Buying Property with Unpermitted Construction

Unpermitted construction is pervasive in Costa Rica's existing property stock — not just in informal or lower-income neighborhoods, but across the full range of residential and commercial properties, including upscale gated communities, established residential developments, and properties that have been sold multiple times. Estimates suggest that a substantial percentage of existing properties have at least one unpermitted element. This is not a sign of deliberate bad faith in most cases — it reflects decades of informal construction culture, incomplete permit processes, and a system where enforcement has historically been reactive rather than proactive.

The most common pattern is incremental. A house was properly permitted and built, and then over the years additions were made informally: a terrace was enclosed to create a bedroom, a guest casita was added in the garden, a pool was built without the accompanying safety fencing permits, a second story was added to a single-story home. Each individual modification seemed minor. Collectively, the property may have several thousand square feet of unpermitted construction.

Critically, the title transfers clean through all of this. The Registro Nacional records ownership — it does not track whether structures on the property are permitted. A beautiful property with a clean, unencumbered title can still have significant unpermitted construction. The buyer who purchases without a permit history review and physical inspection discovers the problem only after closing, when it becomes their problem. PDC's property inspection service has identified unpermitted structures on properties at every price point in the Guanacaste market.

When you purchase a property in Costa Rica, you acquire legal responsibility for every structure on that property — regardless of when those structures were built, by whom, or whether they were disclosed. This is not a buyer-beware technicality — it is a fundamental principle of Costa Rican property law. The CFIA and municipal building authorities do not distinguish between "the previous owner built it" and "you built it." If the structure is on your property, you are responsible for its legal status.

Municipal inspections can be triggered by multiple mechanisms: a neighbor complaint, a routine periodic inspection, an inspection triggered by your own permit application for renovations or additions, or an inspection initiated by municipal authorities as part of a compliance program. When an inspection reveals an unpermitted structure, the municipal authority issues a written notification requiring the owner to either legalize the structure within a specified period (typically 30–90 days) or demolish it. This notice goes to the current owner — you — regardless of the prior history.

The inability to obtain an occupancy permit (permiso de funcionamiento) is another practical consequence of unpermitted construction. A property with significant unpermitted elements cannot receive occupancy certification, which affects its ability to be legally rented as a commercial accommodation, to obtain home insurance at standard terms, or to be refinanced through formal lending channels. These limitations can affect the property's value and utility even before any enforcement action occurs.

Legalization — known as regularización in the Costa Rican permit system — is the process of obtaining retroactive building permits for structures that were constructed without them. When it is available, it is the preferred resolution for unpermitted construction. The process involves engaging a CFIA-registered architect and/or structural engineer who will evaluate the existing structure, produce as-built drawings that accurately document what exists, submit those drawings to CFIA for technical review, and apply for retroactive building permits.

The key factor in legalization feasibility is whether the existing structure was actually built correctly to code — even if without permits. If the structure was properly constructed with adequate foundations, structural integrity, appropriate setbacks, and compliant with applicable building codes, legalization is primarily a documentation and fee process. CFIA reviews the as-built drawings, confirms technical compliance, and issues retroactive permits. The cost involves professional fees for the architect/engineer, CFIA submission fees, and any applicable municipal fees.

If the structure has technical code violations — structural deficiencies, insufficient setback compliance, inadequate foundations, or other issues — those deficiencies must be remediated before CFIA will issue retroactive permits. The remediation work is done first, then the as-built drawings are prepared and submitted showing the corrected construction. In some cases, discovering what remediation is required involves opening walls or exposing structural elements that are not accessible from the exterior — which can reveal more extensive problems than were apparent.

Not every unpermitted structure can be legalized. Some structures exist in locations or configurations that are fundamentally incompatible with the legal requirements — and no amount of documentation or fees can resolve the legal problem. Understanding when legalization is not available is as important as understanding when it is.

Structures built within required setback zones — within 15 meters of a river or stream bank, within the road setback distance, or within neighbor boundary setbacks — cannot be permitted regardless of their construction quality. The setback requirement exists as a matter of law, and a permit authorizing construction within the setback zone cannot legally be issued. Similarly, structures in the ZMT public zone (within 50 meters of the high-tide line) cannot be permitted under any circumstances.

Structures on land zoned for an incompatible use — a commercial structure on land zoned exclusively residential, a structure on agricultural land that doesn't qualify for agricultural exemption — cannot receive building permits without a change of land use, which may or may not be obtainable. Structures with fundamental structural safety problems that cannot be remediated at reasonable cost may also be effectively unlegalizable.

For any of these situations, demolition is the legal resolution. The cost of demolishing a structure — particularly a well-constructed pool, a casita with plumbing and electrical, or a multi-room addition — can be significant. Discovering this situation after purchase, when the buyer has already paid for the property at a value that reflected those structures' apparent value, is one of the most painful and costly surprises in Costa Rica real estate.

The verification process for unpermitted construction operates on two tracks: documentary and physical. Both are necessary — neither alone is sufficient.

On the documentary track, obtain the CFIA permit history report for the property's folio real number. This shows all registered building permits, the approved construction areas and descriptions, and any occupancy certifications issued. Review the approved plans (planos constructivos aprobados) that were submitted with the original permit application — these show what was approved to be built. If approved plans are not available directly from CFIA, the municipality may have copies on file.

On the physical track, a professional property inspection documents every structure on the property — their approximate dimensions, construction type, condition, and location relative to boundaries and setbacks. The inspector then compares the physical documentation against the approved plans to identify discrepancies. Structures that exist physically but are not reflected in the approved plans, areas that exceed the permitted construction area, and uses that don't match approved use descriptions are all indicators of potential unpermitted construction that require further investigation.

PDC's Home & Property Inspection service was designed specifically for this purpose. It combines the permit history review with a physical site inspection by a CFIA-registered professional who can identify discrepancies, assess the legal and structural implications of what is found, and provide a clear report to the buyer before closing. We have used this service to help buyers negotiate price reductions, require seller remediation as a condition of sale, or — in some cases — walk away from purchases that would have resulted in significant post-closing liability.