Reputation carries Costa Rica real estate market
First-century-B.C. poet and actor Publilius Syrus wrote in his book of Latin maxims that “a good reputation is more valuable than money.”
Twenty-two centuries later, Syrus’ adage remains true, though when applied to business terms, a slight change perhaps is equally accurate: “A good reputation brings money.”
Costa Rica is an example of this. The country is marked by a glowing outward reputation. Abroad, Costa Rica is considered a beach-and-jungle paradise with friendly people and a low cost of living. It is a name brand, and one that thrives on a good reputation.
Due to this image, the Costa Rican real estate market seems to usually keep its head above economic tidal waves that batter other countries. While property sales might not be riding atop the monster wave they surfed in 2007 and early 2008, people from across the world continue to think of Costa Rica when looking to invest in a beachside apartment or condo, a second home or a place to retire.
“Costa Rica remains a very attractive real estate destination for national and foreign buyers for the primary reason that people want to own land and property here,” said Miguel Fiatt, a board member at the Costa Rican Chamber of Real Estate Brokers. “The country’s reputation keeps this market steady even during difficult economic times.”
Steady serves an apt descriptor for the Costa Rican real estate market in 2011, while “stable” for 2012 is a widely shared outlook from agents across the country. Though all acknowledge that the boom of previous years has passed, real estate interest in corporate projects, resorts, homes, condos and apartments is constant in different regions of the country.
“The market has a way of equalizing itself,” Fiatt said. “Different regions become attractive at different times. [The northwestern province of] Guanacaste is not as popular as it used to be, though sales of homes and property in the Central Valley have increased significantly. It’s always difficult to predict what will happen, but demand in Costa Rica remains rather strong.”
According to several national agencies, the type of demand has evolved during uncertain international economic times. Bruce Wood, of Costa Realty One, said that while home and property sales tapered off slightly last year, rentals surged.
“Rentals have really heated up,” Wood said. “It’s harder for people to borrow as much money as they could a few years ago, so they want to come here and try out living here to see how it works out. There is less access to capital, which means there are more people looking to rent than to make a larger investment and buy.”
Wood also said that high-end buyers are beginning to show a renewed interest in large investments such as resort projects and commercial developments.
“The market is still suffering from where it was, but it’s starting to look up again,” Wood said. “Costa Rican real estate has proved itself to be pretty resilient.”
On the commercial property side, Griselda Lara of regional developer Portafolio Inmobilario said that more large-scale projects are projected for the upcoming year, such as Avenida Escazú’s tower project southwest of San José. The company currently is building several San José area commercial centers and is expecting to break ground on more condos, offices and shopping centers this year.
“To say that I think the real estate market is strong at this current moment might be a bit premature,” Lara said. “But in the middle to long term, it looks as if there is an abundance of large commercial projects being developed across the country.”
Several other large resort and condo developments are popping up on the Pacific coast, including the recently finished Preserve at Los Altos in Manuel Antonio, on the central Pacific coast. The sleek, new four-bedroom, 3.5-bathroom furnished suites provide an ocean and jungle view with all the amenities inside.
“It’s still a very young development,” said Alejandro Weintz, developer at the Preserve at Los Altos. “But we have high expectations for how it will be received by owners.”
Given the large volume of projects around the country and the steady interest in property from foreign and national buyers and renters, the Costa Rican real estate markets appears to be in good shape for 2012. Development is rampant and interest is constant.
“From our perspective, we are confident that there will be growth this year,” Fiatt said. “Interest is still very strong in our principal markets, such as the U.S., and things look very positive to begin the year.”
With a sunny reputation attracting new prospective buyers, the next 12 months should keep real estate agents busy across the country. As Syrus once wrote, “a rolling stone gathers no moss.”
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