What They Are & Why You Should Care
There are many considerations when buying real estate in Costa Rica that might seem “foreign” to the investing expat…
One specific area of weirdness are the rules surrounding so-called “Agrarian Parcels.”
For starters, let’s say what they aren’t – say you have your sites on a particular piece of real estate that happens to be directly accessed by or fronting a public road. In that case, everything written below is not a concern for you – your targeted investment is NOT an agrarian parcel.
Agrarian parcels are basically created when a large “mother farm” is subdivided into smaller pieces. Some of those will be on the public road. These lots can be much smaller than the required agrarian parcel size (see below) and are generally not restricted in terms of what you can build on them. However, those interior lots not touching any public road must be given access through what in Costa Rica law is called a “servidumbre agricola”, or agriculture easement. These lots then become known as agrarian parcels and are potentially restricted as set forth below.
So, if you’re buying a lot in a rural area that is accessible via an easement, then the rules I am writing about are more than likely going to come into play. You should proceed with increased caution.
These agrarian rules were first promulgated many decades ago when Costa Rica was still predominantly an agriculture based economy. The rules were originally quite simple and stated basically that parcels could be no less than 5,000 m2 in size and usage for non-agriculture purposes (such as residential) was limited to 15% of the total area of the parcel. So, if you bought a lot of 5,000 m2 you could build a 750 m2 house on it. That’s a damn big house (over 8,000 f2)!
Well, as often the case, Costa Rica loves to complicate things, often more than really is necessary.
By the way, these rules are regulated by the Costa Rican government agency known as INVU (Instituto Nacional de Vivienda y Urbanismo). That’s the same agency that regulates the setbacks for rivers, creeks, and springs, which is a topic for another post.
Nowadays, the 15% limitation has been expanded to 25%, but is further limited as follows:
- Lots still are generally limited to 5,000 m2 in minimum size*
- Only 10% of the coverage can be for “residential” purposes
- And allowed within that 10% is the construction of a main home of not more than 300 m2 (3,229 f2)
- Plus other dwellings for “workers”
- Oh, and the other 15% for solely agriculturally related infrastructure and installations.
*Some municipalities, such as my own Perez Zeledon, have increased the minimum size of the agrarian lot to 10,000 m2.
Also, in general, if the municipality where your desired parcel is located is covered by a zoning plan, said zoning plan will take precedence. The way you find out about this is to order the “uso de suelo” for your lot. This is a document that will reveal any restrictions imposed for developing your property.
However, be careful here. I recently had a deal where the uso de suelo for an agrarian parcel did indicate that it was subject to a zoning plan. However, after addressing the issue directly with the muni, we learned that they would nevertheless impose the agrarian limitations! So, even if this document seems to leave you in the clear, best to check directly with the muni as to how they actually apply their zoning plan in practice.
Now these restrictions may or may not be a problem for you. It depends on your intended plans for development. If they do pose an impediment, there are some creative get arounds…
For starters, let’s say you’re buying an agrarian parcel that’s 30,000 m2 in total size (3 hectares). Let’s say for purposes of this hypo that the land is located in Perez Zeledon, where there is a minimize size of 10,000 m2 per agrarian lot. Let’s say you want to build more than a single main home of 300 m2.
Well, you could subdivide that 30,000 m2 parcels into 2 or 3 smaller parcels. Once subdivided the agrarian parcel restrictions would apply separately to each subdivided lot. Also, you would have to further create additional agricultural easements to ensure each subdivided lot has access to a public road.
There is also some leeway in interpretation of what “agrarian use” means. Munis have generally interpreted this loosely by allowing for the project to include a swimming pool as part of the 300 m2 for construction of the main home. In those areas where expat real estate activity is very active, usually you won’t find pushback against including a pool, as long as you’re basically complying with the spirit of the law and keeping things within the required size limitations.
Another area that could be interpreted loosely is that of ”worker’s houses.” Could that also include what would actually be intended as a guest house? Again, as long as you’re complying with the spirit of the law, probably yes. For instance, when submitting your plans to the muni for permits, your “guest house” could be labeled instead as a “caretakers” house. It probably wouldn’t hurt to throw in a green house and an area for cultivation of fruit trees as well.
While these agrarian parcel restrictions might seem a bit silly and outdated in today’s Costa Rica, they do serve the useful purpose of allowing Costa Rica to regulate development in a way that is consistent with Costa Rica’s general interest in sustainability. This is important in that it supports the prime reason millions want to come here, some just to experience the country as tourists, while others to actually live.
It was only back in the 1980’s when rampant clear cutting of forests to create pastures for cattle reduced Costa Rica’s total forest coverage to around 25%. After putting into place better laws relating to forest management and the cutting of trees, Costa Rica has managed to more than double it’s total forest coverage in the last few decades. Along with that, Costa Rica has been a model for sustainability throughout the word with practically all energy produced via renewable sources and over 25% of it’s total territory set aside for conservation.
These days Costa Rica is undergoing what could be described as an expat invasion and real estate developers, smelling blood in the water, are trying to grab as much land as possible to create more buying opportunities for expats, usually at prices the locals (or, “ticos”) can hardly ever hope to afford.
The agrarian laws, while they might seem to be a pain in the ass (believe me, they’ve killed a few of my deals!), are an important aspect of keeping Costa Rica green, clean, and pristine (as well as relatively affordable for its own people)!
