Costa Rico is “rolling out the red carpet for Americans…”
Red Carpet Treatment for Americans
Craig Studnicky, the CEO of ISG World, a real estate sales and marketing company, said, “Costa Rica is rolling out the red carpet for Americans, and Americans are moving there.”
As the pandemic transitions to an endemic, Costa Rica is increasingly welcoming international buyers, particularly American buyers. A pending 2021 change in the law that governs residency requirements will reduce the minimum investment for residency to $150,000 from $200,000. The maximum renewable residency term will go up to 10 years plus Costa Rica’s import tax rules were amended to allow foreign residents to bring certain personal goods into the country on a duty-free basis.
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Along with these pending residency changes, Costa Rica is also in the process of establishing a digital nomad visa that will grant temporary residency to people who earn at least $3,000/month.
These revisions obviously don’t apply just to Americans but, with so many Americans buying in Costa Rica, Studnicky said, “I’m affectionately referring to Costa Rica as the 52nd state.”
Market Overview
Costa Rica celebrated its 200 years of independence from Spain last year. The country’s Central Valley is home to the majority of Costa Rica’s five million residents and includes the capital city of San Jose. The country’s multiple markets along the Pacific Ocean coastline, which leads in demand, have kept prices stable over the last year.
According to Linda Gray, broker-owner of Coldwell Banker Coast to Coast Properties and vice president of the Coldwell Banker Costa Rica master franchise, said that nationwide, Costa Rica’s market picked up after a “very, very slow” 2020, and is now “more active than we have seen in years.”
Many of Costa Rica’s most popular areas for investment are near Culebra Bay and the international airport in Liberia. These Pacific northwestern areas include Playas Del Coco, Playa Ocotal, Playa Hermosa and Play Panama.
Tim Fenton, broker of Blue Zone Realty International, said that prices in the southern coastal region of Costa Rica jumped +20% in the second half of 2021 and another +20% during Q1 2022.
Studnicky with ISG World agreed with Fenton. His firm is rapidly selling 196 three- and four- bedroom homes in a development on the southern Pacific Coast called Ventana Costa Rica.
Prices
As you can guess, prices along Costa Rica’s Pacific Coast are higher than in the Central Valley. However, even the priciest multi-million homes in Costa Rica, according to Studnicky, are comparable to what prices were 15 years ago in Miami.
The median price for newer three-bedroom properties within two miles from the beach hovers around $350,000, up from about $240,000 18 months ago. Larger, ocean-view luxury properties closer to the water have a median price of $950,000, up from $675,000.
Fenton with Blue Zone Realty International said that his firm sold three times more in terms of dollar value than it did in each of the preceding three years. He also emphasized, “…you can still find an amazing home for a very reasonable price, and that the benefits of owning a home here in paradise are priceless.”
Who Are the Buyers?
The American influx into Costa Rica is being led by Californians, Texans, Floridians and New Yorkers. The recent increase of direct flights to and from Europe has also brought many more European buyers to Costa Rica as well.
Without restrictions to foreign buyers, all real estate transactions are handled by a notary in Costa Rica. Most foreign buyers pay cash due to high interest rates on mortgages offered by private banks however, some sellers offer mortgages with rates ranging from 5 – 8.5% over three to five years.
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Thanks to The New York Times.
