Invest in Costa Rica: The maritime zone.
The dream is to buy a beach house and invest in Costa Rica. Costa Rican beachfront properties are beautiful! Acquiring beach front property is a fantastic idea and a sound investment. Costa Rica is a less hurried land where you can relax. Can foreigners acquire beachfront real estate in Costa Rica? Yes, but you must have special care with oceanfront real estate in the Costa Rican maritime zone. Even though private property is respected in Costa Rica, according to our secure constitution, all beaches are public. This is a grey area, at the legal boundaries between what is private and public property. It engulfs the Costa Rican maritime zone, which is something to consider if you wish to acquire a Costa Rican beach front property.
When considering beachfront properties, you should know about the maritime zone Area and State Concessions. It’s not really a choice but a necessity for a secure, legal investment. This is not your everyday due diligence. The maritime area changes the rules of the game because we are no longer talking about private properties but rather State concessions. It´s a whole new ball game.
What is the maritime zone? Is Costa Rica oceanfront real estate privately owned?
If you wish to buy a beach house in Costa Rica, chances are, it will be inside the maritime zone. Imagine the ocean in front of you. The maritime area, by law, is not privately owned. This State-owned area, known as the maritime zone, is the 200-meter wide strip of land along the shorelines. It runs two hundred meters from the mid-tide line. All beaches are public by law, so these areas have no private ownership. This is something to consider, if you wish to invest in Costa Rica. According to Costa Rican law, the maritime area is divided into two zones:
1. The first 50 meters of the Costa Rican Maritime zone (the public zone):
The first fifty meters from the mid-tide line is called the public zone, which also extends to islands. This is the maritime public zone, for public use, where families and the public in general can enjoy the beach. All beachfront real estate developments and edifications are banned in this public area.
2. The remaining 150 meters of the Costa Rica Maritime zone (the restricted area):
The law designates this as a restricted zone from the end of the public area and up to another one hundred fifty meters inland. This is where the oceanfront real estate is located. If you wish to buy a beach house in Costa Rica, this is where it will located. However, these are not private properties. To acquire or develop these beachfront properties, you must obtain a concession from the State of Costa Rica. This concession gives you the right to use and enjoy this area. You can develop and build your dream beachfront home in this restricted area with the necessary permits.
The local governments of Costa Rica, or “municipalities,” grant concessions to use and enjoy the land in the restricted zone for a determined time frame. So even though you can’t technically buy property in this area, you can acquire the concession from the Municipality or from the person to whom the concession is given. Concession time frames vary from municipality to municipality but are usually given for twenty years and may be renewed constantly.
Be careful. You are not purchasing privately owned beachfront properties, but rather a State concession:
You can certainly acquire the concession that has a beachfront home in Costa Rica. But as a lawyer, I must advise you to be very clear. If you invest in Costa Rica, in the maritime area, you are not acquiring a privately owned real estate property, but rather a State Concession. It’s important to know what you are getting yourself into! It’s always much better to buy private-owned real estate in Costa Rica, with a secure property title in the Public Registry, which is what most people do.
Every municipality has a Municipal Regulations Plan that establishes the zoning of each concession lot. If the municipality grants the privilege to build houses, you have every right to build one. As part of due diligence, it’s essential to investigate zoning when purchasing beachfront property in Costa Rica, especially in the restricted zone. Even though zoning might allow building, obtaining the necessary permits is still required before proceeding. The person entitled to the concession must also pay a benefit to the municipality, which substitutes the territorial tax. Both the local municipality, and the Costa Rican Tourism Board, or ICT ( Instituto Costarricense de Turismo), supervise the State given concessions.
Can foreigners get a concession in Costa Rica? Things to know about beachfront real estate concessions.
Since a concession is not private property, you can´t transfer, sell, compromise, or mortgage it. You need authorization from the Municipality and the Costa Rican Tourism Institute for most things. There is no mediation nor arbitration with the State. Sorry, but no concessions can be granted to foreigners who have not resided in the country for at least five years. Neither can they be given to corporations constituted entirely by foreigners or to corporations whose shareholders are foreigners, in at least 50%. There are, however, many ways around this. Many people opt to have Costa Ricans set up the corporation and later on acquire the shares.
You may ask yourself, what happens if you build a house in a restricted area, and the Municipality decides not to renew the concession? The municipality can deny the concession renewal for several reasons. These range from public interest reasons, convenience, contract breach, or if the property ends up in the public zone. If the concession is extinguished for reasons that are not your fault, then the State must pay for the just price and costs of the uplifts, similar to an appropriation. If you are looking into buying a home in Costa Rica, avoid a headache and buy one that is not in the maritime zone.
Where can I find Costa Rica real estate beach front properties for sale?
That´s the easy part. You can choose between the two ocean coast lines to invest in Costa Rica. Maybe you like the Caribbean vibe? In this case, you should visit Limón, which is beautiful.
I prefer the Pacific Ocean. I recommend visiting the Manuel Antonio area in Puntarenas or heading to Guanacaste. You will find that buying Guanacaste real estate is a dream come true. This area is dryer and has white beaches and incredible sunsets. Even though Guanacaste is far from San Jose, the Liberia International Airport is convenient. Tamarindo is a popular place to buy Guanacaste real estate.
Many ex-pats, however, enjoy purchasing Costa Rica beachfront real estate in Jacó. Jaco is close by to San José, the capital of Costa Rica, which makes it an ideal choice for many expats. Buying a vacation home in Costa Rica makes sense. Our country is beautiful and peaceful. We don´t even have an army!
There are many places to purchase Costa Rican beach front real estate:
Acquiring Costa Rican beach front real estate is an excellent idea. If you are looking into buying a vacation home in Costa Rica, there are many places to choose. Even near the beaches! But I always advise that you buy a home in Costa Rica that´s titled property. Concessions give you a lot of limitations. However, if you are set on acquiring the concession, our real estate law firm can help you with the process. If however, you wish to invest in Costa Rica, buying privately owned real estate properties, you should check my article on how to buy properties in Costa Rica.
Dr. Christopher Pirie Gil.
