What you should know if you want to invest in Nicaragua
Back in time, in 1980s, the Sandinistas confiscated properties, foreign owned included.
People say that these days the situation is much more stable and it’s less risky to own a beach property in Nicaragua.
I am still not confident it’s the most secure place I would put my money into, but I am not an aggressive investor either.
But if you are and consider buying your small piece of paradise in Nicaragua, these are the things you should know before doing it:
- There are no restrictions on foreigners buying, owning, or selling properties in Nicaragua
- Residency requirements: an income from outside of Nicaragua of at least $400 per month, and you must be over the age of 45
- Documents to ask before buying: A copy of the deed, the clear title form the public registry, and proof form the local municipality that property taxes have been paid to date. It’s highly recommended to retain an attorney to handle the purchase.
- Additional costs at the time of the purchase: The closing costs are between 2.5 and 3.5 percent of the purchase price and include a transfer tax of 1 per cent and the attorney fees.
- The real estate commission is usually 6 to 7 per cent and sometimes it’s paid by the seller; you have to ask and make sure who is going to pay it.
- Property taxes: 1 per cent of the value of the property paid each year for the previous year; if paid by March there is a 10 per cent discount.
- Title insurance: First American Title Insurance Company allows you to buy title insurance (available now to foreigners) in the U.S., Canada or the UK. Title insurance are important in case legal challenges do not work in your favor.
