As the saying goes “All good thing can come to an end”. The same can be said about your Costa Rica property. Selling your property doesn’t have to be difficult, provided you are well-prepared in advance. Selling will be much easier if the property is properly priced and marketed, but there are some things you need to know beforehand to make the selling process as smooth and stress-free as possible.
Most properties are held either in a person’s name or a Costa Rican corporation. Note that property here in Costa Rica can be held in your name, in a Costa Rican corporation, in a trust or even a a foreign corporation (outside Costa Rica). No matter how you choose to own your property, it is important to know what is required to complete a sales transaction.
The things required to complete the sale of a Costa Rica property depends on how the offer to purchase your property is written, and how in-depth the due diligence will have to be (as requested by the buyer’s attorneys).
No matter how your property is held (in your name or the name of a corporation), I highly recommend you use your local Costa Rican “Notario” (notary) or an attorney to assist you in the selling process, which will include obtaining a number of documents required to complete the transaction.
Here is a list of items that may be required to sell your home:
1) Proof of legal water availability: whether from AYA (Instituto Costarricense de Acueductos y Alcantarillados), local municipality where the property is located, legally registered private well or from an ASADA (Asociación Administrativa del Acueducto) in other words a legally registered private water association.
2) Proof of electrical service along with the company providing service and the current contract number.
3) If the property is a house or a condo, Municipal building permits will be required to ensure it was legally built.
4) Proof of property taxes paid up to the date of closing. You can obtain this from the local municipality where the property is located.
5) Proof of all utilities being paid up to the date of closing (water, electricity, cable and telephone).
6) If your property is a home or a large condominium, proof of the Solidarity Tax Assessment and, if subject to the tax, proof that payments are up to date from 2009 to the date of closing (Impuesto Solidario para el Fortalecimiento de Programas de Vivienda or roughly translated as the Luxury Home Tax).
7) If the property is in a registered Home Owners Association, or a Legal Condominium Association, you may need to provide the rules and regulations of the development, the minutes from the last meeting, as well as the financial report of the development. All Special assessments as well as monthly maintenance fees will need to be paid up to the date of closing.
8) A “Certificado Catastral” or certified plot plan/survey of the property.
9) A “Literal de Inmuebles” or a certification of the property.
10) A copy of your valid, non-expired passport.
If your Costa Rica property, whether a house, condo or raw land / lot is registered under the name of a Costa Rica corporation there are benefits that make selling the property easier.
These benefits may include: A) Not having to be present at the closing. By having a detailed special power of attorney (SPA) and an updated shareholders meeting (which can be done by proxy) logged in the corporation legal books reflecting the special power of attorney, then the person you designate can sign the closing on your behalf here in Costa Rica.
B) Shares of the corporation can legally be transferred to a new buyer and, again, a special power of attorney (SPA) will be needed for this as well.
If your Costa Rica property is under your personal name most likely you will be required to be present at the closing to sign all documents, which is not a bad thing when you get to experience Costa Rica maybe one last time?
However, you can still do a special power of attorney signed in front of a registered Costa Rica “Notario” Notary. The least expensive way to do this is to have you attorney draft the special power of attorney and send it to the closest Costa Rica consulate near you. Once the SPA has been approved then an appointment date and time will be set for you to go to the consulate and sign the document.
So, in order to make selling your Costa Rica property a hassle-free experience, be prepared before an offer to purchase is presented.
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