How to Convert Costa Rica Farms to Building Land
When looking for real estate in Costa Rica, it is very likely that you will run into properties under agricultural use.
This kind of property is registered as agricultural land (uso agricola) in the public registry (Registro Nacional de Costa Rica) and is almost always a lot cheaper than the land for building.
The overall question is whether it is possible to build on such a property.
The owners will surely tell you that this is always possible, while other people will tell you that it is never possible.
If you do your homework and research some important points, you might find a great investing opportunity in agricultural land.
It is very important to survey a property with agricultural use before making a buying decision.
Properties with this kind of use usually have an area of more than 5,000 square meters (1.23 acres) and normally do not have public services like electricity,
water, drainage, or phone lines on site.
It is recommended that you try to convert an agricultural land to a building one because of the great value this will add to the land.
The most important condition for adding value by converting use is an adjoining public road (calle publica), which is essential for a municipal water supply or for
water supplied by the public institution AyA (Instituto Costarricense de Acueductos y Alcantarillados), and for electric and phone lines from the utility monopoly
I.C.E. (Instituto Costaricense de Electricidad).
With a public road, municipal garbage collection can also reach the property.
If no public road adjoins the property, the new owner will have to provide a water supply (water pipes, well etc.) and a connection to public electricity, incurring
further costs for drilling, electrical towers, transformer, canalization etc.
If the property adjoins a public road and you need a building permit, the first step is to apply for public services and then to convert the agricultural land into a building one.
Building is also possible on agricultural land if the land is far from a public road.
If it has only a private road, but the costs for water installation and electricity are out of proportion, you can still build on the land, but only if the property has
a water spring.
If the property has a water spring, but also several water veins close-by, it is almost impossible to get a building permit.
However, even with these constraints, it is possible to get a building permit for only on a certain proportion of the total land area.
By this approach, you might succeed in getting a building permit, but you will not have the option of changing the land use in the future.
How to Subdivide Fincas
Agricultural land can be subdivided into smaller parts of minimum 5000 square meters (1.23 acres), even if there is no electricity, water, or a phone line on site.
Having a gravel road in place leading to the related farm, you can subdivide at this scale.
In order to subdivide into areas smaller than 5000 square meters, you can use the following recommendation.
To access the farm, you open a gravel road 14 meters wide and have a topographer elaborate and register a new plot map.
If access to water, electricity, and phone is subsequently installed by the local municipality, you donate the new plot map to the local municipality.
With this approach, even for agricultural land, you have good chances to be able to subdivide into areas smaller than 5000 square meters (1.23 acre) per lot.
Under no circumstances can the following types of agricultural land be subdivided:
- Forest protection
- National parks
- Agricultural land within a maritime zone
- Agricultural land declared to be of public interest
- Agricultural land affected by a public easement
(servidumbre publica), for example, high voltage
Should you be interested in properties in Costa Rica, don’t forget to take a look at my well selected properties, of which 90% have nice views and are located in nice neighborhoods.
Also check out the new farmland opportunity for sale in Hojancha (Guanacaste).
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