Quick thoughts as to why I am still optomistic about the real estate market in Jaco, Costa Rica!

by Jeff Fisher, Broker-Owner CR Beach Investment Real Estate Aug 6, 2008  (formerly of Santa Cruz)

Hello from my beautiful semi-beachfront bungalow home in Playa Hermosa, just 8 minutes south of Jaco, Costa Rica, recently named by  The World Travel Awards Feb. 2008, that Jaco, Costa Rica won "the Leading Beach in Central America."   And Costa Rica is the second best tourist destination in Latin America and the Caribbean, according to a survey by the World Economic Forum (WEF), which evaluated 130 nations (Mar. 14, 2008). 

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 20%-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. Is Costa Rica the best choice?

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 as options, 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 had been attracting more super adventurers as of late, but Daniel Ortega's election and rule is proving too risky. Panama is probably Costa Rica's stiffest competition, but  it's too damn hot and most of the forests have been eliminated.  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. 

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 charge the same high prices as their Mexican or Hawaiian counterparts. Not yet!  And remember, we only sell 100% fee simple titled property!

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, Costa Rica 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 with the greatest community support from the other Ex-pat residents.  In a world that is increasingly more unfriendly, more violent, more expensive, I have yet to hear a better option than Costa Rica. 

Why is Jaco, Costa Rica a great place to invest NOW?:

1. The new highway was started in Jan 2008 and will be partially finished-2010? 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 beachfront "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 Costa Rica region of Guanacaste,  their land procurers will discover like I did, that the Central Pacific area near Jaco 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. year round tropical green  e. the proximity to the nation's largest airport & 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 w/ lower prices!  Yes I am still very happy to be living in Costa Rica!