Costa Rica is a Central American country with mile after mile of sandy beaches, volcanoes, and tropical mountains. With the Atlantic on one side, the Pacific on the west, and wonderful warm blue waters teeming with fish, it is an ideal vacationing spot. In fact, it is one of the most visited countries in Central America. Today it has a booming industry with many resorts, inexpensive hostels, hotels, golf courses, restaurants, casinos, pubs, and locales catering to adult activities. As it is being discovered, more and more Americans, Canadians, and Europeans have chosen to live there full or part time with thousands owning second homes along the spectacular beaches or tropical mountains. Foreigners can own property in Costa Rica and tens of thousands live here year-round because of its democratic government, tropical climate, reasonable land prices, and spectacular laid-back natural environment. All this in turn has led to an increase in Costa Rica real estate prices, particularly along the magnificent Pacific coast where most of the tourists go.
This relative scarcity of available real estate in the face of development growing out of tourism has led to a boom in the real estate business along the coasts, in the mountains, and in urban areas.
Additionally, the large numbers retirees and folks who have elected to live in a tropical paradise and leave behind the pressures of day-to-day life has also contributed to the increase in property prices in some coastal areas. Plenty of investment has been coming into real estate from outside the country. The U.S. has led the way, certainly, but there are lots of investors from Canada and Western Europe. China has been increasing its presence in Costa Rica dramatically over the last few years, as well and today there are thousands of Chinese who live there. In addition to beach-front property, the main areas of investment are farms, called fincas, which are being developed into subdivisions, mountain properties, and vacation rentals. Real estate prices have soared along the Pacific coast and some other parts of the country because expatriates and people wanting second homes have realized just how cheap, relative to the U.S. and Europe, land is.
A number of years ago, the country realized the benefits of sustainable development and tourism. Unlike many other countries, Costa Rica has learned the lesson that unregulated exploitation of resources is ultimately detrimental. Wisely, in the face of sometimes intense pressure, it refuses to allow oil exploration off its coasts. Tropical forests, once cut or burned for little farms, are returning. As more and more of the international community is encouraged to visit, investors from around the globe have found that Costa Rica is a wonderful real estate market. And, indeed, over the last decade there has been a real boom in development along the Pacific coast.
How has the recent worldwide economic downturn in the States and Europe impacted Costa Rica? Not surprisingly, subdivision and condominium development have dramatically slowed or even been put on hold, and in some parts along the Pacific coast American second-home buyers, now cash-strapped, have been selling beautiful properties at large price reductions. These are properties that were by American and European land prices good buys when made. Now they have become extraordinary opportunities.
Despite today’s uncertain economic climate in the States and Europe, the general perception is that there will be a large rebound in Costa Rica real estate. Why? One reason is the incessant flow of investments based upon the lucrative returns to be had from property development. Another is that, in comparison to the Unites States and Europe, real estate prices, particularly on sunny, tropical coastlines remain incredibly reasonable. Land prices along the coasts are still just a fraction of the cost elsewhere. Further, real estate investors have found extraordinary returns on their investments over the last decade.
The beach properties along the Pacific coast have seen, and will probably see, the largest increase in prices over time. The Caribbean coast remains relatively undeveloped. Certainly prices there, like all of Costa Rica, are rising but not nearly as much as on the other coast (which, of course, means that stress on prices have been less lately than on the Pacific side). And, as more and more Ticos move from the country into the big urban area around San Jose, available prime property has become increasingly scarce. Demand remains strong in the urban areas and, for more and more expats who live in Costa Rica, the amenities and climate around San Jose are proving irresistible.
The author, Victor Krumm, lives in spectacular Costa Rica and has an informative websiteCosta Rica Vacations. Check out the prettyCosta Rica Real Estate
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