Equity Loans in Costa Rica: Benefits, Process & Requirements Costa Rica has seen an increase…
All properties on the Costa Rican grid are supplied with water by either the national Asociaciones administradoras de los Sistemas de Acueductos y Alcantarillados comunales (ASADA) or the Costa Rican Institute of Acueductos y Alcantarillados (AyA).
All of Costa Rica’s water is owned by these two governmental bodies. Thus it seems to reason that there should be plenty of supply. As you may already be aware, that is only occasionally the case, particularly in the drought-prone region of Guanacaste. Despite being a tropical and humid country, Costa Rica can have water shortages, particularly during the dry season. Water consumption may be restricted during these droughts, and it’s even conceivable that your supply could be interrupted for a few hours of the day.
How does a “Water Letter” work in Costa Rica?
A water letter, or “Carta de Agua” as it is known locally, is a certification from AyA or the ASADA attesting to the existence of resources for drinking water on the property.
A land buyer should consider a variety of factors while evaluating properties. They should ensure that the lot has access to all required amenities, such as water, power, and internet if they want to develop it. However, because the water letter is necessary to obtain construction licenses in Costa Rica, land without one might as well be deemed a nature reserve, and you are unlikely to be able to develop anything anytime soon.
When you purchase your property, it could already have a water letter, but by the time you’re prepared to begin construction, you might have passed the deadline. Look closely at the dates on the water letter because they may not have much time remaining and may not be able to be renewed, delaying your building by months or even years. Usually, water letters are issued for six to twelve months. Building permissions must be obtained at this point to avoid wasting any time.
Here you will find a cautionary tale of a Costa Rican expat’s experience purchasing a lot in Guanacaste without a water letter.
What Role Do Gated Communities Play?
What happens if I buy a house in a gated community with a water system? Is that enough? Possibly, but you should always double-check. In the past 10 or 20 years, when apartment complexes in Costa Rica were divided, the developers would build roads, dig wells, and install power. The standard water, piped throughout the community, was accessible to anybody who bought a lot there. Unfortunately, as reported on by The Tico Times, a new law in Costa Rica modified the straightforward system on September 1, 2014. Since then, simply having water on your land is no longer sufficient. For a building permit to be obtained, you will need an active water letter. The new rule does not apply to existing construction already in progress, but for expanding after completion, you would need to request a new building permit and thus have an active water letter.
Is there a way to get around a water letter in Costa Rica?
The first option is to utilize a rainwater collecting system or a river or creek that runs through the property. If the water source is suitable for drinking and has a sufficient flow throughout the year, it can be registered and granted a water concession. This process will take a lot of patience and legal advice to complete this complicated process. Expect a 1-2 year procedure before you use this option to get a water concession on your property.
A hand-dug well is an additional choice. The maximum depth allowed is 21 meters, and it cannot be located closer than 15 meters to another well or structure. This option is limited to supporting a single residence. Still, it serves as a solid backup because it is perhaps the quickest and simplest method to obtain a water concession, though it could still take years.
One drawback for residents of Guanacaste is that because water is a precious resource there, the government typically rejects these alternate strategies. As a result, they are typically not even considered to be optional.
Before making a Costa Rica real estate purchase, always do your homework. To obtain your construction permits, a lot you want to build on requires a document from AyA or an ASADA certifying water availability in addition to a supply of safe drinking water. Furthermore, if you buy a property with a water concession, it is best to start building immediately before the period expires.
DO YOU NEED HELP FINANCING A HOME PURCHASE?
To fill out a loan request – Click HERE.
Looking for help obtaining Residency in Costa Rica? – Click HERE.
Looking to invest your money with up to 16% interest? – Click HERE.