Demystifying local real-estate related terms
As they say, ‘You’re not in Kansas anymore’. The real estate market in Costa Rica is modern and well regulated, however it presents many aspects which are unique to our area, not to mention that the technical jargon and even common expressions are usually expressed in Spanish! But this is where we come in, making things simple and stress-free so all you have to worry about is ‘mountain view’ or ‘ocean view’?
This article will be extremely helpful to people who are on a mission to make a new life in Costa Rica and while your real estate agent will be well-versed with the local process and lexicon it is essential that the property buyers are at least familiar with the considerations presented below. The information is for reference only and does not dive into the full, complex definitions of the terms – this is the case-be-case domain of real estate agents and, especially, subject matter experts and lawyers who are knowledgeable in the fine details of the laws.
(A) COMMON SPANISH EXPRESSIONS IN USE IN THE COSTA RICAN REAL ESTATE MARKET – These Spanish terms have made their way into the English vocabulary of local expat residents and real estate professionals alike – often to the confusion of newcomers. Being familiar with many of these terms is essential for anyone looking to resettle into our area. You can either learn them here or pick them up slowly as they come up – but we recommend you study the list below!
COSTA BALLENA (‘Whale Coast’) Our local area stretching from Dominical in the north to Uvita in the middle and down to Ojochal and Palmar in the south. Known for idyllic beachfront and surfing towns, world class dining and surfing, unspoiled jungle and mountain scenery, ecotourism, wildlife, beautiful beaches, fishing, whale-watching and recreational activities.
COSTANERA The major (and only) highway along the Central and Southern Pacific coast of Coast Rica. Also known as Carretera Pacífica Fernández Oreamuno, Carretera Costanera Sur, Ruta Nacional Primaria 34, Ruta 34, Route 34, or ‘the highway’. But locals refer to it simply as ‘Costanera‘. The road is single lane in each direction, with occasional passing lanes, and undivided.
DENUNCIA A criminal complaint that can be filed by any person present in Costa Rica. In real estate context often used to challenge illegal construction, environmental damage, land encroachment or setback violations.
FINCA (‘Estate’). In Costa Rican real estate context a loose terms that can refer to rural land, agricultural land, or a rural or urban lot, with or without other structures present. A catch-all phrase. Another term used for Finca is ‘Propiedad’.
HACIENDA (1) Another loose terms in our area – it generally refers to a very big house with multiple rooms and bathrooms, or a large house on huge land, forest, garden or farm grounds. But in general, an above-average-sized family or multi-family home.
HACIENDA (2) A short form for the Costa Rican ‘Ministry of Finance’ – see Section B ‘Ministerio de Hacienda‘ definition for further info.
IMPUESTO (‘Tax’).
PACIFICO SUR (‘South Pacific’) Not Fiji or Vanuatu, but rather the Southern Pacific coast area of Costa Rica. There are various definitions for the extent of this region with most agreeing that it ENDS at the Osa Peninsula and Panamanian border – but some suggesting it STARTS at the city of Puntarenas while others narrow it down to a start in Dominical. But either way, the Pacifico Sur region includes the Costa Ballena.
PLANTEL A flat area, either prepared or natural, within a larger property or lot, where structures may be constructed and where construction is permitted as no setbacks violate the area. A lot may included one or more separate Plantels. Also see Section B ‘Setback‘ definition for further info.
PLANO (‘Plan’). Usually, but not always, refers to a property survey, known in Spanish as ‘Plano Catastrado’ – see Section B ‘Plano Catastrado‘ definition for further info.
PROPIEDAD See ‘Finca‘.
QUEBRADA A shallow ravine or gorge, either carrying a permanent or seasonal creek, or permanently dry. Often gives rise to ‘Setbacks” – see Section B ‘Setback‘ definition for further info.
(B) IMPORTANT THIRD PARTIES, DOCUMENTS, TERMS AND PROCESSES A real estate transaction involves a multitude of third parties, paperwork, reports, tests, requirements and processes including those that are very specific to Costa Rica. The list below lays out some of the more important considerations that may be encountered during a typical real estate transaction here.
ASADA Asociaciones administradoras de los Sistemas de Acueductos y Alcantarillados comunales. ‘Associations Managing Communal Aqueduct and Sewage Systems’. Local entities established to develop, maintain and operate drinking water and sewage systems where national (AYA) or municipal water services are not available. ASADA water services are metered and payable.
AYA Instituto Costarricense de Acueductos y Alcantarillados. ‘Costa Rica Institute of Aqueducts and Sewers’. Responsible for development, maintenance and operation of drinking water and sewage systems in Costa Rica.
CARTA DE DISPONIBILIDAD DE AGUA (CARTA DE AGUA) (‘water letter’) An official certification issued by AYA or ASADA which confirms the existence of adequate drinking water resources for a property. Usually valid for 1 year. No construction permits will be approved without a valid Carta de Agua. RE/MAX We Sell Paradise will assist in the acquisition of a Carta de Agua from AYA or ASADA, or will suggest professional assistance in the acquisition of a Water Concession from a creek, spring, well etc.
CATASTRO NATIONAL (‘National Registry’) A department within the Registro National which contains the Registro Inmobiliario (Real Estate Registry).
RECONSTRUCCION DE CATASTRO (‘Registered Plan (Plano Catastro) Reconstruction’) An option, offered through the Catastro National, to update the Plano Catastrado for omissions or inconsistencies.
CONCESSION LAND Land which forms a part of the Maritime Zone (see ‘Zona Maritima’) and can be leased from the Costa Rican government for a typical term of 5 to 20 years. The lease term can be renewed and usually a set of conditions must be adhered to by the lessee. If a lease is not renewed, an application process must be commenced from scratch.
ESCROW Funds or assets that are temporarily transferred to and held by a third party, usually a registered escrow company, are said to be ‘held in escrow’. This can increase the speed of real estate transaction settlement and help parties meet compliance with anti-money laundering laws. In real estate context property, cash, and titles are often held in escrow to facilitate transactions and provide security.
ESTUDIO DE SUELO (‘Soil Study’) An engineer’s report documenting physical and mechanical characteristics of the soil. Used for the appropriate design of structures and foundations.
LEGAL WATER An informal term used to denote that adequate drinking water access to a property is provided by a government entity and that this can be certified by a Carta de Agua.
MINAE El Ministerio de Ambiente y Energía. ‘The Ministry of Environment and Energy’. Government department responsible for the protection of the natural environment in Costa Rica. MINAE grants Water Concessions.
MINISTERIO DE HACIENDA ‘The Ministry of Finance’. Also known simply as ‘Hacienda’. Responsible for collecting tax revenue in Costa Rica including property taxes and luxury taxes.
PLANO CATASTRADO (‘Registered Plan’) An official property survey illustrating the location, size, and boundaries of a piece of land. This survey is registered with Catastro National.
REGISTRO INMOBILIARIO (‘Real Estate Registry’) A registry within the Catastro National where a Plano Catastrado can be obtained or updated.
REGISTRO NATIONAL (‘National Registry’) A database of corporate records, ownership and public titles to recordable assets such as real estate. Contains the Catastro National and Registro Inmobiliario.
SETBACK An area which legally cannot be disturbed and where either no construction or limited construction (for example retaining walls) may take place. Setbacks are associated with objects such as rivers, roads, quebradas, protected areas, Zona Maritima, springs and water sources (which are subject to large setbacks due to necessity of protecting drinking water). Setbacks can be significant, ranging from a few meters up to 200m in length, and many considerations go into specific setback arrangements.
USO DE SUELO (‘Land Use’) A certified Zoning Plan issued by a local municipality. It outlines certain restrictions such as maximum building height, maximum size of an area that can be built, the type of structure that can be build, etc.
WATER CERTIFICATE See Carta de Agua.
WATER CONCESSION A drinking water permit granted where no drinking water services are available from AYA or ASADA. A Water Concession is granted by MINAE and is usually valid for 10 years. Examples of Water Concession sources include artesian and perforated wells, rivers and streams, lakes, or natural springs. A property with a Water Concession will be required to onboard onto an ASADA or AYA if the infrastructure becomes available.
ZONA MARITIMA (‘Maritime Zone’) All land area starting at the average high tide line of the Pacific and Caribbean coasts and extending 200m inland, including mainland of Costa Rica as well as adjacent islands and islets, bays, mangroves, peninsulas, estuaries, etc. The first 50m of this land extending from the average high tide line is known as ‘public zone’ where no construction is permitted except in very certain circumstances and the remaining 150m can be applied for concession through the local municipality. Also see ‘Concession Land’.
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