The first step to shopping for real estate in Nicaragua is to forget everything you know about the process back home… no matter where home may be.
Let me make one thing clear from the start. There are incredible bargains to be had buying property in Nicaragua. In fact, there is no other market in the Americas where insisting upon a 40% return on investment or better is reasonable. However, there are few similarities between the rules and regulations governing the real estate industries in North America or Europe, and Nicaragua. It’s because of this lack of similarities that foreign investors often get into trouble. There is a preconceived notion on the part of foreigners that the Nicaragua real estate industry is as carefully regulated as it is elsewhere, and it is this incorrect assumption that sets foreign investors up to be cheated. The only universal real estate investing rule that applies as equally in Nicaragua as it does anyway else is Caveat emptor, buyer beware.
Real Estate Brokers
Basically there’s no such thing in Nicaragua as a real estate brokerage that a Canadian, American or European would assume the term represents. There are real estate brokerage offices. Some even have familiar franchise names, but that’s where the similarity ends.
There is no mandated, formal training of real estate sales people, nor are there specific licensing requirements. Anyone can become a “realtor” by paying for a merchant license or incorporating a Nicaraguan company. I’m not suggesting this means “all” real estate sales people are incompetent or untrained… many are. In fact, there are a number of retired realtors who relocated to Nicaragua and maintain successful, upstanding businesses. However, there are many more who are not at all competent, and operate on the razor edge between honest business and outright fraud. Caveat emptor again!
There is no district or federal regulatory boards governing the real estate industry in place. Real estate sales are no more regulated than a vehicle sale transacted by a street vendor. Outright criminality is not ignored by authorities, but having the perpetrator jailed is unlikely to result in recovery of any money lost. The revenge should make a fleeced buyer feel better though. Nicaraguan jails exist to punish criminals, not rehabilitate, and they are Hell on Earth. Unfortunately though, most issues that can arise in a real estate transaction are considered civil matters by law enforcement and have to be treated as such. In short, whatever money you think you were cheated out of… consider it lost. Even with a judgment in the plaintiff’s favor, collecting money owed in a judgement rarely happens. So again, caveat emptor.