Costa Rica Property Buyer’s Checklist


This entry is part 1 of 2 in the series Costa Rica Property Buyer's Checklist
I’ve recently been working with a fellow, a prospective buyer from the US. He is a great model of what I receive from so Costa Rica property buyer's checklist imagemany of my prospective buyers when they start to get serious about the big move to Costa Rica and buying a property here.

To the right you can see what is the net result of my e-mail thread with Adrian. Due to the sheer volume of the data points, I’ll be working through this list episodically, probably in a series.

What I appreciate about Adrian’s approach is that he set out to identify the questions. This can be a tricky thing. You know how it is when you finally got the guy on the line – he’s all ears – and you’ve got your principle questions clearly in mind but the other ones, the ones that you had as you lay in bed mulling this thing over, are not coming to mind. The conversation hits that loaded pause as you try and recall those oh-so-important questions. The guy says: “Ok then. Great talking with you.”

So, here you have it. All those questions (well, most of them anyway) that you would like to have answered as you set about on the path of buying a property in Costa Rica. Let’s start with the first one:

Water Supply

This one has become the hot button for a lot of our properties. This is a recent turn in the maturing process of Costa Rica real estate. The powers that be have decided to start enforcing laws that have been on the books forever, as well as adding some new ones. It used to be that if there was a spigot that produced water when you turned the handle on or near the property, you were good to go. You had water.

Not any more.

You now need to have “legal” water. This can be from one of two sources (or both): a community water system that is known as an ASADA, or a private source that you then get concessioned to have the legal right to it.

The ASADA option requires first off that there be an ASADA system available to the property. Supposing there is, you will pay a tap fee and have a meter installed. There will be a monthly base payment of somewhere around 3,500 colones ($7.00’ish USD). High usage will cost more.

The concession option can be for surface water such as a stream, river or pond. Or it can be a well that can be hand-dug or deep drilled. Or a spring.

The cost of a concession is $1,000 – $1,500 (single family properties). I concessioned a spring that is about 100 meters away from the house for $1,000. I paid $500 about 18 months ago (at this writing) for the initial payment and will pay the balance when it is registered. Due to the newness of these changes in the law, and the ensuing press of applications, I’m hearing time estimates of up to 3 years to finish the process.

I’d venture to say that the majority of water systems in Costa Rica were rogue (read: illegal) previously. If not in Costa Rica in general, then certainly here in The Zone. It used to be that a neighbor would run a tube from his well, stream or what have you, across the road and down the hill to your property, and now you’ve got water.

Again, not any more.

  1. water supply
  2. access road maintenance costs
  3. height above sea level – temperature / misty / view spoiling clouds / mold
  4. steepness of terrain for building
  5. solar power
  6. hot water
  7. distance from amenities
  8. 2 wheel drive access throughout the year
  9. wi-fi / Internet connection / TV (uninterrupted UK soccer on weekends?)
  10. views: ocean / jungle / sunset
  11. flooding
  12. erosion
  13. Fees: HOA / water service / road / annual taxes
  14. future neighbors – build out of area

Legal:

  1. corporation
  2. death of owner
  3. soil tests
  4. survey (plano)
  5. security
  6. squatters
  7. For Sale by Owner vss Real Estate Agency
  8. title

Building:

  1. getting materials to the property
  2. wood / cement / other
  3. building in absentia vss being there
  4. fencing
  5. sewage
 

So, the topic of water is a hot one. This is because without legal water, the municipality will not grant you a building permit. There are workarounds and ways to manage the situation on most properties.

What to do if there is no legal water available. I’ve yet to see a property that has no access to water. I suppose it can happen, but I’ve not seen nor heard of it. There is usually at least one option for water.

So, if there is a short answer, here it is, water is an important topic for the land buyer, but your real estate guy will be able to help you navigate through the rocky waters. Also, a good number of properties here in The Zone already have legal water, so it might just be a moot point in your case.

Road Fees and Maintenance:
The Zone is characterized by a coastal highway that has got to be one of the finest roads in Costa Rica. It wasn’t so in the not too distant past. But it is great now. Almost all roads that come off of this coastal highway are dirt & gravel. I recommend to anyone that is interested in this part of Costa Rica to buy a four wheel drive vehicle. Pretty much everyone that lives here has one. I personally use compound low to get home.
 
OK so, the road that leads to a property is most likely “public”. This is the legal handle for the road as opposed to “private” or “easement”. As a resident of a different country than Costa Rica, you are going to think: “well then, the government will maintain the road” – NOPE!
 
The community that benefits from the road, maintains it. So, one of the questions that you want to ask, dear prospective owner of a property in Costa Rica is: what does it cost to maintain the road? This will obviously vary from one area to another. I would say that generally speaking, around $150 – $1,000 per year will cover most cases. There are many that don’t have an annual fee, but where the community just takes a collection as the need dictates.
 
There will be varying degrees of road maintenance. Sometimes all the road will need will be a new cap of material that gets compressed into the underlying material. Or, the road may need some tractor work done on it so that it is crowned for water drainage and/or perhaps there are deep ruts caused by water running down the wheel tracks in the road. So generally you keep an eye on your road and take responsibility for it. If you notice that there is some water damage starting, get your pick and shovel and divert the water over to the drainage ditch alongside. This type of individual responsibility in road maintenance can reduce the costs.
 
As you can see this is going to take some doing to get through the list.  If there are any questions pertaining to the 2 points here, or to any of the points in the list above, please feel free to use the comment thingy below so that others can benefit from the Q & A as well. I will episodically add more explanations to the points in the list with subsequent articles.