Long Term vs Short Term Rentals In Costa Rica
You are planning a trip to Costa Rica and not sure how the rental market works. You have heard from different people different rules, experiences and mishaps. The first thing you need to do is stop listening to everyone. You need to locate a property management company in the area where you would like to rent and that company will educate you about the advantages and disadvantages of renting either long or short term. At Costa Rica Vacation Realty we can assist you in this area.
Is there a difference between long and short term rental? What is a security deposit?
In Costa Rica, property for rent is governed by law No. 7527, "Ley General de Arrendamientos Urbanos y Suburbanos," or the "General Law of Urban and Suburban Renting." This law applies to all contracts, verbal or written leases of real property intended for housing, commercial, cultural, industrial, craft, professional, technical or recreational activities and public services.
Is there a difference between long and short term rental?
Yes, there is a difference between short-term and long term rental. Short term vacation rentals are excluded from law 7527, though that exclusion applies only to establishments registered as hotels, bed & breakfasts, hostels and vacation homes where stays are from one day up to 30 days. If you are reserving a vacation rental or For Rent by Owner, a security deposit will be required prior to entering the home. However, if you reserve a short term rental in a hotel or B&B, you will be required to provide a credit card in order to secure your reservation. If you are renting for less than six months, this is considered a short term rental.
Long term rental: By-Law No. 7527 indicates that renters have the right to stay in a property for up to three years. Although, Landlords enter into lease agreements for a shorter term such as one year; if the renter decides to stay longer than one year; his or her has the right to stay for an additional two years. If the term of the agreement expires (meaning a total of three years), it is automatically renewed for three more years, unless the landlord gives the renter three months' notice stating he/she will not renew the agreement.
What is a security deposit?
Once the renter and landlord have both signed the lease agreement, the renter will provide a security deposit, which equates to one month's rent. The security deposit will cover any damages to the rental property and, if the renter vacates the property prior to the expiry of the lease, the damage deposit will not be returned to the renter. Landlords will usually return the security deposit 30 days after the tenant has left, so utility bills and inventory can be checked. Also, if you have a pet, you will have to provide a separate pet deposit.