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Title Check by Brian Smith
Someone did point out to me that some attorneys do a "title" check in the
on-line registry for about $100 and that is totally correct. You could even do
it yourself, however it is not accurate 100% of the time and can even be
manipulated (note the earlier CRL posting where someone was offering a service
to check the on-line registry EVERY SINGLE DAY)....
The type of service I was referring to for "up to $1000" is extremely detailed
and would include an attorney performing a physical title check of ownership and
caveats in the repository in each province, a check of mortgages or liens, a
check for building or other restrictions, a thorough and legally liable review
of the contract and more. That also includes a physical visit to the site (up to
1 hour away or more), communicating with the owners, physically checking the
presence of utilities, a check of local property values, a check on the ability
to build, consultations or recommendations, a full written report and more. And
there is always more.....
When I think of this service, I think about what I would want done to confirm a
good purchase if I could not be here in person to do it myself. I'm just a
careful guy and want to do everything possible to insure no problems.I don't
really view this as a "money maker". After the attorney fees are paid, there is
not a great deal left over for the agency for all that work and
responsibility.....
Buyer's agents generally charge much more than this for about the same work.....
Quick thoughts as to why I am still optomistic about Jaco! by Jeff Fisher, Broker-Owner CR Beach Investment Real Estate April 6, 2008
Hello from my beautiful semi-beachfront bungalow home in Playa Hermosa, just 8 minutes south of Jaco. I just got done posting in our "Costa Rica in the News" section that the town of Jaco was awarded a Blue Flag. We have one blue flag now and well on our way to having the actual beach receive a blue flag. And we are getting a beachfront boardwalk! For those that have lived here a long time, (15 years for me!) this is almost unbelievable news!
I am always being asked how the continual negative real estate news from the States is affecting our business here. I always say the truth, maybe things are slower by about 10%-that's all. Costa Rica is still unknown to many N. Americans and still has a tremendous allure to those that have never been here. The publicity surrounding the vast quantities of "Baby Boomers" who are active and interested in either retiring full time or half-time to Costa Rica is constant. Articles about vacationing in Costa Rica appear daily in my Google alerts about Costa Rica; today I received articles from Modesto California and several blogs describing what an incredible country this is.
But how's the market you ask? Will there be a glut of condos available that will drive down the price? The facts are that most of the beachfront condos currently under construction are sold out. Many are currently being "resold" at a profit, anywhere from 10-40%. The situation in the States is affecting us here, in that many developers here with new condos to sell will have to be more reasonable in setting their pricing! The "flippers" are accepting less than they had thought they might be able to charge for their investments of only one year ago--but there are still profits to be made. These are all positive signs for the moment because Jaco condos currently do not have the right to charge the same high prices as their Mexican or Hawaiian counterparts. Not yet!
A few weeks ago an investor from Florida was here that missed out on some tremendous opportunities a few years ago that I had shown him. He could have tripled his investment dollars. Instead he invested in Florida and is now suffering tremendous losses. He showed me his emails that everyday were touting liquidations of condos and homes with discounts from 30 to 50%.
How can I compete with that I thought? How do we in the real estate business in Jaco compete with the foreclosure hysteria in the States?
I have had time to reflect and the answer is Florida is in the United States, and so is San Diego and Padre Island and New York and Las Vegas. The minority of world travelers, second home purchasers, and international retirees will always seek out a place that is not in the United States. Costa Rica welcomes these visitors, inspite of all its problems, in a way that is rivaled by no other country. The "land of peace" the "Switzerland of the Americas" is indeed the most expensive place to live in Central America, but it is also the safest and closest to the U.S. with the best weather, great lifestyle options and most community support of other Ex-pats. In a world that is increasingly more unfriendly, more violent, more expensive, I have yet to hear a better option than Costa Rica. More thoughts-
Why is Jaco a great place to invest NOW?:
1. The new highway was started in Jan 2008 and will be partially finished-2009? reducing travel time from the airport to Jaco to under 75 minutes.
2. The hard work of the Jaco Chamber of Commerce, (www.cenpac.net) promoting real changes. Very few other international destinations have as strong a local-Gringo positive guiding force. They just sponsored Jaco's First Art Festival.
3. International travel and eco awards continuing to publicize Costa Rica and Jaco Beach.
4. Pricing that remains cheaper than other beach vacation and retirement destinations, especially when you factor in , no taxes on property gains, and best of all, annual property taxes of 1/4 of 1% annual of declared value. ($250 for every 100k).
5. The "boardwalk" or promenade will garner Jaco the positive international reputation it has been seeking since the town's renovation. Police and infrastructure changes are improving everyday.
6. The neighboring oceanview and beachside communities within 25 minutes of Jaco will become very desireable places to live for those that seek a mellower lifestyle. Golfing and boating fanatics will be overjoyed at the choices offered and other adventure enthusiasts will continue to appreciate their options.
7. Whereas many major hotels have been announced for the northern region, their land procurers will discover like I did, that the Central Pacific area is the place to be: a. better weather here than up north (6-10 degrees cooler). b. better availability of water for developers and locals alike, see our news section! c. easier access to and response from the local Municipality d. continual year-round tropical green e. the proximity to the nation's largest airport and capital San Jose is a real asset; after all this is a small country! f. greater availability of goods and services than any other beach community g. LOWER PRICES for almost everything compared to the north!
thats all folks, any comments-put them in the blog!
Jeff Fisher Owner-Broker CR Beach Investment Real Estate April 6, 2008
We spent last week at the tourism fair in San Jose Costa Rica and I wanted to share with my readers some of my observations. Many of you have noticed that I regularly post articles about Costa Rica on my blog. Some have even commented that I must be working for the tourism board of Costa Rica as it appears that I am putting down Panama by making comparisons between the two countries. The fact is that Costa Rica has some very positive aspects that we should emulate and learn from along with some negative aspects we should try and avoid. I believe it is important for Panamanians and foreigners alike to fully understand what sets them apart in order for the country to make the most in what each has. To say that one country is better than the other needs to be understood in what context. I read in the international press where Panama is the next Costa Rica or where the IPAT says Panama will surpass Costa Rica in tourism and I am extremely skeptical of these kinds of proclamations. I hope that the following analysis and observations might help us to understand these differences and better equip us to take advantage of our strengths.
Lets start with Costa Rica.
One thing we should all agree on is the fact that Costa Rica has been attracting eco tourism for a much longer time than has Panama. While Panama was dealing with Noriega, Costa Rica was attracting foreigners to retire and those foreigners built the tourism infrastructure over the last 20 years or so that has made Costa Rica the attraction that it is today.
Here are some facts I gleaned from my meeting with the ICT (Costa Rican tourism board.) in San Jose. Costa Rica has over 2000 hotels with about 40,000 total hotels rooms. The average hotel size is less than 20 rooms. 85% of the hotels are owned by foreigners and 85% are located outside the city. The focus of 99% of these hotel operations is eco tourism. Last year Costa Rica had about 1.7 million visitors.
What strikes me most is the contrast between these hotel statistics and those of Panama. According to this article I posted last year, Panama is expected to have 24,000 hotel rooms by 2010 with the addition of 7,000 that are currently underway. The majority of these hotels are being built in the city. Go here to see a post about their size and location. The beach areas west of the city are certainly attracting a volume of foreign tourists, but this type of tourism is more in line with the beach areas of Cancun Mexico than the small eco resorts of Costa Rica. When hotels are built in cities they are clearly for business related activities and not eco tourism.
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Why there is no eco tourism in Panama
The fact is there are very few eco tourism hotels in Panama and there are several good reasons for that. All one has to do is to drive across the border from Panama into Costa Rica and it becomes readily apparent. As we drove across the border last week my wife, a Panamanian, exclaimed that it looks so different just as soon as you make the crossing? Costa Ricans notice a difference too as they come into Panama. For us it is the abundance of vegetation in Costa Rica and the stark reality of open cattle pastures in Panama.
Panama has long ago sacrificed its accessible rain forests and jungles for cattle farms and agriculture. It is not that the Costa Ricans are by nature more ecologically minded than Panamanians. The fact of geography is one of the reasons they have had little deforestation. Within a 15 minute drive as you cross the border into Costa Rica, you notice that the terrain turns from flatlands to mountains. The Talamarca mountain range which runs 30 kilometers back from the Pacific all through Panama, becomes much closer as soon as you enter Costa Rica. Mountains are more difficult to clear for cattle and with the lack of good roads to remove the timber, it is the main reason Costa Rica has so much more forest and Jungle. Certainly the laws Costa Rica enacted and enforced protecting the environment in the earlier part of the 20th century have helped to protect the land from ranching after road building began in earnest there, but the geography and lack of good roads early in its history has played a major part in protecting its environment.
By contrast,the next time you take a plane from Panama City to David, look below and notice from the mountain tops to the Pacific and you will see that the land has been stripped of all its timber. Even in the higher elevations you see the distinct criss crossing of dirt roads and cattle trails along the mountain ridges. These roads were used by the settlers in the beginning of the 20th century to clear the land of jungle and make way for the cattle ranches that now fill the landscape. The only areas where you see any forest, other than the national forest preserves, is on the undeveloped Caribbean coast where there are no roads to access the forests. There is little tourism development there either for the same reasons.
By contrast, the mountains along the Pacific coast of Costa Rica meet the sea bringing their forests and the abundant nature with them. You hear the sound of howler monkeys as you drive along the road that in most places meets the ocean. This type of geography also produces the beautiful crescent shaped beaches of white sand that are in abundance all along the coast. It is in these mountainous coves where you find the great numbers of small eco hotels catering to the tourists seeking the eco adventure advertised in every brochure and media outlet on Costa Rica.
Along the coastal areas of Chiriqui the sand is dark and the beaches stretch for hundreds of meters between low and high tide as the slope of the land is very shallow. The numerous rivers bring a great deal of silt as they travel through the cattle pastures and rice fields. Even some of the islands close to the shore have been turned into cattle ranching. Only in the national forest of the Chiriqui highlands will you find the pristine jungles that once flourished across the whole province. And, other than on the Caribbean, only on the numerous small islands in the Gulf of Chiriqui will you find the white sand beaches and jungles that are similar to those of our neighbor to the west. What areas of natural beauty we have left in the province are incredibly beautiful, but they are not nearly in abundance as in Costa Rica.
The Panama advantage
Yes there is no doubt that the advantages of the Costa Rican environment is strikingly different from that of Panama, but there is the other side of the coin that needs to be addressed. Panama has some significant advantages over her neighbor to the west. We have a number of foreigners who live in Costa Rican who cross the border and stay in our resort in Chiriqui. They are amazed at how civilized Panama appears to be over the country they chose to live in. The roads are much better and they can buy just about anything here at much lower prices. From the moment they cross the border into Panama they are not thinking about how we have cut down all the forests. They are thinking about how great our four lane highway is and how nice to see shopping centers and hospitals along the road way. They wonder why they have such very high duties on their goods and vehicles in Costa Rica while we have very little. They are amazed that our home prices here are less than half that of their country. Crime is a growing concern in Costa Rica as they have become a victim of their great success at attracting foreigners to vacation and live on their shores and mountains. Another great advantage they see in Panama is the corporate and tax structure. Many of them cross the border to open bank accounts and form Panamanian corporations to protect their assets in Costa Rica.
In conclusion
So the facts are that Panama can never really compete with Costa Rican as an ecological tourism destination. Panama has the advantage of a well documented and incredible history of transformation from a 1500’s backwater to the center of the universe in transits for goods and services in the 21st century. It is in her unique combination of modernization, infrastructure, history and culture that make Panama a major attraction as a place to live and live well rather than just to visit. Panama cannot afford to spend millions in marketing to be something she will never become, but she can and should focus on her strengths and attract people to her shores to live here rather than just pass through along with the containers in the canal and money through her many banks.
There are many foreigners who long to live among the forests and monkeys and are willing to share that world with the many visitors that come to gawk at the incredible world of nature. If you can afford to pay for it and are willing to sacrifice some of the many comforts of the first world, then Costa Rica may be the right place for you. If on the other hand you want access to all that natural beauty on a few hours away, but still want to live where goods and services are reasonably priced and in abundance, then Panama may be the right choice. After having lived in both countries I find Panama to be more to my liking
South of the Border,
The Market's Still Hot
Americans Find Second-Home Boom Endures; Wildlife in the Neighborhood By JUNE FLETCHER December 14, 2007; Page W12
The housing slump has sent many Americans shopping south of the
border. Existing-home prices in the U.S. dropped 4.5% in the third quarter from a year ago, according to S&P/Case-Shiller. But they are still climbing in much of Latin America and the Caribbean.
Buyers are being enticed by the kind of double-digit
appreciation that has all but disappeared in the States. In
addition, a growing number of new developments are targeting
Americans looking for good deals and a lower cost of living.
Since 2003, annual home-price appreciation has been running at
20% in the Dominican Republic, and could reach 50% in the near future, according to Boomerang Unlimited, a Napa, Calif., real-estate investment advisory firm. In San Pedro, Belize, the average price of a 2,200-square-foot home was $697,500 in September, up 18.6% from a year ago, according to a study by Coldwell Banker; the price of a similar property in San Jose, Costa Rica, was up 20.7%, to $389,900, the study said.
Prices remain low compared with those in the U.S., particularly for waterfront properties. Because Americans generally buy and sell properties throughout the region in dollars, not the local currency, home prices don't fluctuate with the various exchange rates, as is the case in Europe. What's more, the dollar generally buys much more house in these countries than it does in the U.S., because labor and land are less expensive.
LIKE FLORIDA IN THE '50s
Still, the rapid appreciation is drawing growing numbers of bargain hunters, making good deals scarcer and causing some customers to look beyond the usual vacation hot spots. In the Dominican Republic,
Century 21 broker Dean Brown says that 80% of his buyers this year have been Americans, compared with half last year. Softec, a real-estate consulting firm, says in the past three years, investments in vacation homes in Mexico, primarily by buyers from the U.S. and Canada, have shot up by 60%.
Americans' appetite for investment opportunities is helping to spur a building boom in some areas. In Panama, 170 residential-building projects are under way, mostly marketed to Americans, and 100 more are in the pipeline, according to Panama Legal, a law firm based in Panama City.
Among them, a 1,500-acre resort and marina by Naples, Fla.-based developer Todd Gates. The project, on Isla del Rey, one of the Pearl Islands near Panama City, is slated to open in 2009 and will have condos, villas and singlefamily homes ranging from $275,000 to $1.4 million. "It's like Florida was in the '50s," Mr. Gates says.
Some buyers are buying sight unseen. Shams Deitrick, a Walnut Creek, Calif., financial adviser, recently bought a furnished, two-bedroom "ocean view villa" for $375,000 in Canto del Mar, a new 35-unit development in the southern Costa Rica town of Dominica; the project has already sold out. "All I saw was the Web site, which showed a sloth 30 feet from the unit, and monkeys everywhere," Mr.Deitrick says.
He snapped up the home on the advice of a gym buddy, who said his own Costa Rican properties have quadrupled in value over the past four years. Although Mr. Deitrick isn't looking forward to the daylong flight to Dominica when he visits for the first time in February, he says he's glad he bought the property: "It just doesn't make sense to buy in the U.S. right now."
BARGAINS, WITH TRADE-OFFS
Preston Thompson, a retired Clearwater, Fla., hospital administrator, hopes to make some money in the Dominican Republic as a "serial renovator," moving into homes, fixing them up, and selling them. In
July, he bought a 2,100-square-foot house for $265,000 on the beach in Cabarete, quickly added $50,000 worth of improvements, and put it back on the market for $489,000. If the property sells, he and his wife plan to repeat the process.
Getting the house ready to sell hasn't been as easy as he anticipated, however. Subcontractors were hard to find -- only one firm in Cabarete (population about 15,000) could do granite countertops, for example
-- and the quality of their workmanship was "hit or miss," Mr. Thompson says. Worse, neither he nor his wife speaks Spanish, which made communicating with the workers difficult. He's also concerned that
Americans may be turned off by local health-care facilities, which he says are very modest. For all of its current popularity, he says, the Dominican Republic is essentially still a developing country. "You have to put up with inconveniences," he says.
Earlier this year, Geoff Folsom, a Thousand Oaks, Calif., businessman, bought a 4,500-square-foot oceanfront penthouse, with its own private swimming pool, in Trump's Ocean Resort in Playas de Tijuana, Mexico, a 30-minute drive from San Diego, Calif. He paid $3 million for the property, about half the cost of similar resort units he looked at in the States.
Property taxes and maintenance costs are lower than in the U.S., too.
There are trade-offs, he says. The mostly undeveloped area outside the development's gates has few restaurants and hotels, and Mr. Thompson is concerned about recent news reports of armed robberies on nearby roads. Still, he anticipates that, as the area develops, appreciation rates will exceed anything he could get in the U.S. "You get so much better value south of the border," he says.
There are additional downsides to buying in this part of the world. The weather can be violent and unpredictable: Last month Hurricane Noel slammed the Caribbean, causing floods and mudslides, and
leaving 147 dead. And insurance to protect against natural disasters, including earthquakes, may be impossible to obtain.
In addition, many foreign real-estate brokers are unlicensed and don't necessarily adhere to the business standards that Americans expect. Some, for example, encourage sellers to raise their asking price after
American buyers have made a full-priced offer, even if no other bidders are involved. Plus, not every place is a boom town. Seasoned real-estate brokers say that to be successful, developments need at least some amenities and should be within an hour's drive of an international
airport.
Cuxlin Ha, an 80-unit riverfront retirement community in Punta Gorda, Belize, near the Guatemalan border, is about 300 miles from the closest international airport, although a small "air taxi" airport is eight miles away. On the development's Web site, house hunters are warned that "this is not an area that promotes exciting night life and wild times (unless you're a jaguar or a howler monkey)." Buyers apparently have taken the hint: Although a three-bedroom, fully-furnished 1,350-square-foot home sells
for only $100,000, only two buyers have stepped up since the project opened two years ago. "People want a more touristy area," says Bob Prehall, the Roseburg, Ore., broker who's selling the project. But if a place does draw tourists, Americans are willing to travel long distances to buy there. Shaun de Jesus, a San Francisco derivatives sales manager, bought a three-bedroom condo in Punta del Este, Uruguay, three years ago for $120,000, then got a distress-sale deal on a two-bedroom condo in the same town for $90,000 six months later. On the southeast coast of Uruguay, about 90 miles east of Montevideo, the beach town -- which has its own international airport -- has a year-round population of 7,300 that swells with vacationers in the hot months of December and January.
Since he bought the properties, Mr. de Jesus received an offer of $150,000 on the first unit, and $170,000 on the second.
But he's not selling. Even though he gets down to visit only two times a year, he says he is pleased with the units' low maintenance costs and the high rents they pull in when he's not around. In fact, he's now looking for another good deal. "If something comes up, I'll jump on it," he says.
URL for this article:
http://online.wsj.com/article/SB119758837723028177.html
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When and why it appears
 Sustainability, as a model for development, establishes the need to satisfy the requirements of today's society without making it impossible for future generations to satisfy their own. Basically, this means that the development of a country cannot be achieved by the unrestrained exploitation of its resources (natural, cultural, social, etc.) to the point of extinguishing or destroying them, seeking to fulfill the needs of the present population (food, housing, health, work, etc.), without recognizing that these resources are the only platform, or potential asset, that the future generations of this country will have to meet their own needs.
For tourism, sustainability is not only a response to the demand factors of the industry, it is an indispensable condition to be able to compete successfully and, even more important, to be able to survive over the long run. The ever-deteriorating
The classification criteria utilized by this program is worthy of exportation. Our commitment to the future generations demands the implementation of this initiative.
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Mauricio Ventura Aragón, President of The National Tourism Chamber (CANATUR)
| world ecological and social crisiss have had a significant impact on human consciousness and, therefore, have also seriously impacted the accelerated growth rate that environmental tourism experienced in the past decade, to the point that it has meant a significant change in the habits and expectations of the world's tourists. Unfortunately, in the last decade we paid most of our attention to the ecological aspects, but very little to the implications of the impact that tourism has on the quality of life and on the sociological heritage of the communities that are directly affected by this industry. It is time to change the tourism tide to a more integral one, namely, a sustainable tourism.
As we look at these changes in the expectations of the tourists, we notice how each day they are demanding a more active, more interactive tourism, with greater respect for the socio-cultural and ecological interests of the local communities, with higher standards of service, and with the ability to protect and regenerate the natural environment as well as to learn about local customs. Of course, all of this must include a high level of enjoyment of their hard earned vacations.
At present, we are confronted with a new set of rules for the demand/offer factors in the industry, where it is clear that the unwarranted alteration or destruction of resources (natural, social, cultural, etc.) which constitute our attractions and tourist products, will inevitably mean the destruction of tourism as an economic activity. Likewise, it is not only the tourists, but also the potential investors, who are selecting with great care the companies or projects in the tourism field in which to invest their funds, seeking out those that act in harmony with the social and ecological interests of sustainable tourism. If we add to these two factors the fact that tourism is a demand driven industry, we can easily understand why these changes are having a transcendental repercussion on the tourism product that is being offered. This is why we can clearly state that "Tourism in the XXI'st Century in Costa Rica will be sustainable or it simply wont be!"
The process of Certification for Sustainable Tourism constitutes an excellent alternative in the field of tourism development, not only taking into account aspects of the tourism infrastructure, but also considering social, cultural and patrimonial aspects of community.
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Licda. Ana C. Arias Quirós, Anthropolgy and Sociology, School of the University of Costa Rica
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In summary, we define sustainable tourism as the balanced interaction of three basic factors within the tourism industry: 1- Proper stewardship of our natural and cultural resources; 2- Improvement of the quality of life of the local communities; and 3- Economic success, that can contribute to other programs of national development.
It is also a source of concern that sustainable tourism is a concept which is only beginning to be developed, and that it does not yet have a solid reference base or measurable parameters that are appropriately established and universally accepted. This has permitted a significant number of companies to take advantage of the growth of sustainable tourism in an irresponsible manner and thus incur in what we call "Greenwashing", or a commercialization of a tourism experience that does not comply with the reality of the experience provided to the tourist when he/she reaches the destination. The immediate effect of this unethical behavior is to generate a great deal of mistrust on the part of the consumers about the products being offered, with very serious consequences for the whole industry.
For Costa Rica, a country that has emerged as a leader in sustainable tourism and has very successfully projected itself in this field, the above problem is of strategic importance to its future. It is precisely to contribute to find an integral and global solution to this problem that we propose the immediate implementation of the Certification for Sustainable Tourism program, known by its initials "CST".
This program is an institutional initiative inserted within the National Strategy for the Development of Sustainable Tourism, and is part of the government's national and regional programs which seek to move the model of development of our country closer to parameters of sustainability.
The main objective of the CST is precisely to turn the concept of sustainability into something real, practical and necessary in the context of the country's tourist competitiveness, with the aim of improving the way in which the natural and social resources are utilized, to motivate the active participation of the local communities, and to support the competitiveness of the business sector.
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Friday, September 07, 2007 The Beach Times
US Housing Crisis Not Affecting Costa Rica
The crisis in the US housing and financial markets, already spreading to Germany and Japan, is not expected to have a serious impact in Costa Rica, experts said this week.
Despite concerns with a record number of Americans set to lose their homes to foreclosure and house prices getting lower all the time, the general consensus is those buying in Costa Rica are not likely be greatly affected.
“I am under the impression that the foreign investor that comes to invest here in Costa Rica is precisely that type of investor that already has enough buying power, and has already resolved his housing situation and has come here to have a beach home, or a home in the mountains,” Finance Minister Guillermo Zúñiga told The Beach Times in a phone interview Wednesday.
“That is not the investor that would be affected by this situation.”
Should the current woes compound as far as to “affect the dynamism of the North American economy, and the real economy,” Mr Zuñiga said, “this could have an impact on the demand for our products, and that would have an effect.”
The problem, say economists, began with what are known as sub-prime loans — loans given to people who have poor credit. Many of those loans are adjustable rate, meaning the lender can change the interest rate. As those rates have climbed in recent years, many borrowers have been unable to meet payments, defaulted, and left the banks holding property, rather than money.
The business of repackaging debt to be traded in financial markets has meant the problem has had a wider effect, and the lack of payments has caused a shortage of money in the system, leading to a “credit crunch” and making it hard for some to get loans.
However, Mr Zúñiga says there are no signs that Costa Rica is, or will be hurt by these problems.
“I would not expect changes in what is happening in our country,” he said. “The foundation of our economy is solid, and the financial situation is very solid.”
In the first three months of 2007, mostly American foreign investors and homebuyers bought at least $192 million worth of property, largely in the provinces of Guanacaste and Puntarenas, according to Costa Rica’s Central Bank. That is nearly triple the $70 million registered in the same period in 2006.
Mario Solano, a Central Bank economist that worked on the estimate and tracks foreign investment in Costa Rica, said this week that the bank had not yet studied whether the crisis was affecting the country, but said, “Costa Rica could be affected, but not in the short term.”
The US Embassy also said it had no information on the possible effects in Costa Rica.
“I think the state of the US housing market will have an affect on others, but it has not been felt yet in Costa Rica,” said Ana Saboría, CEO of the Guanacaste tourism development, Reserva Conchal. “I don’t think it will be as radical an affect as in the United States. I don’t think it will reach the point where it is a pricing issue.
“It will probably mean that people will have to go for quality in their buildings, to make sure they can make a difference. If, as a developer, you don’t start with a base, with a large base and a good product, then you might have trouble,” she added.
Cynthia Durán, president of the Costa Rican Global Association of Realtors, said: “Right now, it is difficult to measure how it is affecting Costa Rica, because we are in the low season, and we know that, with the lower tourism that comes in during these months, sales fall.”
“We have been analyzing this a lot, and we have to give it a few months so that we can compare this low season to last year,” she said. Long-time Guanacaste realtor Les Nunez, said he recently asked an audience if anybody had been affected by the crisis. Nobody said they had.
“The scuttlebutt amongst us area realtors is if its going to effect us we haven’t really seen it yet. Is it going to trickle down? I imagine to some degree,” Mr Nunez said.
“If the thing sneezes we catch cold. But if their market gets decimated, maybe five or ten out of a hundred won’t be able to come down here and do what they want to do.”
Jeff Fisher, of CR Beach Investment Real Estate in Jacó, said he believed those buyers that are now unable to get financing in the U.S., to come buy property in Costa Rica, would be balanced out by the new buyers.
“The other half will look at Costa Rica as an exciting alternative. They’ve lost optimism about financial gains in the United States and know Costa Rica is booming,” he said.
Mr Fisher wasn’t the only one to say the current situation could possibly bring benefits to Costa Rica. Finance Minister Zúñiga said that if the US Federal Reserve cuts interest rates to help out the market, that could result in lower rates in Costa Rica.
Antonio Echeverría, a Loan Officer with Banco Improsa, and who formerly ran his own Mortgage Broker service, said he believed the slumping market in the United States is already driving US lenders to Costa Rica.
“The housing market in the United States has fallen and financial companies are coming here. It’s not a prediction, it’s a fact,” he said.
Other effects could be that in the Costa Rican economy, interest rates are falling and becoming more and more attractive.
“Banks are offering very low interest rates due to the high volume of real estate and construction in the country. With the arrival of gringo companies, it will be even more competitive,” he said.
With downward pressure on interest rates, and the arrival of more lenders, could Costa Rica eventually tread on the same unstable ground that is sending the US into problems now?
“Because Costa Rica is rising now doesn’t mean it will be that way forever,” Mr Echeverría said. “They have to be very careful not to fall in the trap of basing on adjustable rates. Those are favorable for the banks, but only as long as the debtor can meet the debt.”
Buying Costa Rica Land From The Telephone Boiler Rooms by Scott Oliver
Sept 1, 2007
http://www.welovecostarica.com
Thousands of people who have bought land from the dozen or so companies that send out millions of emails per week and then have someone in a boiler room in Florida or California beat you to death on the telephone to "close" the sale are now waking up to reality and realizing that their land is not at all easy to sell...
As far as we know, it's not illegal for a high-pressure salesperson in the USA - many of whom have never even set foot in Costa Rica - to sell you land in Costa Rica using this method, but it's just not a smart thing for you to do, especially buying land in a foreign country without seeing it first and doing your homework.
We've been writing about Americans selling land in Costa Rica by this high-pressure method for about five years now and even though there are about 20 different projects that we can think of with thousands and thousands of acres of land and, from what we are being told, during this time there have been less than 20 homes built in all of the projects combined.
One problem that people did not expect, having listened to their salesman tell them that they could buy the land, split it into two and sell off one lot to pay for their new home - Yeah right! Is that most people who have wanted to sell their land have been unable to do so.
Buying Costa Rica Land Is Easy - Selling May Not Be.
Why can't they sell? Because there is no open market for this kind of land...
Who are you going to sell it to? If you are really lucky, the company that sold it to you 'may' buy it back from you and resell it but why would they want to buy it from you to resell your land to one of their customers with a tiny mark up when they can sell their own land with a stratospheric mark up and huge commissions to that same person?
Nobody else in the open market wants it... It's an artificial closed market where the price action is determined by the marketing people.
The reason this land increases in price is NOT because of supply and demand, it's not because people are banging on their doors to buy it, contrary to what they may insinuate and what their email marketing campaigns show - this is not prime ocean view land - the only reason their land prices increase is because they increase them. Simple.
Buy Now Before The Price Goes Up!
You see it's always useful for a salesperson to have a 'sense of urgency' so if they have a regular price increase, it makes it appear that this land is in demand and, the salesperson can genuinely say that: 'You'd better get on board now because prices are going higher at the end of the week" before he pockets his double the industry standard 10% sales commission...
And please remember when the next Costa Rica land salesman calls that the #1 focus for these companies is to sell you land for a much higher price than they paid for it so that they can make money.... They don't give a damn whether you can build your dream home on that land or not.
Some of them claim that they will help you build your homes but since we have seen less than 20 built in the last five years, this promise does not sound promising.
From a recent WeLoveCostaRica.com Discussion Forum thread:
"When he first went there, some dude called Flores said they would build his home for $90 per square foot and that construction price would be rock solid for two years when he planned to build his home which was one of the main reason he bought a land there. Then only five months later (not two years) they tell him the construction costs would not be $90 per square foot but $130 and he is real mad because for his house plan which is just about 2,500 square feet that's and extra US$100 grand he has to find and they lied about the roads which they said would be brick pavers but are now going to be asphalt and he don't believe them much about anything anymore."
Are these boiler room salespeople lying to you too?
Martin Gill mentioned that; "... we do get guys asking us to re-sell their lots..." and..."The big problem is that these developers sell this as an investment and people think that they can flip their lots and make money, but they forget that there are 2,000 lots just like the one that they have." And "unless you have an awesome ocean view the homes will be hard to sell."
If They Don't Build It For You, Who Will?
And if they don't build your home for you, who will? Because if you are thinking of building a single family home anywhere in Costa Rica from a distance, may we politely suggest that you rethink that idea...
We get emails every week from people saying they bought lots in one of the 'Sold-Me-Hard Projects' and could we recommend a Realtor to help them sell their land. Unfortunately, my response always goes something along the lines of: "Sorry we have already asked our recommended Realtors to see if any of them would be interesting in helping you out but there is not one single Realtor that I know of in Costa Rica who is remotely interested in selling your 'Sold-Me-Hard Projects' lot and would be surprised if you find one..."
These land promoters make it difficult for their potential buyers to visit the land they are trying to sell them - unless they have already paid a big deposit BEFORE they have seen it (??) - so how difficult do you think it is for an outside Realtor to gain access?
Depending on the overall market conditions, land can be a very illiquid investment, meaning it can be difficult to sell in a timely fashion but when your Realtor can't even visit it, it's impossible to sell.
If you are planning on buying land in Costa Rica and wish to invest your money where it has the highest probability to make you money with the lowest possible risk, I would suggest that the next time you hear from one of these boiler rooms, you tell them that you are not interested and hang-up.
Instead, find yourself an experienced, trained Costa Rica real estate sales professional that will sell you the land you want and, when the times comes, he or she will also be happy and proud to help sell your land for you...
Written by Scott Oliver, author of How To Buy Costa Rica Real Estate Without Losing Your Camisa and Costa Rica's Guide To Making Money Offshore. © 2007-2008 WeLoveCostaRica.com All Rights Reserved. Reproduction without permission prohibited.
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S4 | CENTRAL PACIFIC SPECIAL SECTION | THE TICO TIMES – August 24, 2007
Condominium Boom Turns Upwardly Mobile
By Peter Krupa
Tico Times Staff
They say these days that the construction crane is China’s national bird. But by all appearances, that exotic species is migratory, and at the moment it is making a stop in the central Pacific beach town of Jacó.
Just glancing out her office window in the center of town, Catherine Fitton, one of the owners of Jacó Beach Premier Realty , said she could count six of the gangly beasts, lifting and swiveling and dropping to build the hottest thing going at the moment: high-rise condominium towers.
Of course, in Jacó anything more than eight stories counts as a high-rise, Fitton said. But more than a dozen of the projects are either preparing to build or already under construction.
“Everything really took off within the last two years,” Fitton said. “(We) went from very little inventory to condos in the thousands.” It’s a phenomenon that’s rearing its head from Playa Herradura, just north of Jacó, all the way to Quepos, 60 kilometers to the south. Condo developments are booming.
They’re big.
And they’re selling.
“When people ask whether Jacó can sustain all these high-rises, the truth of the matter is they are at least 70% sold out,” said Jeff Fisher, the owner of C.R. Beach Investment Real Estate, www.crbeach.com).
Take Diamante del Sol, for example, a beachfront development undertaken by DayStar Properties. The project, which will have five condominium towers between eight and 10 stories with a total of more than 100 units, is almost 60% sold out already, even though the first two towers won’t be completed until next year. Condos here are selling for between
$450,000 and $1 million, and Fitton said some pre-buyers have already resold their yet-to-be-built condominiums.
At least 17 high-rise condo projects are either completed, under construction or in the planning stages in and around Jacó. The Sonesta Jacó Resort project , for one, is only just beginning the foundations on the first phase of what will be a $70 million, six-building, 13-story development. Yet it has already sold 140 of the 196 first-phase condos, priced between $215,000 and $1.2 million. That phase should be completed in late 2008, said project manager Joshua Ten
Brink, and the second phase is set to begin early next year.
Several real estate agents said the boom owes itself mostly to middle-aged, uppermiddle- class buyers from the United States and Canada who have discovered Costa Rica and are buying vacation and investment
condos here.
“I feel like we’re getting to the point where the masses are starting to become interestedand know about Costa Rica,” said David Karr, an agent with Century 21 Jacó Beach “It seems like in the past it was a hidden secret and more of a niche.”
Although a few large projects can be found outside Jacó – for example, the planned 12-story twin condominium towers on Playa Hermosa, five kilometers to the south, that will be Diamond Beach Resort if the developers manage to secure permits (TT, Feb. 23) – most of the high-rise developmentis concentrated in the former sleepy surfer village.
The boom has some people in Jacó concerned about the town’s infrastructure.
“I think that we should be concerned,” Fitton said. “The … local government and the central government need to be workinghand in hand with the development so we don’t see an overbuilding.”
Fisher noted that area developers have high confidence that the Central Pacific Chamber of Commerce and the new mayor of the canton of Garabito, Marvin Elizondo, will work together well to address the problems that are sure to crop up as the town gets more crowded.
He said that within the next 10 years he expects the area to look like Puerto Vallarta, Mexico, a tourist destination known for its beaches and luxury hotels. Fitton agreed, saying she thinks Jacó will soon be considered a “very nice small city, rather than the surfer village of the past.”
Other Developments
High-rises may be sprouting like weeds in Jacó, but the wide-open surrounding area calls for a different kind of living arrangement. Projects involving villas, townhouses and even whole family homes in gated communities have sprung up all along the central Pacific coast.
One big one – with permits in place and earthmovers warming up – is the St. Regis Resort, which will be a 250-acre complex with 49 condos, 42 villas and nine estate homes. Announced in 2006, the project was |