Why Jaco beach Costa Rica real estate is a smart investment strategy!

 My very first published letter as to why it's very smart

to invest in Costa Rica real estate, and especially Jaco beach!

A.M. Costa Rica

San José, Costa Rica, Friday, June 23, 2006 Vol. 6, No. 124

Dear A.M. Costa Rica:

Well I think I was either too sarcastic or not sarcastic enough since I received a lot of emails today asking if I was really leaving Costa Rica after 13.5 mostly glorious years. Would you be so kind as to publish another letter from me?
I will admit that I am a real estate Broker (now, Costa Rica Beach Investment Real Estate), 9 years in the business, mostly in San Jose, but the past few years in Tamarindo and Jaco.  I moved from Tamarindo for a number of reasons, but mostly because as a full time resident, life is much easier when the big city essentials are less than 2 hours away and not 6.

My analysis of Costa Rican real estate BEACH prices is determined by what has happened to other international beach hotspots, enduring various boom-bust cycles.   What determines fair market value in any situation is to check "comps" (comparables) and in this case, those beach communities that can offer to the North American retiree/adventurer a place to purchase for investment, rental income, or a new way of life.

Without delving into lifestyle issues and comfort zones found for the typical N. American seeker, we must first start with travel time from the United States/Canada.  Obviously, the closest places are the Caribbean, (foreign residents subject to island fever) and Mexico, (personal safety issues and lack of 100% title).  We also have to rule out Guatemala, El Salvador, Honduras, and Belize, though each place has something unique to offer for a week or two, to live or invest in these countries for a long period can be perilous.  Nicaragua has been attracting more super adventurers as of late, but I have little respect for Nicaragua's political smarts (oxymoron?). Panama is probably Costa Rica's stiffest competition, but that's still a secret,  and it's too damn hot.  So that leaves Costa Rica as the nearest, safest, easiest to adapt to foreign country closest to the United States for residents and investors alike.
How high can prices go you ask?  Go to google and type in Cancun or Puerto Vallarto beachfront condos for sale.

Try to compare condos that are not in towers that are 20 stories tall (I would prefer a building limitation of 7 stories here in Jaco!).  With Mexico, remember, no foreigner gets 100% ownership-fee simple title and Punta Cancun Beach front Condos, are being offered between $480,000-$700,000.  Are Costa Rican beachfront condos with title worth the same amount or 30% less than Cancun? One can play these games with google with Hawaii (much more expensive), the Caymans (bet there's more former residents of the Caymans living here than the reverse) ad infinitum.

The point is that Costa Rica now enjoys a very favorable image within the United States, Canada, and Europe as both a place to live and as an investment opportunity. Of course buyers have to use their head- booms come and go, as sometimes markets get saturated with product for a short time, but in a world renowned locale, prices are
usually justified and will continue to rise, maybe not as quickly, but comparable to other places. Just remember, this ecologically renowned little Switzerland of the Americas hasn't yet come close to being as famous as other hotspots.  Invest now because prices will continue to rise,  just don't be stupid, check and compare. Thanks for listening.
Jeff Fisher - Broker-Owner 
CR Beach Investment Real Estate,
jeff@crbeach.com  

UPDATE: It's now August 20th, 2007 and Hurricane Dean is close to wreaking havoc  again in  Mexico's resort area of Cancun. Again I am thankful that the Jaco area of Costa Rica receives very little of nature's wrath. Last week we had our first tsunami warning, thanks to the 8.0 Peruvian quake, but this was more a preparation drill by the CR Emergency Services  than the real thing. Less than 2 hours later, the warning was rescinded.

  A little internet research comforted me to know that the last tsunami to hit Costa Rica was in 1854, and it was in the southern region of Costa Rica. Remember, the hills are only seconds away!

 We are often asked what type of natural disasters Costa Rica is most vulnerable to, and the answer for the Jaco area is: some minor earthquakes, occasional minor flooding,(not as severe as tonight's news about floods in many U.S. cities),  but thankfully NO HURRICANES.  The major complaints of most foreigners that live here range from the occasional power outages (how romantic?) and weak cell phone signals (how frustrating!) to the typical rage against government bureacracy and ineptness.  Most complaints have to do with the newest restaurants' prices  for shrimp cocktails!

Real Estate Market Update: Soon we will start the third year of the "boom" for the Jaco Beach area and finally prices are stabilizing after shooting up dramatically.  As friends of mine from Florida and California tell me, the beachfront is still a deal, even at $135 sq.ft. This is difficult for long time residents like myself that remember when..., but I know and experts agree that the Costa Rica real estate market still has many years left before there is a major correction.  There are plans for at least 5 more towers in Jaco, some over 20 stories (they didn't listen to my 7 story limit!), so yes, Jaco's future looks more like Puerto Vallarta everyday.  This can be great for "smart"  real estate investors, and developers, and fun seekers!  Don't like crowds? Live 10 minutes away and it feels like a whole new world, with forests, and mountain breezes!

 What about Baby Boomer retirees? Well personally I would love for some developers to call me and look at those properties that would be perfect for developing Costa Rica's-beachfront-active-Baby Boomer communities."  There is a need for more homes in this area in well designed gated communities at all price points. They can either be beachfront, or close to the beach, or with large lots with fantastic ocean views, but the key words are community. Not just, here- enjoy your community pool and barbecue area, but all kinds of activities; physical, mental, cultural. A community center on the premises with all kinds of classes- spanish, dance, yoga, cooking; wine tastings, sushi gatherings, backgammon, and outdoor areas; for horseshoes, croquet, lawn bowling, putting green, volleyball, etc., etc.   You get the idea, active Baby Boomer activities, who will eagerly come to Costa Rica for six to twelve months at a time, not just six weeks.  After 14 years, I still love living here; call me and let me know what you think.                                                  

  Thanks,

Jeff.  (Happily living 200 feet from the always beautiful, occasionally dangerous waves of Hermosa, 8 minutes south of Jaco). *I also did guess right about Nicaragua...  

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