The Real Story Behind Corporate Taxes in Costa Rica

by Rod Martin

A few weeks ago, Costa Rica’s high court ruled that portions of the law introducing the tax on corporations were unconstitutional.  We continue to receive many questions from clients asking, “Do I have to pay the corporate tax for 2015?”  It’s a question that deserves a clear answer.

Investors and residents often buy property, automobiles, boats, and even businesses and put them in a Costa Rica corporation.  For those new to Costa Rica real estate, you cannot use your corporation (e.g., an LLC) from your home country.  It has to be a Costa Rican corporation.  For larger groups or multiple investors, the Sociedad Anonima (S.A.) may be a good choice as it requires two active officers, with at least one share each.  A Sociedad de Responsibilidad Limitada (S.R.L.) is an even easier option, as it only requires one shareholder although dividing shares among two officers is common.  Costa Rica also allows you to own property, as a foreigner, in your personal name.  Many people ask why bother owning anything in a corporation, and a few of the benefits are:

  • Limited liability; as the S.R.L. suggests, the shareholder are only liable for their share of debt or assets within the corporation.
  • Estate Planning; passing shares on to family members.
  • Income; taxes are paid as corporate income instead of personal income.

Ley 9024 (the Corporate Tax Initiative) was passed in 2011.  Many investors (especially developers) with multiple corporations were forced to make changes to their portfolios.

Each corporation can either be active, which means a business entity that is registered with the Hacienda de Tributacion (National Tax Department) or or inactive, which is simply a dormant corporation with no business or income tax component.  For active corporations, shareholders are required to pay an annual tax of 200,000 colones (approx. $380) and approximately 100,000 colones ($180) for inactive corporations.

The High Court Repeals the Corporate Tax

A few weeks ago, lawyers persuaded the High Court to rule that the tax was unjust for two main reasons.  In Costa Rica, when major changes are made to a bill passed by law makers, the changes have to be advertised in the official newspaper of Costa Rica, La Gaceta.  The second reason it was repealed was that large and small corporations pay the same amount.

Since over 30% of corporation shareholders already paid the 2015 tax, the high court decided their ruling will not go into effect until 2016.  Many lawyers believe this will give the legislature time to re-announce the corporate tax bill properly in La Gaceta before the fiscal year of 2016.

The bottom line is… Yes, you have to pay your corporate tax for 2015.  The longer you wait, the more interest you will have to pay.    If you have any questions about this topic and its tax implications, please contact your lawyer in Costa Rica.

 

 

 

 

How to Make your Vacation the Most!

The first thing that we want to do after we decide to finally take some time off our routine and go on vacation is: the right place to stay.

So, now that you have chosen Costa Rica as your destination, where do you want to stay?

This is probably the most important decision you will have to make before going away on your so well deserved vacation. You have to make sure you make the right one because if you choose badly it can turn your dream into a nightmare.

In the last few years a new way of hospitality has developed in Costa Rica, home vacation rentals. Instead of going with the traditional option and staying in a hotel, vacationists from all over the world choose everyday to come to enjoy our beautiful country and stay in a home.

The options? enough for every budget and taste. With an inventory of approximately 4,000 vacation homes, we can offer our visitors condos, beach luxury homes, and mountain retreats.

The most popular properties are those close to the beach, of course, who doesn´t want to enjoy perfect warm weather by the pool of a luxurious home with all the amenities at the tips of its fingers?

So, choose carefully, make sure you look at many options and pick the one that you are confident with. There are many companies and people working in this business that know what they are doing. Use their knowledge and expertise to help you make the right choice. Once you have taken this step let yourself enjoy, we are waiting for you!

 

 

2014: A Year in Review

by Rod Martin


Costa Rica faced many new events, both inside and outside of the real estate realm in 2014. The country elected a member of the new political “party of the people”, Luis Guillermo Solís to presidential office. The entire country celebrated as the national fútbol team reached the Quarter Finals in the World Cup. And the real estate market finally showed hopeful signs of life due to foreign investment.

Then & Now

The coastal real estate ‘boom’ was just beginning in 2002. Tamarindo was still a small, sleepy beach town, and the Costal Ballena in the southern zone wasn’t even on most travelers’ radar. Manuel Antonio was as far south as most people ventured, mostly due to terrible roads and infrastructure. Even today, anyone looking for all inclusive resorts and sky-rise condos stick to the northern Pacific area of Costa Rica.

As the popularity of Costa Rica grew, home and land prices did as well. Unfortunately a downturn was just a few years away, and sellers chased the prices downward for about five years. Properties sat on the market for years – some are still there waiting for the prices to bounce back up.

Raw land prices are still off by about 50% from the peak in 2008. This is great news for buyers looking to invest in an ideal piece of paradise. There may be a slight uptick in List Price, but the main difference we’ve noticed is that most sellers aren’t taking 20%+ off their list price. Sales price averaged 13% off list price, and that number dropped to 12% in 2014. We expect it to move toward 11% in 2015 and here is why…

Clearing the Clutter

Many of the big ocean view properties have sold. This is due to two main factors including increased US investor interest and Costa Rica publicity. This small country has been featured in a number of magazines, travel channels, publications, and blogs in the last year.

This growing activity means a lot of properties have sold, but there are still plenty of great deals on the market at a variety of price points:  High Ridge Ocean View with No Restrictions for $199,000, and River Runs Through It  just reduced to $299,888… to name a few.

Houses, especially those with modern architecture and contemporary design have been the hottest commodity in Costa Rica. Many investors do not want to deal with the stress and uncertainty of building in a foreign country, and there are a number of beautiful homes that could be used for vacation or rental purposes. While expectations and timelines may have to be adjusted for construction in Costa Rica, there are plenty of talented architects, engineers, and construction managers that are available to build your dream home. As people become more uncertain about ‘first world’ living, we have seen many people from all walks of life, with a wide range of budgets, invest in raw land with the idea of building slowly and steadily in the coming years – securing a place to escape if things really turn bad up north.

Because of the factors mentioned above including foreign investment, Costa Rican publicity, and the challenges that many countries (specifically the US) have been facing, we believe the real estate market will continue to grow, albeit slow and steady. The Costa Ballena in the southern zone looks to be a sought after region, although the National Parks, lack of an international airport, and slow paced way of life should preserve the area, including waters, forests, and wildlife, for many years to come.

The Future

We are excited for whatever 2015 brings – it’s hard not to be excited when you’re living in pura vida paradise!

 

 

 

Friendship Makes Life Easier, and Also Makes Us Happier.

by Aliuska Sanchez

“Without friends no one would want to live, though possessed all other goods [...]; because what good is this kind of prosperity if it is deprived of the power to do good, to be preferentially exerted and more praiseworthy manner regarding friends? ”
Aristotle, Nicomachean Ethics

Friendship makes life easier, as said by Aristotle, and also makes us happier. The data was provided by Burt years ago with his study of friendship and correlation with happiness. When a person claimed to have five or six friends to share their problems had a 60% greater chance of saying that he/she was very happy. Therefore, the art of cultivating friends is one of the skills that although is not always teach to helps us to face difficulties and savor the moments shared.

Friendships also rescue us from corrosive loneliness, and makes us live longer and better quality of life. Is estimated that a quarter of Asian people say they feel alone. This is the conclusion of a study by the Australian Flinders University. For 10 years they analyzed the social relations of 1,477 people over 70 years old and it was correlated with longevity. The conclusion is very revealing: those with more and better relationships with friends, not with family, came to have a better chance to survive. Therefore, friendship is also an elixir of youth.

But beware, friendship is an art and an experience that relies on generosity and to look at the other person with kind eyes. Friends care for us and protect us even our own criticisms. Why do we call friends when we are feeling down? Because they are the ones that can connect with the kind side of us that even we forget about ourselves. This doesn’t mean that friend won’t confront us or will always agree with us. Otherwise, it isn’t a true friend. As Josep Pla said, in life “there are friends, acquaintances, and people we say hi to”. With friends you we show our true selves with no fear of being judged, and with acquaintances we share superficial conversations, though of course sometimes necessary.

Friendship doesn’t get eroded over time. We can reconnect with an old friend after years of not having any contact. That’s the magic of friendship. It‘s woven of threads that gives meaning to our lives.

Recipes

Take the Burt test: With how many friends can you share an important problem? If they are more than six, you’re probably a happy person.

Check your calendar and think of how much time you spend with your friends. If you think it’s insufficient make plans to be closer to them.

Surprise a friend with something nice: a gift, a phone call, a visit … this will make you feel good.

 

Properties in Costa Rica Monthly Spotlight: Uvita de Osa

The small coastal town of Uvita de Osa receives this month`s spotlight because it rests at the center of the desirable Costa Ballena and the amenities it provides have made it a vital part of day to day life in the area.

Uvita (meaning “Little Grape”) is home to the Marino Ballena National Park, which was established in 1989 and is known for its famous Whale`s Tail sandbar formation and the yearly migration of Humpback Whales. Over the decades, development of Uvita has been slow, allowing it to become part of a biologically diverse wildlife corridor and maintain an authentic Costa Rican appeal. Today it has grown to become the commercial center for a 30km stretch of coastline, with well established businesses which provide reputable services to its residents.

What Kind of Services Can Be Found in Uvita?

The banking options found within Uvita are a big factor which make this small town the center of day to day living in the area, these include the Banco Nacional, the BCR (Bank of Costa Rica) and the Coopealianza. As well, the quality medical care, provided at the two private medical clinics, the two dental clinics and the two pharmacies, is very important since the nearest hospital is located in Cortes, 30 km away. The local veterinary clinic provides full care services (including x-ray) for Fido, feline or feathered friend.

In Uvita you will find reputable lawyers, accountants, home builders and landscapers. Important products are sold at the pool supply stores, the paint store, the hardware stores, the auto parts store, and the home appliance stores. Important services are provided by the local print shop, the glass company, the electrical shops and the long standing Uvita Information Center, with tour/accommodation bookings and mailbox services. The two family owned BM supermarkets provide you with all the edible necessities one may need. Not to be missed is the Saturday Farmers Market, with organic produce, baked goods, whole food products, handcrafted jewelry and artisan crafts.

Uvita is home to a number of dining options, with some being long time favorites of visitors and residents, like The Dome Drive Thru, Restaurante Marino Ballena and La Fogata. One will also find fresh bakeries and a number of local sodas serving delicious typical Costa Rican dishes.

Natural Attractions and Community Initiatives

Enjoying the natural attractions, like walking the Whale’s Tail at low tide, offer unique experiences which you won’t find anywhere else. The beauty of the surrounding rainforest and Marine Park are enjoyed by way of the renowned ATV, horseback riding, hiking, diving and boating tours. Surf lessons are provided by experienced instructors and the surf is primed for beginner to intermediate surfers. Yoga studios feature classes for all levels, as well as certification courses. The Whales and Dolphins Festival in September features special tours to observe the yearly migration of female Humpback Whales, whom travel to the area to birth their calves. Uvita has played host to the Envision Festival since 2012, this international music and art festival draws thousands of visitors and highlights the raw beauty of the area.

The mix of locals and expatriates within and surrounding Uvita have developed a mutual appreciation for the town and the natural beauty of the area, in such a way that local initiatives to better the community are constantly evolving. Take for example Pueblo Alegre, a collaboration between residents and business owners to “paint the town” and work to make Bahia Ballena and Uvita an enjoyable sight for all. Volunteer organizations like Domestic Animal Welfare Group (DAWG), continue to make a positive impact on the community, while fundraisers regularly bring people together for a variety of causes.

People from all over the world have relocated to the Costa Ballena and no doubt they would all agree that Uvita plays an integral role in their day to day living. The surrounding mountain ranges are full of waterfall and river properties, quiet communities and stunning views of the Whale’s tail. For anyone looking for an active but simple lifestyle, with easy access to daily services and enjoyment of pristine natural surroundings, there are affordable options in the Uvita area. Perhaps most interesting of all about purchasing in Uvita, one does not necessarily need to pay the price for an Ocean view when you have a wildlife corridor in your backyard and a marine park only minutes from your home.

All in all Uvita offers a package that provides everything one may need for a comfortable lifestyle, wrapped up in the beauty of the rainforest and a protected coastline. So if you are looking to “get away” and “slow down”, but don’t want to be too far away from civilization, check out the coastal town of Uvita!

Drought-Free Water Supply in Costa Rica

Written by Rod Martin

Water… it is a subject that’s on everyone’s mind these days. Reports of drought continue to make headlines around the world. Large sectors of the China, Brazil, the Baltic region in Europe, and the western part of the United States are experiencing water rationing, 10-fold increases in monthly water bills, increased threat of wild fire, and significant impact on commercial agriculture among other issues. In addition, studies continue to reveal the harmful effects of chlorinated drinking water consumption.

Whether water is scarce in the area you live or your tap water tastes like a chemical cocktail, the southern Pacific zone of Costa Rica is increasingly attractive to people looking for a long term solution to their clean water needs.

Move Over Ocean View

The #1 property feature investors desire when coming to the Costa Ballena, a 30-mile stretch of jungle-covered mountains and idyllic beaches, is still the ocean view. However, as issues surrounding water gain significance, clean water continues to climb in importance. The good news is there are gorgeous properties for sale on the Costa Ballena that have both!

Dominicalito Villas is a fine example of houses with quality craftsmanship, fine finishes, and a nice ocean view. It also has a professionally installed well with a concession (legal right to pull the water from the ground). The owners do not add chlorine and they drink from the tap without any issues. The well is tested every six months, and the results always come back “clean and drinkable”. And do not fret if your budget is smaller, there are a number of houses and lots on the Costa Ballena with a well or a spring as the water source.

Springs To Life

Speaking of springs, many of our buyers are looking for a larger piece of land with rivers, creeks, and springs on the property. These investors often want to build a wellness or eco-retreat/hotel with trails to a river or waterfall, or a family compound with room for gardening or even sustainable food production. River Runs Through It is a great option in the hills of Uvita. As the name suggests, there is a river running through the property, as well as a natural spring. This 12.6-acre property also has community water provided from high flowing springs a few kilometers up the valley.

If you want the granddaddy of water properties in the southern Pacific zone, the 1,400-acre Private Eco-Park, just 15 minutes outside of Quepos, is it. It is a wonderland of rolling hills for gardening and orchards, lush primary jungle, improved trails, and hanging bridges that meander over pristine rivers, creeks and springs. The source water has been tested at “Evian quality” levels, and it highlights this stunning conservation property.

Conclusion: Costa Rica + Water = Your New Life

As local and global populations increase and climate change continues to adversely effect our lives, there’s no question that water is becoming more and more of a global issue. Luckily, there is a hidden gem known as the Costa Ballena, and it contains a variety of properties for sale with abundant, clean water sources.

 

 

Costa Rica is Brimming with Pride for its Soccer Team

If you were anywhere in Costa Rica on Tuesday following the 0-0 tie against England that consolidated Costa Rica’s place at the top of Group D, you know that Ticos are bursting with pride for its national team. Throughout the streets, people were cheering, horns were blaring and total strangers were hugging; stores ran out beer and bars were packed with celebration. It seems the “underdogs” are taking the World Cup by storm.

Costa Rica’s story has not only defied the odds, but has also brought global attention to the country, and the attention is not just on its success in soccer. One example is the Costa Rica promotional video that airs before the games and which has received very positive global feedback, especially on social networks. The video shows Costa Rica’s natural beauty and positions it as an ideal place for relaxation and tourism. It also shows diversity in industries and the people of the nation and their passion, making the video excellent vehicle for promoting investment opportunities.

People more than ever recognized the name Costa Rica. President Solis has said, “[people] start to look it up on the internet, see the spheres, the fact that we don’t have any army, that we have a strong democracy; I think the culmination of all this will be a help to us.”

Bloomberg, the premier business and financial market news outlet, has recently aired an interview with Costa Rica’s Ambassador to the U.K., Pilar Saborio de Rocafort. The subject for discussion wasn’t just the incredible World Cup matches, but also the rewards of doing business in Costa Rica. The interview sheds light on how economically diversified Costa Rica has become. Thirty years ago, commodities such as coffee and fruit were 50% of Costa Rica’s export. Today, that number is only about 10%. This expansion and diversification translates to more diverse opportunities for investors.

Throughout Costa Rica, it’s clear what the national team’s achievements mean to its people. The country is brimming with pride for its soccer team. It gives the nation the feeling that anything could happen. It’s this kind of spirit that draws people to Costa Rica and as the world learns more about Costa Rica and it’s people, as we learned this World Cup, the possibilities are limitless.

 

 

It’s Mango Season Guanacaste!

Costa Rica is abundant in natural fruit and vegetables. But many of the trees only bear fruit once the Costa Rican summer is over and the green season has begun. Beginning March and April and peaking May and June you will find Mangos all over Guanacaste. During this time mangos are everywhere, you can pick ripe juicy mangos right off the ground as you go about your day. It’s the perfect opportunity to do as the monkeys do and enjoy a delicious mango! Eat the juicy ones over the sink our stand outside on your balcony overlooking the ocean as you peal away the skin of ripe mango.

Need inspiration on what to do with all those mangos? Keep it simple and raw. Blend the mangos with some ice and milk, water or yogurt and create delicious smoothies. Pour the mix into an ice cream maker or ice pop tray and you have a delicious frozen treat. If you’re in the mood for something more savory cut the mango into squares, do the same to an Avocado or two (also in season now), add some black beans, season with olive oil, lime juice, salt and pepper and you have a delicious fresh, seasonal salad!

Happy eating!

 

 

 

Fiesta Sabanera at Hacienda Pinilla

Join us at beautiful Hacienda Pinilla on Thursday, April 17th for the Fiesta Sabanera where you can enjoy a colorful display of local horsemanship, music and dance!

The Fiesta is perfect for horse aficionados and anyone interested in learning more about Costa Rica’s cultural roots. The celebration will take place at Hacienda Pinilla’s equestrian center.  The Center has more than 40 horses available for tours throughout the area.

It also has an equestrian school and riding ring for visitors.  Even if you are not a horse rider, this is a great experience to view the beauty of these four-legged creatures and learn more about this aspect of Costa Rican Culture.

Date:  April 17
Time:  4 p.m.
Place:  Equestrian Center Hacienda Pinilla
Cost:  $10 admission; Free for children under 12

The Day of Happiness

Today, March 20th,has been designated the United Nations International Day of Happiness. According to the founder of Action for Happiness, “Happiness means feeling good about our lives and wanting to go on feeling that way.  Unhappiness means feeling bad and wanting things to change.”

Costa Rica has been ranked the happiest country on earth for several years in a row. What better day than today to explore what makes Costa Ricans so happy and what factors in general have the ability to make people happier.

Costa Rica is a country with beautiful ocean vistas and incredible biodiversity.  It has been an ecological pioneer, aiming to create a small ecological footprint.  Costa Rican’s have the joy of exploring gorgeous beaches on both sides of the country, and possess the ability to step outside their door to gaze upon beautiful mountain vistas.  Their emphasis on preserving this natural beauty has also boosted its economy, creating more jobs and opportunities.  And with no standing army, more money has been redirected to education (Costa Rica has a 96% literacy rate, the highest of any Latin American country).  Costa Ricans also find joy in the company of friends and family, placing a strong emphasis on loved ones over social capital and financial gains. Perhaps it’s these factors that contribute to Costa Rica’s unofficial slogan, Pura Vida, pure life.

We all want to live happy, fulfilling lives and want the same for our loved ones.  Many different factors can influence happiness:  genes and upbringing, external circumstances, but we can also influence our own happiness by our own choices, personal values and our sense of purpose.   Some people think that success is the key to happiness.  But recent psychological studies show that this is not the case.  Instead, its said that happiness fuels success, rather than the other way around.  When we are positive we become motivated, creative and productive.

One form of the success many people seek is financial. The idea that money can’t buy happiness has been around a long time, but that’s not to say there is no connection between income and happiness.  People with a comfortable living standard are happier than people living in poverty. “Comfortable standard” varies across countries. However, once we reach that standard, anything beyond that does not bring additional happiness.  Buying more things for ourselves- fancy cars or designer clothing, are not effective in turning money into happiness.   Instead, studies show that if you spend on yourself, you should buy experiences, not things.  An evening out with friends, a family trip to the beach will apparently make you happier in the long run than a new designer watch.   Also, the study shows, we should focus on buying for others.  This means indulging less in ourselves and giving others the opportunity to indulge.

Below we have outlined the Action for Happiness 10 keys to happier living. While in Costa Rica we are the happiest people in the world there is always room for growth and ways to make our lives and the lives of others a little sweeter.

Action for Happiness 10 keys to happier living

  • Do things for others
  • Connect with people
  • Take care of your body
  • Notice the world around you
  • Keep learning new things
  • Have goals to look forward to
  • Find ways to bounce back
  • Take a positive approach
  • Be comfortable with who you are
  • Be part of something bigger

A New International Airport in Quepos, Costa Rica?

by Rod Martin

For nearly a decade, there has been a lot of speculation about the new airport in the southern Pacific zone of Costa Rica.  The location (Palmar, Sierpe, somewhere closer to the Panama border) of the airport has changed a few times.  The optimistic timeline for “now open” status has been delayed over and over.  The fact is… nobody knows when it’s going to open or where.

This last point has been highlighted after the recent article in Costa Rica’s #1 newspaper, La Nacion, “Comienza Ampliación de Aeropuerto de Quepos” (Expansion of the Quepos Airport To Begin”).

The Civil Aviation Technical Council (CTAC) has begun the process of enlarging the Managua Regional Airport.  According to the director of Civil Aviation, Álvaro Vargas, the expansion will enable the terminal to receive larger national and international aircraft.

The “international aircraft” point is potentially big news for the area.  The Quepos airport currently receives around 15 regional flights and approximately 240 passengers per day.  Improvements will include extending the runway, construction of a terminal for passengers, a fire station, a hangar for aircraft maintenance, and additional parking among other minor changes.

Álvaro Vargas went on to say that the initial work on the runway expansion will be completed in 2015, and “the approximate cost of the purchase of land to extend the runway and make new improvements is $5 million.”

What does it mean for Quepos and the Southern Pacific Zone?

The economic impact will be felt by Quepos sectors like—hotels, restaurants, car rental, tour companies, and real estate—immediately.  More visitors will likely mean a boost to an already strong Manuel Antonio real estate market, which includes the Pez Vela Marina and luxury homes like this, Beachfront Indonesian Estate and exceptional larger parcels, like this Protected Eco-Reserve in Parrita.

The effect on the Costa Ballena, roughly the coastal area between Dominical and Ojochal, will be substantial, as well.  Now that the Coastal Highway is complete, the trip from Quepos to Dominical is a quick 30 minutes.  The Costa Ballena is highlighted by gorgeous beaches and waterfalls, majestic mountains, and ocean view property.

At the time of this article’s release, there has been no word on how the proposed international airport in the Palmar/Sierpe area will be affected.  News of the expansion of the Quepos Airport could delay, or possible spur on, the construction of this new international airport.

Either way, news of the Quepos airport expanding to eventually accept international flights has the southern zone buzzing.

Valentine’s Day in Costa Rica

Valentine’s Day has arrived!  Which means it’s time to celebrate the people we hold dear to our hearts.  In Costa Rica Valentine’s day is actually called “El Dia Del Amor y la Amistad” (love and friendship day).  All across Costa Rica today people express their appreciation not just for their spouse or partner but also for their friends, family, colleagues and even clients.  In fact, today, Costa Ricans will send ten million text messages to their friends and loved ones.   In a country of only approximately 4.5 million people, that’s a lot of love!

No matter who you’re thinking of on a day like today, what better way to express your love than taking a stroll on the beach with a close friend or spouse, catching the waves with your son, chasing your newly active toddler across the sand, kicking back with a beer and a buddy, or having girl talk by the pool… all topped off with a gorgeous sunset at the end of the day.

If romantic love is what you have in mind, Costa Rica is the perfect backdrop to kick-start your life as a couple with a romantic proposal! Click here and here for some beautiful images from proposals in Costa Rica.  Perhaps you’ll find your inspiration!

We have many amazing properties that could provide the perfect location for a beautiful getaway whether it be to show your appreciation for family and loved ones or plan that perfect proposal!  Click here or view our galleries and find the perfect property to make some memories filled with love.

Feliz Dia Del Amor y la Amistad to all our friends from Properties in Costa Rica

 

 

 

Year In Review – 2013

by Rod Martin

The end of another year.  Time for gratitude and reflection, both personal and professional.  In terms of business, it allows us to chart this Costa Rica real estate market we deal with on a daily basis.

After 5 years of trickling activity and decreasing property values, the “high season” (roughly the end of November thru March) saw an uptick.  The big question on our minds this time last year was “will it continue throughout the year or will the market be slow until next “high season”.  The answer… was resoundingly positive.

Sales are up

As you can see in the graphic (A1), the year over year increase in sales (think- buying) was 15%.  Market movement/growth was basically flat lined for the previous 4+ years, so this upturn was encouraging news.  The overall market is improving, but let’s look a little closer at the internal market dynamics.

Home sales led all categories on the Costa Ballena, a gorgeous stretch of coastline in the southern Pacific zone of Costa Rica.  Not only was the number of sold houses impressive, but two luxury estates over $2,000,000 sold, as well.  Although less than 50% of these new owners are relocating after their purchase, over 50% are smartly using it to generate revenue.  The vacation rental market is very strong on the Pacific Coast.  People want turn-key options, and this is not limited to affordable villas and luxury estates.

Six hotels sold on the Costa Ballena in 2013.  These ranged from low budget hotels to those valued at over one million dollars.  Like the vacation rental market, profitable hotels allow people a way to pay bills and, in some cases, start a new life!

I believe this is the first year that turn-key options (houses and hotels) have out numbered raw land sales, if only by one or two.  One trend we often see is when house hunters can’t find the right home, they buy and build it!  This is a smart strategy since you have the freedom of choice for location and design of the home.

More good news for buyers

Like the sunsets, the news just keeps getting better and, in fact, it’s two-fold.  First, many home owners who have been sitting on the sideline now see the market picking up and are listing their houses with us.   More listings = better selection.  Second, property values are still low.  As with any real estate market, there is a time delay between uptick in sales and stronger property values.

Purchase price vs. List price

As reflected in the second graphic (A2), many sellers are negotiable on their list price.  The average sale price is 13% lower than the list price.  Obviously, this varies depending on the sellers, their motivation, and fiscal elements like “all cash” or financing.  As the market gets stronger, that percentage will disappear like the setting Sun over the Pacific.

The 2014 “high season” has already produced a lot of activity, and it’s no surprise.  Fantastic properties at good prices… come take a look today!

 

 

Find Great Value in the Southern Zone

Costa Rica’s Southern Zone has been drawing a lot of attention recently. This is hardly a surprise considering its natural beauty is unparalleled and prices of property are very much within reach. International Living Magazine says this is the place where you can find “ocean views that won’t break the bank.” Despite a growing interest from buyers and agents there are still amazing homes and properties available at excellent prices. According to International Living the prices for ocean view homes in the Southern Zone (starting at $150,000) are one quarter the price one would pay for a similar property in Southern California. But even if we look at prices of comparable properties in other parts of Costa Rica, the Southern Zone is still a bargain by comparison. Homes in the region are still a fraction of the price of similar homes in the very popular Guanacaste region.

Dominical Real Estate Dominical Real Estate

With all the attention that the area has been receiving lately, is it possible that we are on the brink of a boom? Is the Southern Zone the “new” Guanacaste? While we can definitely expect a steady increase in prices as more attention, amenities and comforts arrive to the area, there are a lot of factors to counterbalance this. First, there is a tremendous amount of protected acreage. But second, there is the simple fact that it’s the views and nature in all its simplicity that draws people to the region. It is precisely the lack of sprawling resorts and condominium high rises that attract potential buyers to the area. We probably won’t be seeing large-scale disruptive development, or huge condo complexes anytime soon. But if you haven’t thought about the Southern Zone, you should probably start paying attention to the region. Property values are surely on the rise.

If economic factors are not motivation enough, you get so much more than just value in the Southern Zone. The area is home to 3% of the world’s species. Here, you’ll find more acres of preserved land than in all of Costa Rica. Ballena National Marine Park is great for spotting humpback whales (giving rise to the nick-name “Ballena (Whale) Coast”). The landscape is postcard perfection with expanses of lowland rainforests and green mountains that melt into the seascape. The new coastal highway makes it an easy three-hour trip by car from San Jose. You’ll also find a growing population of expatriates who have brought with them new restaurants and a variety of international dining options. For someone looking to connect with nature and get back to the real, unspoiled Costa Rica, the Southern Zone is the perfect place.

If you are interested in exploring this beautiful region, Joshua Kanter is one of our Properties in Costa Rica’s best resources for finding a home in the Southern Zone and was recommended in International Living’s article. He lives full-time in Dominical and knows the ins and outs of finding the perfect property in the area.

Contact us for assistance and to view any of our listings

 

In Costa Rica we have much to be thankful for

On the Thanksgiving holiday we are reminded to be grateful and practice generosity with others.  In real estate we can apply this principle at various levels.

As a broker or agent it can help us to redirect negative energy into positive energy.  For example, when faced with adversity such as a difficult client or a challenging project or listing, we should strive to take negative feedback and turn it into positive energy and make ourselves more productive by listening, absorbing feedback and making the necessary modifications.  It’s what will make us better and what sets us apart here at Properties in Costa Rica.

In Costa Rica we have much to be thankful for:  beautiful weather, gorgeous backdrops, the ocean and beaches- sometimes all in our own backyards.  We should also keep in mind the importance of simple acts of generosity and balance success with kindness.

Especially in a country where balance is so crucial.  We have new construction- hotels, restaurants, resorts, homes, shopping areas- all surrounded by natural beauty and wildlife.  As real estate brokers, developers, prospective property owners we must keep in mind that this is what is important in Costa Rica.  It’s what draws people here and keeps us here.

We need to be thankful and mindful.