Buying an Agricultural Parcel

Are you considering the purchase of a real estate property without public road frontage, outside a condominium and accessed through an agrarian right of way easement? Are you planning on purchasing this kind of property for yourself or for a future subdivision and sale of independent lots? If you are not sure if the property of interest is an agrarian/agricultural parcel, make sure you ask about it and understand the particularities of such type of property.

On September 13th, 2020, modifications to the Subdivisions and Housing Development Control rules issued by the Costa Rican Housing Department INVU became enforceable in Costa Rica. The following are the main currently applicable conditions for agricultural parcels:

• According to the Law, an “agricultural”/ “agrarian” / “forest”/ “cattle” parcel is a lot or farm where one or more of these activities are developed, and its purposes is for forest conservation or to grow crops or animals. These parcels also include fallow lands, protection areas for rivers and creeks, and are the result of a planned subdivision of a bigger mother farm.
• Access to this type of lots or farms is normally through an easement (agrarian easement) that has a minimum width of 7 meters, has direct connection to the public road, and is duly recorded on the property titles of the lots benefited and affected by it.
• To authorize the approval of survey maps for this type of lots, the developer shall obtain an analysis of land use and land capacity prepared by a professional registered for such purposes with INTA (“Instituto Nacional de Innovación y Transferencia en Tecnología Agropecuaria”).
• The minimum area of each parcel shall be 5000m2 in rural areas and 7000m2 within the Great Metropolitan Area. As an exception, if the parcels have direct access to the public road, the lots may be as small as 900m2.
• The construction activities on this type of parcels have several limitations. The maximum coverage is of 25% of the total lot area, assigned as follows:
  o 10% of the area to one single family home of up to 300m2 of construction in total, distributed in 1 or up to 2 floors; houses for workers and any additional structures related to the agrotourism activities that will be developed on the lot.
  o The remaining area (additional 15% of the lot area) may be built with structures required for the farming activities, including storage, stables, barns, green houses, water treatment plants, water reservoirs, etc.

It is very important to take into consideration for already registered parcels in which no constructions have been done, that for the purposes of obtaining building permits, the corresponding municipalities will have to interpret how the above detailed regulations shall be applied, being that it is not clear what may be considered as structures related to “agrotourism”. This should be addressed in each case with the corresponding Municipality as the regulations do not include an express definition of agrotourism activities and/or authorized constructions or facilities.

We have discussed this specific matter with engineers working on different municipalities and they have concluded that in general terms the main objective should be to comply with the concept of agrarian use and/or agrotourism when a construction project on an agrarian parcel is filed for Municipal approval. It might be convenient to consider elements like a vegetable plot or garden, an area to grow fruit trees, develop permaculture, or any traditional crops normally grown on the area of interest, or even some activities related with cattle, horses, goats, hen, and/or any products related with them. As long as the project complies with the correct general concept some engineers have confirmed that they would not have an issue in approving construction plans for a main house including for example a pool which could be seen as a simple additional element of said main house as long as the coverage percentage is still being respected. The regulations do not expressly allow construction of pools hence this matter needs to be carefully checked and verified with the corresponding Municipality.

In addition to all the  above, it is very important to keep in mind that agrarian parcels as per the Law currently are not suitable to carry out commercial activities. Short-term rentals in Costa Rica have been classified as a commercial activity that should obtain its corresponding Municipal patent for operation hence short-term rentals may not be approved by a Municipality on an agrarian parcel. Short-term rentals are defined on the Costa Rican Law as those non-traditional lodging activities offered for a period of time longer than 24 hours and shorter than 1 calendar year. Throughout the years, the Municipalities around the Country haven`t necessarily enforced these restrictions but as the time goes by and short-term rentals get more regulated and supervised in the Country, many Municipalities have started to pay attention to these concepts and some of them are already rejecting the issuance of short-term rentals` patents on agrarian parcels.

If you need more information related to agrarian parcels in Costa Rica and their limitations, conditions, allowed uses, etc. please contact us and we will gladly assist you.

There is currently a project of Law at the Costa Rican Congress to give the owners of agrarian parcels the possibility of converting their parcels into a new concept called “Touristic Parcels” which will have broader allowed uses including those that correspond to tourism and lodging but still under low coverage and low impact parameters of development. Hopefully this project of Law will get approved and owners of agrarian parcels will be given this additional alternative if needed.

Alberto Sáenz & the Invicta Legal team.
Founding Partner
Contact me at: [email protected]
Read about our Law Firm at: http://www.Invicta.lega