BeachFront Homes

The difference between beach property and Maritime Zone Property

Not all beachfront property is maritime zone property. You can purchase fully titled land in front of the beach or overlooking the beach or within walking distance to the beach and never have to worry about the Maritime Zone.

However, if you want to purchase land on the beach, it will not be titled. As in nearly every country in the world, Costa Rica’s beaches are public property. So, if you would like build or buy a beachfront home or business, you should familiarize yourself with the special rules regarding beach property in Costa Rica.

Learn more about Concessions to the Maritime Zone to Beachfront Homes

Precautions Beach Home and Property

Although local government of Costa Rica will collect a beachfront land use tax known as a canon from occupants of land located in the maritime zone it does not mean that a concession has been granted. As such, the payment of a canon is simply recognition of the right to possession.

Here are other points of beachfront law you must abide by in order to safeguard your concession.

Concessions for maritime zone beach propertycannot be granted to:

Foreigners who have not been residents for five years
Companies with bearer shares
Foreign companies based abroad
A company set up in Costa Rica exclusively for foreigners.
A company with more than fifty percent foreign capital (Maritime Zone Art. 47)

Concessions on maritime zone beach property can be forfeited for the following reasons:

Failure to apply for an extension of a concession in a timely manner
The forfeiture of rights by the interested parties
The death or legal absence of the concession holder with no heir
Not abiding by the established obligations of Article 51
Cancellation of the concession (Maritime Zone Art. 52)

The ICT can cancel a concession on maritime zone beach property for:

Non payment of the yearly canon or royalty
Breach of contract (e.g. use of the land for purposes other than those expressly stated by ICT)
Violation of the ordinances of the law that grants the concession
Impediment of the use of the public right of way
Other causes that this law establishes (Maritime Zone Art. 53)

Besides, an investment in shoreline beachfront property regulated by the Maritime Zone Law requires extra caution and thorough investigation. The reality is that ambiguities exist within the written law, so that as regulations are created and amended, rights to property may also change. There are no guarantees and there is no foolproof way around the law. Even if you get a concession, there are no guarantees that the concessions will be renewed or that the price of the concession or the yearly canon will be within reason. The fact remains that you are not purchasing beachfront property, you are leasing it and you must be willing to accept that risk.

Beach Property Restrictions

There are certain restrictions for concessions of beachfront properties held by foreigners. If personally held, the foreigner must first have five years of legal residence in Costa Rica. For this reason, most foreigners purchase the rights to beach property by first forming a Costa Rican corporation, a simple process that takes about 30 days and can cost from $150 to $500. The cost depends upon your attorney and the characteristics of the corporation registered. Your Costa Rican corporation must have at least fifty percent of its shares held by a Costa Rican resident. Most people are not comfortable with this so at the time of closing the sale, the "token" Costa Rican shareholder, simply signs over their shares to the foreigner so that the foreigner is holding 100% of the shares. This is common practice.

Exceptions

The Maritime Zoning Law was not applied retroactively. Any shoreline beachfront property previously titled can be freely transferred. Of course this titled property is very rare. These cases are those involving rights registered in colonial times, and certain urban property on the beach. In areas near of 150 meters of restricted zone does not have an approved zoning plan (plan regulador), you may find an “arriendo”. You may occupy and develop the zone after you purchase the rights from the legal occupant. These rights are registered at the corresponding local government or municipality. There is no time limit for arriendos. Not until the beachfront land is property zoned (which may never happen!). Many beach lands have an arriendo. The arriendo allows transfer of ownership and low impact development. Building a house or small tourist project is no problem but larger projects must go through a zoning approval with the government

To finish, see information about squatters in Costa Rica, because in certain cases a foreigner has made it through the concession process only to lose all or a portion of the property later to squatters. Make sure your attorney examines the Municipality Records, verifies the seller's ownership status, and also verifies general tax and leasing records. Keep in mind that if you are opening a business on the beach, it may be worthwhile for you to have a concession. But if you are looking to purchase a beachfrotn home or recreational property, then you would probably be better advised to purchase titled land outside of the Maritime Zone.