Concession vs. Titled Property

Many people looking for property in Costa Rica want a beach front home only steps from the sand and waves.  However, these types of properties are almost always concession with very few exceptions.  Concession properties are those within the first 200 meters form the median high tide mark.  Fee Simple Titled properties are all those outside of the 200 meter Maritime Zone.

Concession Property: The Zona Maritimo Terrestre (ZMT) or the Maritime Zone is 95% of all beachfront property in Costa Rica.  There are a few exceptions of properties that were titled before this law was put into effect in 1977.  The Maritime Zone consists of the 200 meters from the median high tide mark; with the first 50 meters being designated as public land for public use.  The next 150 meters of land can be possessed through a granted concession; which is basically a lease that is typically 20 years and can be renewed.  Concession also differs from Fee Simple Title in that a foreigner can only own up to 49% of the concession.  A local resident must own the other 51%.  However, if a foreigner has been a resident for 5 years or more, then they can be majority or 100% owner.

The type of structure allowed on a concession property can vary from tourism hotel and restaurant to private residence.  All permits and permissions must be obtained from the local municipality; which will approve any and all construction plans.

Titled Property: Fee Simple Titled property is the same as in the U.S. and has the same absolute rights for foreigners and Costa Rican nationals alike.  As owner of this type of property you have the right to own it, use it, enjoy it, lease it, and transform the property in line with Costa Rica laws (for example cannot clear cut the rain forest to build your home).  Fee Simple property can be any property outside of the aforementioned Maritime Zone.

All title properties, as well as concession properties, will have a ‘Plano’ or plot map and are registered in the ‘Registro Nacional’ or National Public Registry.   This is public information and can be accessed online at: http://www.rnpdigital.com/index.htm

Paradise Pic of the Week

Uvita cascade and inviting swimming hole.  I had to take a dip to cool off in this beautiful spot…

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Marcharmo

The “Marcharmo” is the annual minimum liability insurance you are required to pay for all vehicles, motorcycles, or ATVs in Costa Rica.  You can pay the Marcharmo from November 1^st to December 31^st each year and the value is based on the make, model, and year of your vehicle.

The Marcharmo is not cheap and for a 2008 SUV I will pay around $800 this year, ouch!  Even an older car, motorcycle, or ATV can pay around $200.  This is a requirement and no way around it.  In fact anyone caught after January 1^st without the new decal on their front windshield will be subject to hefty fines and even getting your car impounded and towed.  Best believe the “Traficos” / “Transitos” or Transit Police will be out in full force around the entire country stopping cars at various check point searching for current Marcharmo stickers.

You can pay your Marcharmo online, at any local bank, or insurance office.   You can check how much you owe for Marcharmo and pay for it on the INS website.  In order to pay your Marcharmo you have to have all traffic tickets and parking tickets paid and if not; they will be added to the total cost of your Marcharmo.  You also have to have a current Revision Technica Vehiculo (R.T.V.) inspection sticker, which is the annual inspection every car, motorcycle, and ATV must pass to prove it is worthy of the road.

So pay your Marcharmo on time, or else your New Year will not start out too well!

Paradise Pic of the Week

This picture of a beautiful end to the day in Lagunas, Dominical was taken from our back porch.  If you have not seen a sunset in person on the Pacific coast of Costa Rica, then you are missing out!

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“Alguinaldo” – Christmas Bonus

Tis’ the season for “Alguinaldo” or Christmas Bonuses in Costa Rica.  Every December this mandatory payment for full time employees is due and many count on this for their holiday season expenses.

Often called the 13^th month of salary, the “Alguinaldo” is equal to one month’s average pay.  The easiest way to calculate your employee’s “Alguinaldo” is to take their weekly salary and multiply by 4.3; since on average there are 4.3 work weeks in each month.  Or you can add up all their annual pay and divide it by 12 to get the 1 month average.

These Christmas Bonuses could not come at a batter time because December is the most expensive month in Costa Rica with car and motorcycle “Marcharmos” (annual fee for vehicles), taxes due December 15^th, plus holiday festivities and gifts.

So make sure you pay your employee’s “Alguinaldo” on time because their family is surely depending on it for the holidays.

Costa Rica Real Estate Market Recovering

The Costa Rica real estate market was booming for years prior to the global financial crises and took a major hit as did the rest of the world.  Currently the market is recovering, prices have stabilized, and future outlook is extremely positive.  Joshua Kanter of United Country – Properties in Domincial discusses the current Costa Rica real estate trends and investment opportunities in the Southern Zone.

Playa Dominical, Costa Rica (PRWeb) November 30^th, 2012

Costa Rica has historically been a profitable real estate investment with 15%-20% year over year returns from 2000 to 2008, until the financial crises hit the U.S. and rest of the world. This once hot and booming market drastically cooled with a downward turn.  This has caused previously over inflated real estate prices to drop to realistic and fair market values over the past few years.  The result; prices are the most affordable they have been in years and investors once again are buying homes and property with the opportunity for future gains.

Foreign Direct Investment in Costa Rica 2006-2011

Foreign Direct Investment (FDI) in Costa Rica reached record levels in 2011 and is expected to outperform those numbers for 2012.  *see graph from AM Costa Rica 

International Living’s Ronan McMahon ranked the Southern Zone of Costa Rica 3^rd of 27 on the list of “The World’s Best Real Estate Markets for 2012”.  The results were based on the following criteria:

“The top five places in this Global Real Estate Index are all fast-emerging beach locales. These are places on the up…where it’s still not too late to get in. Each offers outstanding natural beauty. Real estate prices are affordable. And something is happening that I believe will push prices higher. These are places where you can work with reliable contacts; your rights are enshrined in law and the costs of buying, selling, and holding real estate range from ridiculously low to affordable.”

Ronan McMahon’s conclusion for the Southern Pacific Zone of Costa Rica was as follows:

“…Costa Rica’s Southern Zone stayed off the radar, though. And it’s nicer than up north, the area most folks know.

Bright, thick, green jungle canopy rolls down to a coast of sandy beaches and rocky points. It’s truly stunning.  And, while prices in other parts of the country soared, prices here stayed low. It was difficult to get to. But a new, smoothly-paved coastal highway has changed that… 

…It’s very good value for money. Because of the new road, I expect prices will rise. And that makes the appreciation potential strong, too.”

Costa Rica has been ranked the best country for real estate investment for the upcoming 2013 year according to International Real Estate Investments Magazine.  Not surprising considering the stable government, property rights for foreigners, and close proximity to the U.S. and Canada.  Additionally, the Baby Boomer generation is beginning to retire with many looking for opportunities abroad and this trend will continue to propel the Costa Rica real estate market for years to come.  The Southern Zone is poised for the greatest potential increase and return on investment due to advances in infrastructure, increased worldwide recognition, and ideally tropical setting.

Joshua Kanter of Dominical Property, S.R.L. predicts a positive trend in the coming years, “We have seen an increase in inquiries and buyers on the ground this past year and are optimistic for the upcoming 2013 high season and beyond. Most of the ‘Fire Sales’ have been bought up, although there are still great deals depending on an individual seller’s financial position.  The Southern Zone is Costa Rica’s last frontier and the real estate market with the most potential upswing for investors.  If the planned International Airport for Southern Zone becomes a reality; that will be the ultimate game changer for this area as it was for the International Liberia Airport in the Northern Zone.”

Contact:
Joshua Kanter, Agent
United Country – Properties in Costa Rica
Website: http://www.DominicalProperty.com
Blog: http://www.DominicalProperty.WordPress.com/
Toll Free: 1-888-679-1227