A new long awaited Coastal Law that clarifies how close to the beach properties can be built has been approved, much to the relief of the real estate sector.
Property investors, many of them from the US, had feared that a draconian new law would be introduced after the country’s Attorney General Hernan Estrada suspended approvals for any property to be built within 800 meters of the sea earlier this year while the new regulations were drawn up.
Before the temporary suspension developers could build up to 30 metres feet from a public beach. So most ocean front property that was on the market or under construction was well within the temporary restriction zone.
There were widespread fears that officials might opt to keep this restriction in place which would have major implications for unsold or partially built property.
But now after years of uncertainty and speculation the new Coastal Law establishes one clear set of rules and guarantees for land ownership and development along ocean, lake and lagoon shorelines. It supersedes a century-old tangle of previous legislation that was both unclear and contradictory.
The new law states that all oceanfront land within 50 meters of the high-tide line is public domain and cannot be built on in any form. The same goes for all land within five meters of the shorelines of lakes and lagoons. Rivers are excluded from the law.
Also much to relief of the real estate sector the law is not retroactive. That means all land legally acquired prior to the law will be respected, as will all pre-existing structures and permits for land use or development within the affected coastal zones.
Investors and developers had lobbied strongly on behalf of setting the area of public domain at 30 meters instead of 50. The private sector argued that the 50 meter mark is an arbitrary political determination that is unfounded in any technical studies or environmental arguments.
‘I feel like we can finally relax after five years of doubt,’ said Lucy Valenti, president of the National Tourism Chamber.
The clarification is expected to act as a stimulus to boost property development along Nicaragua’s Pacific coast, where an estimated $1 billion in tourism and residential development projects were put on standby in anticipation of the new law.
Even if half of those 140 projects now move forward, Valenti said, it would be a huge boost to the regional economy, creating employment and stimulating new investment and cash-flow in Nicaragua.
Interest in property investment in the country has surged recently mostly construction costs are still much less expensive than anywhere else in Central America. Building in Nicaragua is 20 to 30% cheaper than in Costa Rica or Panama.