The Costa Rican real estate market took a nosedive with the rest of the world when the Great Recession hit a few years back. Since then, those in the industry have been peering ahead for that light at the end of the tunnel. Though a full recovery may still be a ways off, real estate insiders around the country say business is slowly picking up.
Aleyda Bonilla, president of the Costa Rican Chamber of Real Estate Brokers, told The Tico Times in an e-mail that the market began to recover during the first quarter of 2010 and has since continued to gradually pick up.
“There has been a timid awakening in selling homes and condos on Pacific beaches, while the GAM [greater San José metropolitan area] residential sector has been growing at a steady pace with an excellent range of properties,” she said.
Meanwhile, the commercial sector has shown a moderate increase with excellent prospects for the eastern sector of San José, Bonilla said, adding that banks have begun reopening their doors to developers, which has allowed them to resume stalled projects and begin new ones.
“Buyers … feel more secure in this economic environment, given the growth in actual employment levels, and the opening of new financing alternatives,” she said.
Agents around the country confirm Bonilla’s optimistic report.
“It’s starting to get better, honestly. Things are looking up,” said Les Nunez of First Realty (www.firstrealtycre.com, 2672-1181) in Playa Hermosa, a beach community in the northwestern province of Guanacaste. “I want to be very candid and not just paint a rosy picture as most realtors tend to do. But yes, it certainly is better than it was last year.
“Certainly it’s no reflection of 2005, 2006 and 2007 – that type of market, which was a very strong market. In 2009 to 2010, things really fell off. So, what we’re seeing now is certainly more people coming in once more.”
While business appears to be picking up, Nunez said high-priced homes generally aren’t the ones being sought.
“The middle- and lower-priced homes, those are the ones that are really starting to move now, as opposed to the top end,” he said. “So, if I were to put that in some sort of dollar figure, anything between $300,000 and under, you’re getting good inquires and even purchases now.”
Over on the southern Caribbean coast, Gregory Petin of Sunrise Coast Realty (www.sunrisecoastrealty.com, 2750-1902) said he has noticed a revitalization as well.
“We’re having buyers coming in again and asking about properties,” he said. “We have European people that are coming, Italians and Spanish more than anything … and we also have a few Americans starting to come back.”
And while the number of inquiries has begun to rise, Petin said, prices have gone down. “Compared to last year, we probably have 20 percent more traffic. And prices this year have still dropped about 30 percent compared to last year,” he said.
In the Central Valley, Karen Ebanks of Karen Real Estate (www.karenrealestate.com, 2282-4191) in Santa Ana, southwest of San José, agreed the market is regaining momentum.
“I think it’s definitely picking up in San José,” she said. “And I think Atenas [in the western Central Valley] seems to be like a hot spot. I think it’s becoming popular. But I’m getting a lot of requests on hotels. I don’t know, maybe people are thinking they want to have a business when they get here.”
Ebanks said e-mails have started pouring in over the past three months. She believes that the comeback in the market reflects restless buyers who cannot wait any longer.
“I really think people are restless now. They’ve been sitting and waiting too long,” she said. “They want to buy something. They have the itch. And I think a lot of people want to relocate to Costa Rica.”
Bruce Wood of Costa Rica Realty One (www.costaricarealtyone.com, 2228-5961, 8339-2112) in the western suburb of Escazú said it may be too early to assess the situation, but he does feel that things are on the upswing, at least a bit.
“It’s so difficult to tell, but I think it’s getting slightly better,” he said.
Wood cited three markets in Costa Rica: Guanacaste, the Central Pacific region and the Central Valley.
“The Central Valley certainly didn’t take the hit that the beach areas did,” he said. “There are a few deals to be had, but most of the values are really when cash buyers come in and make an offer. I see activity, but it’s still slow. I see activity picking up now. This time of year it always picks up at the beaches. But I’m seeing a little more this year in the Central Pacific area than I have been.”
Wood said he thinks Central Valley prices have stabilized, and added that value is still to be found at the beaches, even though developers haven’t been dropping their prices.
“When a cash buyer comes, they’ll do some deals,” he said. “They’ll cut some prices pretty significantly.”
Wood predicts that growth is going to be good again in the next one to two years, because a lot of inventory is clearing out of the Central Pacific region.
“I think the growth in the future is really going to be in the Central Pacific,” he said. “In Guanacaste, there’s just too much inventory, and I think it’s going to take almost three years to clean that up.”