Brought to You by Package Costa Rica
May 2007
Traveling
Bajos del Toro: A Well-Kept Secret that is Getting Out
From time to time we will feature articles about areas of Costa Rica that are up and coming. Bajos del Toro is definitely one of those.
GEETING THERE AND THINGS TO SEE ALONG THE WAY…
The location is in the shadows of the Poas Volcano. To get there you take a right turn in front of the famous oxcart factory in Sarchi. At this point you pretty much leave civilization. You will drive through a protected zone of the the Rio Toro. The road is very narrow at times and the shoulder drops to oblivion. But the views are fantastic. You will climb the mountains to about 6,000 feet and then start descending to the little village of Toro Amarillo. Word is that the folks that brought us the Punta Islita resort in Guanacaste are building a five star hotel right there in this tiny little farming village. If they do anything as nice as Punta Islita, this place will be booming. This little valley is also called Valle de Truchas because there are many places where you can fish for trout from the Rio Toro and have someone cook them for you right there on the spot. One of these places is Nene's. Nene also has cabins where you can stay very cheaply and a nice little restaurant where they will cook you all the trout you can catch and/or eat. I am very excited about this area from a real estate standpoint. If the five star hotel goes in you are going to see prices in the area skyrocket. Right now you can buy land for anywhere from $5 to $10 per square meter, but once the hotel is in, land will likely go for as much as $20. It is also only about a 20 to 30 minuite drive from Sarchi, a bustling medium sized town (which by the way is the furniture capitol of Costa Rica) and only about 1.5 hours from San Jose. We are probably 2 years out from seeing this jump in prices, so now is a good time to get in. It is a charming and peaceful area full of beauty and ecological diversity.
CATARATA DEL TORO
Costa Rica is known for its amazing rivers and waterfalls. But the most spectacular in my opinion is right here in the Bajos del Toro. It is known as Catarata del Toro. My friends, Donais and Will have the only way you can gain entrance to the falls. They own about 100 hectares around the area of the falls. They have done some amazing work to make the falls accessible by building a walkway all the way down to the base. Once you descend down you will see something truly amazing. The water from the Rio Toro has a high acid content because it flows directly from the Poas Volcano. In this are called the cloud forest you will see many of the giant plants that we call sombrillas, or umbrella plants. At the base of the falls you will notice that the sombrillas look as if they have been torched. I mean charred as if by a flame. How can that be in an area that stays completely wet 365 days of the year? It is because of the spray from the waterfall contacting with the plants and the acid content burns them in this way. I have never seen anything like this anywhere else.
RAPPELLING EXPERIENCE
Also, Donais and Will run a rappel tour right down the rock face beside the thundering waterfall. It is a 400 foot adrenaline pumping experience. They also have a gorgeous little restaurant where you can get the best arroz con pollo in the country, as well as other great dishes. They have three cozy little cabins in case you decide to stay for a while. Trails around their property will lead you through the cloud forest where you can see a great variety of birds and Donais has even reported seeing Pumas on her property. The place is truly amazing.
Very few know about this great location. Tourist buses don't go through here, although in my opinion it is the most beautiful and fastest route to La Fortuna and the Arenal Volcano. Also, once you hit the highway if you go the other way you will end up in Varra Blanca, which is also a great place full of beauty. Also close by is the Sarapiqui River, one of the best for rafting in the country. It only takes about one hour to get from Cataratas del Toro to Arenal and the roads are quite good. Although, once you hit the highway you will quickly notice that it is a major truck route, which can make for some hairy night time driving. I am quite sure that the word will get out about this place. Will and Donais are certainly trying to make sure of that. Please take a look at their web site, Catarata del Toro. We are now taking all of our customers in route to the Arenal Volcano through this wonderful place and to date everyone has been extremely thankful for it.
For more information about how to get there or even to set up a tour to the area please visit our Travel Website or give us a call toll free at 1-866-424-6439. We also do Real Estate Exploration Tours and would be glad to show you opportunities in this or other areas.
Investment
Buying or Building in Costa Rica - What you Need to Know
By Roger A. Petersen
Part I: Buying
Reprinted with permission from Costa Rica Law.Com
Edited for length by The Costa Rica Zine Editorial Staff
Buying property and constructing buildings or a home can be an intimidating process, even when you are at home in your own culture and knowing what to expect and plan for. In a foreign country, the same processes can be downright frightening. In a new setting, you need to learn what the usual way to go about things is and also who is legally and ethically responsible for what. In other words, you should invest some time in learning how things work and how to protect your investment.
Fortunately, in Costa Rica there is a defined process through which an intelligent buyer and builder should proceed. In addition, there is a licensing body for Architects and Engineers, which also sets standards for fees should you decide to build. But let's start at the beginning.
I WANT TO PURCHASE PROPERTY IN COSTA RICA. WHAT IS REQUIRED?
So you've found, either through a real estate agent or your own searches, a piece of property that is perfect for you. Once you have negotiated a sales price and the seller has accepted your offer, then the legal procedures for transferring ownership of title begin.
HOW IS TITLE TRANSFERRED?
In Costa Rica, property is transferred from seller to buyer by executing a property transfer deed (escritura) before a Notary Public. Unlike common law countries, such as the United States and Canada, where the role of the Notary Public is limited to authenticating signatures, in Costa Rica the Notary Public has extensive powers to act on behalf of the state. The Notary Public must be an Attorney and he or she may draft and interpret legal documents, as well as authenticate and certify the authenticity of documents.
In order to close on the property, the buyer and seller must select a Notary/Attorney who will draft the transfer deed and register the sale in the centralized property registration office known as the Public Registry (Registro Nacional). All documents are centralized at this location. As such, all deeds executed in the provinces of Costa Rica must be filed in the Public Registry. The local custom is that the buyer may select his or her Notary/Attorney to draft the property transfer deed if the buyer is paying cash for the property.
At your option, the property can be purchased in an individual's name, jointly with other persons, or in the name of a corporation. The decision as to ownership should be based upon your particular situation and after consultation with your Attorney.
HOW CAN I ENSURE THAT I HAVE CLEAR TITLE TO THE PROPERTY?
Costa Rican law requires that all documents relating to an interest and/or title to real property be registered in the property section of the Public Registry (Article 460 of the Civil Code). Most properties have a titled registration number known as the folio real, and the records database can be searched with this number or by name index. The Public Registry report (informe registral) provides detailed information on the property, including the name of the title holder, boundary lines, tax appraisal, liens, mortgages, recorded easements, and other recorded instruments that would affect title.
Since Costa Rica follows the doctrine of first in time, first in right, recorded instruments presented to the Public Registry are given priority according to the date and time in which they are recorded. Obviously, every situation differs and in some cases a review of the Public Registry record will not be enough to uncover all encumbrances. That is why it is important that the buyer have her or his own attorney conduct an independent title search and investigation rather than rely on the seller's attorney.
HOW ABOUT CLOSING COSTS?
The general custom is for the buyer and seller to share equally in the closing costs. This can be modified by agreement and usually depends upon the particular transaction. Closing costs involve three things: Government transfer taxes and registration fees, Notary Legal fee, and mortgage costs, if any.
Government Transfer Tax and Registration Fees
Real Estate Transfer Tax. The government collects a property transfer tax (Impuesto de Traspaso) which is equal to 1.5% of the registered value of the property. The Public Registry will not record a transfer deed unless the transfer taxes and documentary stamps have been paid.
Documentary Stamps. The government also requires that documentary stamps be affixed to the deed. The Public Registry also imposes its own tax of .05% on documents presented for recordation to the Public Registry. (Derechos de Registro)
Notary Fees. The Notary that drafted the contract for sale carries out the real estate closing and records the property title transfer is entitled by law to a fee which is based upon a percentage of the value of the transaction. The original decree established a fee which was equal to 1.5% of the first one million Colones of the actual sales price and 1.25% on the balance. The Attorney and Notary fee schedule was modified in August of 2005 (Decreto Ejecutivo Nº 32493-J) and now provides as follows:
Up to 10 million Colones 2% of the value of the transaction
On the Excess of 10 million Colones to 15 million Colones 1.5%
On the Excess of 15 million Colones to 30 million Colones 1.25%
On the Excess of 30 million Colones 1%
The buyer should be aware that Costa Rican real estate transactions commonly operate on a two-tiered system. Since many Costa Rican properties still have a realatively low property tax appraisal base in relation to market value, it has become a local practice to run property sales through at the registered value, which may be substantially less than the actual sales price of the property. In such a case, all transfer taxes and fees discussed above would apply to the registered value as opposed to its sales price, with the exception of the notary fee. Buyers should consult with their Attorney about the potential risks involved in undertaking this practice.
REGISTRATION OF THE TRANSFER DEED.
Once all the fees have been paid, it is the obligation of the Notary Public who drafted the transfer deed to ensure that the deed is presented (anotado) and registered (inscrito) in the Property Section of the Public Registry. I have stressed the words presented and registered to highlight the importance of following up with the notary to ensure registration. Although presentation guarantees your priority (i.e., first in time, first in right), it does not automatically guarantee registration. The Public Registry will not register a transfer deed unless all taxes and registration fees are included; a certified copy from the Municipality where the property is located is provided certifying that the seller's property tax (bienes inmuebles) and municipal assesments (impuestos municipales) have been paid through the date of closing. Likewise, any prior instruments that encumber the property (i.e., mortgages, liens, judgments, etc.) must be lifted before your transfer deed will be registered.
Once a transfer deed is accepted for registration, the Public Registry will return the original document with all the documentary stamps affixed to it and properly sealed. Assuming no defects in the transfer deed, it should be registered by the Public Registry with 45 to 60 days after presentation. It is therefore important to follow up with the Notary Public to ensure registration, otherwise you will run into problems in the future when you decide to resell the property and find out that your sale was not properly registered.
Stay Tuned for Part II of the above article (on Building) in the next issue of The Costa Rica Zine…
Tico Style
Things that Really Matter
The following appeared in my person Costa Rica Blog that I normally use to bring humorous stories and anecdotes about life in Costa Rica. I thought subscribers of The Zine might enjoy it too.
This morning I sat down to write, but nothing immediately came to mind. Then a thought hit me. Since I have spent the last hour or so thinking about God, I am motivated to write something about that subject. I don't know where you might be personally on this issue. But I can tell you that living here in Costa Rica can bring you closer to the Creator and Sustainer of all this incredible beauty. That is, of course, if one were predisposed to focus on such matters. The grandeur and majesty of the mountains that face me each morning when I step out onto the balcony of my apartment. The incredible sunsets and brilliant colors that fill the sky up each evening. The many varieties of birds that are singing outside my window and distracting me as I try to write this. The smiling faces of ticos (well except when they are behind the wheels of their vehicles.....then they look more like demons). All of these things bring me closer in my relationship with the man upstairs. All this beauty can't just be by accident, can it? There must be some intelligence behind this incedible work of art that is Costa Rica. It takes less "faith" for me to accept and believe that, than to choose to believe that it is all the result of some cosmic explosion and that this incredible lanscape teaming with every description of life, well, just evolved randomly. Come on. I wasn't born yesterday. Don't worry I am not going to preach to you. Just want to maybe shift your perspective. I don't know where you might be, physically or spiritually. But take a moment to reflect on the beauty that is all around you. The majesty. God is the author of it all. And what is even more fantastic and amazing is that the Supreme Being made you too and loves you more than you can imagine. I hope these blogs about Costa Rica inspire you to one day make a venture here. If you do please look me up. I would love to share more along these lines. And at the same time show off the country that I love and demonstrate to you why it has been said that Costa Rica is....The Last Country God Made!
Just another little cultural tidbit from your "gringo" Costa Rica Expert.
Advice
A Legal Guide to Costa Rica
Book Review by Scott Bowers, Editor of The Costa Rica Zine
From time to time we will bring you reviews of excellent resources we have come across that can help you in your transition to the Pura Vida life. One such resource is The Legal Guide to Costa Rica by local attorney, Roger Peterson.
Whether you are contemplating business transactions or intend to live in Costa Rica, it is very likely that you will come in some sort of contact with the Costa Rican legal system. It may involve something as routine as forming a corporation to actual litigation in Costa Rican courts. Most people are totally lost when it comes to understanding and operating within the Costa Rican legal system and the results can sometimes be disastrous.
Whether you are contemplating business transactions or intend to live in Costa Rica, it is very likely that you will come in some sort of contact with the Costa Rican legal system. It may involve something as routine as forming a corporation to actual litigation in Costa Rican courts. Most people are totally lost when it comes to understanding and operating within the Costa Rican legal system and the results can sometimes be disastrous.
The Legal Guide to Costa Rica provides the reader with easy to follow information about the Costa Rican legal system and laws. Each chapter is organized into a specific area of law which in turn provides valuable information on several legal topics.
Topics include real estate transactions, corporations, immigration, marriage and divorce, commercial transactions, powers of attorney, environmental laws, copyrights, trademarks, worker’s compensation, automobile regulations, taxation, social security, labor legislation and much more.
The Legal Guide to Costa Rica was written by Roger Petersen. Mr. Petersen is an Attorney at Law, member of both the Costa Rican Bar and Florida Bar. In addition to his legal education, Mr. Petersen earned a Bachelors Degree in International Relations from Tulane University and an M.B.A. in Banking and Finance at the San José, Costa Rica Campus of National University..
You can order the book directly from Mr. Peterson’s web site at www.costaricalaw.com. It sells for only $27.50 per copy. Based on my reading, it is well worth the money for anyone contemplating a move to Costa Rica. The web site itself also serves as a valuable resource.
Pura Vida Mae!
Scott Bowers, Editor