Real Estate Purchasing Process in Columbia: Foreigners can freely purchase property in Columbia. All transfers of title on real estate as well as all infringements must be done by a public document. All taxes must be paid for the transfer to be legally effective. Any document of transfer or judicial decision about the property must be lodged with the real estate registry.
The following registration procedures are followed:
- Obtain a Certificate or Certificate Day Traditionin from the Registry Office regarding the history of the property for COP7,000.
- Your lawyer will study property titles, which take about 5 days to complete and cost COP1,113,000. A certificate must be obtained from the municipality certifying that all municipal taxes have been paid on the property.
- The notary prepares a public deed. The notary’s cooperation in the preparation of this public deed is necessary and its fees are 0.30% of the property value. The notary will also hold 1% of the transaction value from the seller as an advance payment applicable to income tax.
- The public deed must be registered with the Registry Office. Registry tax is paid. After registration, the new public deed is automatically sent to Cadastre’s office to register the change of ownership.
These procedures can be completed in about 14 days.
Here are some points about Real Estate Purchasing Process in Columbia:
Transaction cost table
The cost of a round trip transaction includes all the costs of purchasing and remodeling the property – attorneys ‘fees, notary fees, registration fees, taxes, agents’ fees, and more.
- Registration tax
The registration tax is usually about 1% of the value of the property. The customer is responsible to pay for the registration tax.
- Registration fee
The registration fee is generally about 0.50% of the value of the property.
- Local government tax
Local government taxes are usually around 1.05% and are divided equally between buyer and seller.
- Notary fee
Notary fees are usually around 0.30% of the value of the property. These costs are divided equally between buyer and seller.
- Real estate agent fee
The real estate agent’s fees are about 3% to 4% of the property’s value.
Why Invest in Columbia?
- The World Bank lists Columbia as the fifth country in the world to protect investors in 183 countries and Latin America in the world.
The Columbian investment climate is considered the most favorable for foreign investment. Columbia is one of the most open economies in Latin America in terms of the percentage of property ownership by foreigners. Except for broadcasting activities (limited to 40%), every sector is fully open to foreign capital participation. According to JPMorgan Investment Bank, Columbia’s country risk stands at 185 points.
- Columbia currently has approved 13 Free Trade Agreements (FTAs), signed another 2, and is negotiating another 5.
Through state-of-the-art global trade agreements, Columbia tries to provide a stable legal environment for national and foreign investment. It also seems to open up new export markets for national production, with advantageous access, stable and long-lasting. This has been done through international trade agreements, such as the Free Trade Agreement (FTA) and bilateral or multilateral investment treaties.
With this improved position of the country in an international setting, the investment climate in Columbia steadily improved, standing out as one of the best in Latin America (Doing Business, 2003–2012). The plan to include the country in a global context and build trust among potential foreign investors has made The Economist (2009) Intelligence Unit one of the world’s emerging economies and, therefore, an attractive sector. To welcome the flow of FDI.
- Columbia has the best infrastructure in the region.
There are 8 high draft ports for the Pacific and Atlantic that allow easy access to international markets. Columbia has nine ports, seven of them on the Caribbean coast: Guajira, Guajira, Santa Marta, Cianaga, Barranquilla, Cartagena, Golfo Mororillo, Uberland San Andres and two in the Pacific – Buvevantura y Tumo. It has 11 airports that provide easy access to international markings.
According to IMD’s World Competitiveness album, Columbia’s energetic infrastructure is listed as one of the best in the Region. For 2012, the target of national electric energy coverage, counting both urban and rural areas, is around 93%. Columbia is an exporter of energy, which assures sufficient internal energy to operate of great magnitude.
Columbia has 5 submarine cables that generate a bandwidth of over 550 Gbps. The main cities have 100% coverage of optical fiber.
- Columbia has the most competitive free enterprise zones in Latin America.
There are incentives such as income tax of 15% in free trade areas, exemption from customs duty, application of benefits derived from international commercial agreements with the possibility of participating in the local market.
The government is committed to the development of research and development: salary and training incentives and tax cuts account for 175% of the investment of companies for R&D projects. Income generated from innovative projects is not calculated for taxes, and the equipment required for these activities is exempt from VAT.
- Columbia’s location is ideal for business.
Columbia is in the middle of 5 time zones and shares its time zone with important business centers such as New York, Toronto, and Miami.
It is 3 hours by plane, 5 hours from Miami and 5 hours from New York, 5 hours from Mexico City, 5 hours from Santiago de Chile, and only 6 hours from Buenos Aires.
- Columbia has significant human resources.
With more than 47 million inhabitants, Columbia is the third most populous country in Latin America, the 24th population on the planet, and the second-largest Spanish-speaking population worldwide.
26 schools across the country have been contracted for the SAT “Reasoning Test” for admission to American universities. Additionally, 19 schools are offering diplomas from the International Baccalaureate Organization (IBO), a test that allows admission to the best universities in the world.
For those interested in the French education system, three Columbia schools are part of the curriculum.
- Columbia has a legal system to develop investment.
The International Institute for Management Development (IMD) classifies Columbia as the second Latin American country in terms of personal safety and adequate protection of private property.
During the 1990s, Columbia was characterized for widespread integration into the global economy, limited to the common Andean regime (Decision 24, 1970) and a treaty with Mexico in 1995 (G3, now G2). Nevertheless, during the 1990s, there has been a strong turn in the focus of its commercial policy to diversify its commercial partners and protect its foreign investment. According to the economic integration strategy expressed in the Constitution and its development plan, the objective is to consolidate Columbia as a one hundred percent credible and attractive country for the development of trade with foreign investment.
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