In 2006, if anyone asked about investing in Costa Rica real estate, one likely response would have been, “quit asking questions and buy!” In recent years, the same cannot be said. The housing market has suffered as a result of the US crash. However, murmurs of revitalization in the market are spreading, and the future for real estate within Costa Rica is poised to return to the prominence it once held.
Over the course of the past few years, there has been a steep decline in purchases of land and luxury homes. Almost all sales involving expensive estates have come at a discounted rate. Even so, such sales are few and far between, since the Costa Rica real estate market is known to be inelastic. In the past, bank financing for homes tended to be quite unfavorable, when it could even be found to begin with. Paying for homes in cash is very common here. With very little yearly holding costs and few bank loans to be repaid, most sellers are reluctant to lower their sale price to accommodate the decrease in demand.
However, recently financing with features similar to the US lending market has become available, which is great for the future of the market. To avoid crises in lending, strict policy has been implemented to allow banks a specific ratio of what they can lend in relation to their total reserves. This makes Costa Rica an even more accessible location to people looking to invest or relocate to a new country.
When the Liberia airport opened in the Guanacaste region in 2002, the northwest Pacific coast of Costa Rica became much easier to access, quickly developing into a hub for tourism and real estate. Nearly all international US airports have direct flights to San Jose, and the list of cities with direct flights to Liberia are compounding promptly – and for cities that don’t have direct flights, transfers in Miami, Houston, or southern California are just 3 hours from Costa Rica!
Though Guanacaste is a popular province for expatriates, it was one of the regions that took the hardest hits during the crash in the Costa Rica real estate market. Interestingly, the greater San José metropolitan area continued sales without interruption, which is attributed to its flexibility in options, accessibility, infrastructure, and mild climate. Plus, beach side and ocean view homes tend to be more expensive given the cost of land. Sales on homes around the $350,000 range have picked up recently, and developers have taken notice! Project Mar Vista on Guanacaste’s gold coast is preparing to offer ocean view home packages starting at $350,000, less than one mile away from the beach in an eco-friendly, gated community.
Overall, the Costa Rica real estate market is still in a recession. However, with the Central Valley selling in full stride, increases is access to financing, and the growth in the number of options on the market, the Costa Rica real estate is rapidly regrowing its liveliness.