Costa Rica the laws have been very good to foreigners. If you have been to Costa Rica you would probably already know how many Americans and Europeans have already purchased property in Costa Rica. This goes to show how Costa Rica is one of the most friendly places to buy in the world. Something that has scared foreigners in the past is the squatting rights. This states that if someone were to live on and improve your land while you're away they can own part or all of it. This law is only in effect so when someone passed away, if the property was not passed down to family the lot was free to move on and own. However, today with title insurance and property management companies this issue can be less of a problem. Many companies will insure your property for a one-time fee and property management companies can look after your property for a monthly fee.
