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Who doesn't want to live in paradise? The beautiful country of Costa Rica is rich with a beautiful tropical climate while lying below the storm belt. It has diverse and vibrant flora and fauna and has the most breathtaking natural resources in the world. Plus, it has a stable democracy and a thriving tourism and travel sector, which means a lot of opportunities for people looking to invest in real estate in the country. So, let’s take a look at how you can buy real estate in Costa Rica.
Process of Buying Real Estate in Costa Rica
The process of buying real estate in Costa Rica is pretty similar to the US system. There is a title, a period of carrying out due diligence or inspections, and a period where the attorney has to review the process as well before it becomes official. All of this is done to ensure the investor is protected. One thing that is different between the US and Costa Rican processes, however, is in the US, the title company is the head of the operations, but in Costa Rica, it is the real estate law firm that is the center of operations. The escrow has a different part to play in the process. It is an independent corporation that is authorized by the government to receive funds for the transaction and to ensure the money is clean and perfect for a real estate transaction.
The country, however, does not provide title insurance; however, this is due to its own lengthy registration requirements, which can take a long time to complete, which has deterred US companies from offering title insurance here. Nevertheless, US companies believe it is a safe country to provide title insurance because of its strong public registry system.
Role of Limitada or LLC in the Real Estate Investment Process
Using limitadas is very common in Costa Rican real estate investment. In about 99% of real estate transactions, the property will go into a Costa Rican LLC. This is an independent entity that holds your assets and keeps them fully protected. For estate planning, you can simply put the capital stock of a limitada into a Costa Rican will or make it a part of the trust. A limitada also offers various benefits to the property owners as well. For example, if the owners are unable to come to a shareholder meeting, which is called a quota meeting in Costa Rica, a power of attorney can be used to hire someone who can act on behalf of the owner.
Kind of Vacation Rental Investments Being Made in Costa Rica
A lot of people who come to Costa Rica come for a second home and a different lifestyle. However, they quickly realize that their property can become an investment itself. As such, a lot of people are using their property as an Airbnb rental home. Costa Rica has amazing communities all around in the South Pacific, North Pacific, and Central Pacific. The south is a favorite since it offers tropical rainforests, and the north is also a favored spot since it has dry tropical forests and is near small towns. Hence, most people are looking for a nature-based lifestyle.Many people also come to buy a big piece of land or property because they want to enjoy the freedom of having their own property. Condominiums in busy towns are also a lucrative option for people looking for vacation homes since they can be rented out six to seven months a year, meaning it will pay for all its costs, plus give the owners a nice amount of extra money.
Building a Multi-unit Building in Costa Rica
Once an investor has identified a piece of land that he likes, the first step is to perform due diligence. This will involve various steps, including bringing a surveyor who can determine whether your property is overlapping with another property and that all the boundaries are correct. It is also important to bring an architect or a builder to the land who can help you understand what you can build and develop in the area. You also need to communicate with the local authority or the municipality to find out whether there is a demand for bigger developments or housing to ensure that your property development goals are within their vision of the area. It can take anywhere between 12 to 18 months before you can start breaking ground in Costa Rica, so investors need to ascertain a realistic timeframe if they want to build a property in Costa Rica.
Costa Rica as an Investment-Friendly Country
During peak tourism periods, it is not possible to buy or rent a house in Costa Rica. This includes vacation rentals that cost $750,000 each and thousands of dollars a night. In addition, Costa Rica is very attractive to big-name hotel builders like the Four Seasons and the Ritz, which is a good indication to investors that vacation rentals and multi-unit buildings are very rewarding here.
Bottom Line
When coming to invest in Costa Rica, it is important to be patient and to first understand all the laws and regulations of the country before you start investing. This will give you a safer and more informed way to make your decision and increase your confidence when it comes to Costan Rican vacation rentals. If you want to purchase a vacation rental property in the beautiful country of Costa Rica, we have tons of resources that can help you get a lot of information on how to make global investments in real estate. 
