Costa Rica real estate can be freely bought and sold by both foreigners and nationals. The Costa Rican constitution fully protects both with equal ownership rights making it a safe emerging market for international real estate investors. Purchasers of property can also obtain a title guarantee from internationally recognized title insurance companies.
Real estate can be held in a personal name but it is advisable for people to hold the title of property in Costa Rica through a local corporation. Although these entities can be useful for many other things, in this case they serve merely as a vehicle to hold and manage the ownership of the house, lot, condo, etc. involved. A common practice has been to transfer the shares of an existing company that owns the land to be purchased, instead of transferring the actual property to a third party.
When you acquire the shares of a corporation in Costa Rica along with the company’s assets, in this case the property, you will also acquire its liabilities. For this reason, it is essential to perform a deep corporate and title search during the due diligence period. This step will verify that the entity being transferred with the property is in appropriate legal standing in the national registry and court system. if the corporation can not be transferred for any reason or if there is any question, the buyer can easily create a new holding company.
These legal entities also help create a layer of protection for the owner of Costa Rica real estate. Registering assets under a corporation shields the owner from personal liabilities. By Costa Rica law, the assets of a company are considered completely separate from the personal assets of each shareholders.
This process can be navigated with the assistance and advice of a professional real estate agent and attorney. Those who purchase Costa Rica real estate should never take the advice from an unlicensed realtor or unqualified real estate attorney. This is the best assurance of a smart decision and a safe investment.