Buying or Building Real Estate in Costa Rica? Here is What You Need to Know. Part III.

 

Beach Front Property

 

Most beachfront properties in Costa Rica are untitled as ownership is by the Maritime Zone Law (Ley Sobre la Zona Marítimo Terrestre) who governs the possession of the coastline and restricts private possession and ownership.

 

According to the law the beachfront its owned by the government ranges from the area of shoreline, measuring 200 meters from the high-tide mark. Of this 200-meter area, the first 50 meters are considered public zones and nobody is authorized to possess or own it. The remaining 150-meter area is controlled by the local municipal organization, which can lease it through concession to private entities.

 

The Maritime Zone law poses restrictions to foreign possession and ownership of the beachfront properties and this calls for some thorough and detailed research when you consider a property in Costa Rica’s beachfront.

 

I want to build. What should I do?

 

If you are interested in building in Costa Rica, you are very likely to face a ceremonial mesh of governmental and legal decrees. The law demands an architect or an engineer, who has a license, do the presentation of any application of building permit (Article 83, Law of Constructions, and Article II.2 Construction Regulations). Therefore, it is obligatory for you to consult a reputable and licensed civil engineer or an architect, who can guide you through the process of application and the construction norms.

 

What do architects and engineers charge?

 

All engineers and architects should be licensed to the Association of Engineers and Architects, Costa Rica, known as the Colegio Federado de Ingenieros y Ingenieros y Arquitectos-CFIA. This body governs the fee-schedule, according to which professionals should charge their clients.

 

Most fee structure is predicated upon a certain percent of the value of the construction project. As for the CFIA or Reglamento para la Contratación de Servicios de Consultoría en Ingeniería y Arquitectura, the participation of any licensed architect or an engineer can be differentiated in to two phases. The first phase consists of planning the construction and getting permits for it, and the second phase comprises controlling and execution of the plan.

 

Phase 1: Construction plans and permits

 

This phase can be further differentiated in terms of several professional services that the architect or the engineer is to deliver to his or her clients. The following data list shows the minimum chargeable fees as par CFIA dictum.

 

• Preliminary studies or estudios preliminaries: 0.5%. These studies may or may not be necessary, and the necessity depends solely on the possibilities of the project.
• Pre-project design or anteproyecto: 1 - 1.5%. in this phase usually the architect or the engineer meets up with the clients to the discuss the latter’s needs and requirements. With the understanding of these, the architect or the engineer will prepare initial drafts for the clients’ consideration.

     The drafts include planning of the site and initial work drawings. Before you enter and agreement with an architect or an engineer, make sure to clarify everything that you are expecting from them and what they are going to provide you.

• Construction plans and technical specifications or planos de construcción y especificaciones técnicas: 4%. This is among the most crucial aspects of your project, as the success of you construction solely depends on the accuracy, quality and reliability of the plans of construction.

Once your architect/engineer and you strike a common note of consent for the design and the layout of the project, he or she will start working on drafting the plans. An exemplary set of plans in Costa Rica should ideally include the following: a site plan, a plan for distribution, plans concerning elevation, longitudinal and transversal perspectives, drainage and roof designing, designing support beams and footings, plans regarding general and specified structures, electrical designing, designing mechanical systems and sanitary systems, and designing the interior finishing of all the constructions.

• Budgeting or presupuesto: 0.5% for global finance planning and 1% for itemized finance planning. Here, your architect or your engineer will prepare a list of materials essential for construction purposes basing upon the plan and sets up a budget for construction.

 

Phase 2: Control and execution

 

This phase includes the actual execution of the construction plans and involves project supervision. The regulations make provisions for three primary kinds of supervisory responsibilities, each of which demands huge involvement of the architect or the engineer and he or she is expected to invest quality time over this.

 

Inspection or Inspección – 3% of the aggregate construction value. Here, your architect or your engineer will pay visits to the site of construction in order to ensure that all the specifications for the plan are being followed by the contractor. They will also ensure the use of quality materials in the construction and review the invoices that the general contactor produces to them.

 

Supervision or Dirección técnica – 5% percent of the aggregate value of construction. This expects of the architect or the engineer more involvement and directive daily operation of the project.

 

Administration or Administración – 12% of the aggregate construction value. In this case, your architecture or engineer will take entire responsibility for the implementation and realization of the project.

 

The option you take and the choice you make will be prompted by the nature of your project, the dependability of your builder or your general contractor, and the amount of time you want to assign to the completion of the project.

 

As already been elaborated earlier, costs of phase 1 and 2 can range between 9 and 18% of the projected value of the construction, depending upon what services you want to avail. In general circumstances, fees for your architects and engineers are negotiable. Most of them will be eager regarding your business anticipations and will accommodate themselves according to your needs and requirements, thereby working out a similar agreement. In case things do not turn out so favorable, you can have your attorney do the negotiation so that you get the best deal possible.

 

Before you sign any contract, make sure that it as transparent as possible so that you know exactly how the fee-structure is and you have complete knowledge regarding what all are included and what not. You should also clearly mention what responsibilities you want them to perform. Repeat the same procedure with your builder, general contractor and all sub-contractors.

 

 

Construction permits

 

While purchasing a lot with the intention of building on it, you should carry out careful and detailed research regarding the same to guarantee that you will not have to face any difficulty in obtaining a building permit from the authority.

 

Primarily, ascertain whether the lot is provided with the basic services like water and electricity provisions, telephone services and proper drainage.

 

Second, determine that there are not any restrictions on the given lot, which, if unchecked, may result in the denial of permission for construction. Searching and verifying the Public Registry might not be adequate.

 

You should also verify with the Ministry of Public Works (or Ministerio de Obras Públicas y Transporte), Costa Rica for projects in road construction; the National Institute of Housing and Urban Development (or Instituto Nacional de Vivienda y Urbanismo); the Ministry of Health (or Ministerio de Salud) and the municipality where the property is located (or municipalidad).

 

Finally, be posted about any sort of environment regulatory functioning that may affect your project of construction, as the Costa Rican national wildlife refuges or areas protected against trespassing by the Forestry Law.

 

Every or most of the following agencies need to approve your application for construction permits:

-       CFIA or Colegio Federado de Ingenieros y Arquitectos;

-       MOPT or Ministerio de Obras Públicas y Transportes – roads;

-       INVU or Instituto Nacional de Vivienda y Urbanismo – housing;

-       ICE or Instituto Costarricense de Electricidad – telephone;

-       AYA or Instituto Costarricense de Acueductos y Alcantarillados – water;

-       SNE or Servicio Nacional de Electricidad – electricity; and

-       Ministry of Health (Ministerio de Salud).

 

You can ask your engineer or your architect to guide you through the approval procedure as a part of their services.

 

In order to get a permit for building a single family home, of say around, 70 meter square (or 735.2 square feet), you must provide the authorities with the following necessary documents: 4 copies for the plan of construction, 4 copies of the asset cadastre plot-plan or plano catastrado, 4 copies of the checklist for the permit or hoja de comisión, 2 property deed copies or escritura, 1 copy contract of consultation with your architect/engineer or contrato de consultoria, a water-company (AYA) approval regarding water availability, and finally, 1 copy of your SNE-approved electrical design plan.

 

Condo-projects, constructions aimed at commercial purposes, projects for urbanization, etc. need to satisfy further requirements in order to acquire permits for construction. Along with these requirements, you will have to apply for a construction permit from the local municipal organization. Legality delegates the municipality the responsibility to see to it that every construction detail meet the terms of building regulations (par Construction Law, Article 1). Therefore, you may anticipate regular trips by the municipal inspector of building to your site of construction. The municipal inspector will then certify whether the construction proceedings are happening in accordance with the code.

 

Whether you are planning to buy an existing property, or are deciding on buying a land in order to develop your own dream home, keep yourself up to date about all the necessary legal procedures in order to ensure that your investments fetch you nothing but profit.