Ever Popular Costa Rica Real Estate
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Costa Rica is a major tourist attraction for people from around the world but, primarily, the U.S. and Canada. Indeed, tourism accounts for nearly eight percent of its gross domestic product. This tiny country, only about the size of West Virginia, is world-famous for its warm, sun drenched beaches and beautiful tropical mountains and landscape. Though it encompasses only one tenth of one percent of the planet, it is home to an incredible diversity of plants and animals. In fact, nearly one of every five species of plants and animals on the globe is found here. There are more kinds of butterflies in this little place than on the entire African continent and nearly the same number of species of birds as in the continental United States. It is no wonder, then, that Costa Rica draws tourists like a magnet. This country, which has been a democracy since it cast off its Spanish conquerors, has acquired the status of a tourist hot spot in Central America. The boom in the tourism industry has contributed positively to the growth of Costa Rica real estate over the past decade.
The north and central Pacific coast, in particular, with its great weather and many attractions, has been the most popular area for tourists for a number of years. The need for developed property catering to the needs of the growing number of visitors has seen a sharp rise in prices of real estate there. Hotels, resorts, restaurants, bars, and places for daytime and nighttime fun have sprung up dramatically. This has led to an acute shortage of land in some places that has brought increased upward pressure on land prices.
Additionally, the massive influx of retirees and folks who choose 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, of course, but there are lots of investors from Canada and Western Europe. My belief is that these countries will soon be joined by China which has been increasing its presence in Costa Rica dramatically over the last few years. 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.
Costa Rica real estate has been, and continues to be, a good investment because the country has a very stable political system and a growing economy. Unlike Mexico, foreigners can own free title to land. The crime rate in Costa Rica remains low, though increasing, and human development indices are very high compared to other Central American countries. The tourist influx has also seen the country evolve to accommodate the international community. More and more international investors have come to the conclusion that Costa Rica is a great place to invest in real estate and their returns on investment have borne out that faith.
How has the 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, are listing beautiful properties at huge discounts. These are properties that were by American and European land prices good buys when made. Now they have become extraordinary opportunities.
However, many experts predict that the boom will resume in the coming years. Costa Rica will continue to draw tourists and retirees from America, Canada, and Europe. Savvy investors often pool their money to form real estate ventures with, up to now, assured returns. Indeed, many folks who invested in Costa Rica real estate a decade ago have seen their investment soar. To be sure, the economic woes in the States and Europe are felt here now but the price stagnation or decline is temporary and will form the basis of a great recovery.
Most investors and many folks buying second or retirement homes prefer the more developed Pacific coast. Prices have risen the most there due to the increased demand though some of the most developed there are temporarily witnessing some declines in prices. The Caribbean coast is not very developed yet and prices are often substantially lower than on the Pacific. Though most tourists head west, nearly 40% of the country lives in or around San Jose, the capitol city, and real estate prices there have not been significantly affected by the world's recession because available land is at a premium as more and more Ticos move from the country to the city.
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