Costa Rica Real Estate News San Jose, Costa Rica

New System Will Facilitate Research for the Costa Rica Property Buyer

Want to know if you’re getting a fair shake when you buy property in Costa Rica? It may soon be easier to compare property prices.

The Ministerio de la Hacienda (Finance Ministry) plans to assess and update values for all property nationwide.

Hacienda is looking to bring its “values platform” (a central listing of property values that hasn’t been revised for a decade) into the 21st century with the help of a specially contracted company to update property values and two others to update cadastres (the official records of property boundaries, features and values). The values platform is meant to aid municipalities in assessing property taxes.

Many Costa Rica landowners have until now been able to undervalue their properties. Some municipalities have found large, valuable properties registered for less than one American cent, although Hacienda estimates most properties are assessed at 20% to 25% of their actual value

The revaluation project aims to bring property values up to around 50% of market value, which would double property taxes for many landowners, but also provide cash-strapped local governments with double tax income.

The company contracted to update values, Roche Argentina, has begun the first phase of the project, aimed at revising values in “homogonous zones,” areas where price-per-square-meter varies little from one property to the next. It expects to finish this phase one early as April of 2008 and make property values accessible to the public via the Internet. The goal is to have the platform completely updated by 2009.

The revision of cadastres is expected to begin soon. More than 510,000 properties will be visited to make sure the actual properties match up with what is registered in each cadastre.

The end result of all this? Costa Rica Real Estate Property owners may soon be paying higher property taxes although don’t be too concerned as tax rates are still low in Costa Rica. The good news, though, is that having a searchable database and standardized price comparisons will facilitate research for potential buyers.