The Legal Process of Buying a Property in Colombia

 As a foreigner, it is always beneficial to invest in Colombian real estate. The Colombian government understands and appreciates foreign investment. So, the country offers all possible facilities to make the entire process of buying a property in Colombia quite easier and stress-free. Whether you are a Colombian resident or a foreigner who wants to invest in Colombian real estate, the buying process is the same for all.

 

The only required document for the foreign investor is a valid passport and sufficient funds for the purchase. However, buying real estate in Colombia will give foreigners a residency permit. Also, based on the type and size of the property you are investing in, you can apply for a 1-year or 5-year visa.


buying property in Colombia

Certificate of Tradition and Liberty

 

Once you finalize the right property for your investment and you want to move further in the process of buying it, the very first step is to get the Certificate of Tradition and Liberty. The best way to make the process of buying property in Colombia is to take the help of a professional real estate lawyer. He/she will help you in buying your desired property with all legal formalities.

 

This certificate is important to acquire as it includes all the information about the property and the property’s history. It contains the record of ownership, everything about the mortgage details, any legal claim to the property if any, and anything that is related to the property.

 

The real estate lawyer will help you to verify this certificate and will also perform the due diligence check on the property. The local registry office will issue this certificate, and you have to pay $15,700 pesos to acquire it.

 

Pay Taxes and Fees

 

When you purchase a property in Colombia, it is important to check for unpaid taxes and fees. Buying real estate in Colombia involves paying some types of taxes and fees. So, before you buy any property, you need to make sure that the owner has no due left for outstanding taxes on the property. For this, you have to acquire two certificates from the property’s owner.

 

  • One certificate is ‘Tax Free Property Certificate’ or ‘Paz y Salvo Predial’. It shows that the owner has paid all the municipal taxes on the property.

  • The second is ‘Tax Free on Values Gained Property Certificate’, which is also known as ‘Paz y Salvo de Valorización’. It shows that the owner has paid all the taxes on the increased value of the property.

 

When you are purchasing real estate, you have to pay certain taxes and fees, which is something nearly 1.65% of the total value of the property. These include a 1.6% tax for the registration of the property, a 0.5% fee for the registration of the property, and a 0.15% fee for the notary of the property.

 

On the other hand, the seller of the property has to pay around 3.63% to $.79% of taxes and fees for the total value of the property. These include a 0.15% fee for the notary of the property and a 3-4% fee including the VAT of the total value of the property for the real estate agent.


buying property in Colombia

Sign the Public Deed

 

The last step for buying property in Colombia is to sign the Public Deed. This legal document will indicate that you are the new legal owner of the property. It is better to hire a lawyer for this document. Once you pay and sign the Public Deed, you will be officially registered at the Registry Office as the new owner of the property.

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