What are the main steps in buying a property in Nicaragua?


What Are You Looking For?

The first step is always to identify exactly what you want to get out of your property purchase. Are you looking strictly for investment or do you intend to relocate to Nicaragua? What type and size of property are you looking for? Are you after a vacation home that you’ll rent out when you are not using it or are you looking for a retirement property?

Check out the San Juan Live Real Estate Marketplace for up to date listings and accurate location maps so that you can easily get in front of the best deals.


The Price Range

Before you can actually find a property, you are going to need to know in what price range to look. Prices on property in Nicaragua can vary considerably depending on proximity to the ocean, community amenities and the size of the property. In Nicaragua the majority of sales are completed as cash transactions and foreigners are generally not able to access financing from local banks. When establishing the price range of your search criteria, be sure to factor in estimates of the closing costs that the purchase will incur.


What Type of Neighborhood?

You now have a mental picture of what your property might look like, and you know how much you can spend. Those two factors help you determine a third important factor – what type of neighborhood you want to invest in. Examples of things to consider are amenities, proximity to services and local attractions, sense of community, visitor trends and future developments.  To help you with this, we’ve created a free guide to the most sought after neighborhoods on Nicaragua’s Pacific Coast.


Viewing Property in Nicaragua

At this point you will have a good idea of the type, size and location of the property you are interested in and are ready to embark on your actual property viewings.

Finding the right property is both an art and a science. It’s important to consider both the hard factors (making sure the numbers check out) as well as the softer, more intangible aspects of the deal.


Time to Make an Offer

You’ve found a property you want, and now you want to make an offer. There is no magic formula to follow but your goal is to purchase at, or ideally below, market value. Buying with a good level of discount means you are essentially securing equity on the purchase at the outset; but your offer also needs to meet the goals of the seller for the deal to progress.  Here are 6 useful negotiation strategies.


Negotiating the Contract of Sale

Once you have made an initial offer, the negotiations will likely continue in the form of one or more counter-offers. A successful negotiation results in the drafting of a Contract of Purchase and Sale. The contract should include:

  • A legal description of the property
  • The purchase price
  • The amount and timing of the deposit and where this will be held
  • Confirmation of how the closing costs will be allocated
  • The closing date
  • Any contingencies that need to be satisfied


Hiring an Attorney

One of the most important steps to take when buying property in Nicaragua is to hire a reputable lawyer. The attorney should be independent of the seller and paid by you to represent your interests. As the closing documents and title deed will be in Spanish, it’s very important to choose a bilingual attorney if Spanish is not your first language.

If you plan to be out of the country at the time of closing, your attorney will suggest leaving a power of attorney. The alternative is to make use of the Apostille process (in countries where this applies) or travel to Nicaragua to sign in person – both of which have time and cost implications.


Legal Due Diligence

The process of legal due diligence conducted by your attorney starts with a review of the contract of sale (which should be done prior to signing). This is followed with a review of the seller’s title deed (Escritura) and title history (Historia Registral) at the Public Registry to ensure that the conveyance of the title has been done according to the law and that there are no mortgages, liens or encumbrances – confirmed via a free of liens document (Libertad de Gravaman).

The lawyer will also check the status of taxes payments on the property (Solvencia Municipal) and review any additional terms and conditions of the contract of purchase and sale including Codes Covenants and Restrictions (CC&Rs) and Horizontal Property Regimes (HPR) for applicable properties. Your attorney should request a current survey to confirm the size and boundaries of the property.

As the closing date nears and once your attorney confirms that the title is clear, you will need to make sure your closing funds are available for transfer to the seller at the time of closing.

(For more on legal due diligence steps listen to this interview with Eduardo Cabrales Cuadra at Garcia & Bodan, that’s part of our Insider Tips Series)


Closing the Deal

Closing is where ownership of the property is legally transferred from the seller to the buyer. It is a formal meeting, usually held at the attorney’s office. At the meeting a new title deed (Escritura) showing the buyer as the new owner will be signed by both seller and buyer (or person with power of attorney for either party). The funds for the purchase of the property will be transferred to the seller.



Following the closing, your attorney should take the necessary steps to have the property registered at the Public Registry (Registro Público). The Cadastral Office or Catastro (which holds the land plans) will issue a certificate showing the change of owner in a particular property, or the creation of a new property by way of subdivision. The Tax Office (DGI) will then evaluate the property to come up with the ‘assessed value’.  The assessed value forms the basis against which property taxes are paid.

Once taxes are paid, your attorney must include all the paperwork obtained throughout the process into the Deed, and submit it to the Public Records for registration.


Congratulations on your purchase!

This article is part of our Free Insider Tips Series For Nicaragua
Real Estate Investors. Learn more about it and sign up here.