By Buzzy Gordon
Buoyed by enviable national economic and political stability, the Costa Rican real estate market is making a comeback. And thanks to improvements in infrastructure, nowhere is this more evident than along the country's burgeoning central Pacific Coast.
The republic of Costa Rica has long been an anomaly in Central America: an oasis of democracy and rule of law in a region known more for repressive dictatorships and social turmoil. This history—along with the country’s natural beauty and well-developed infrastructure—have combined to make Costa Rica the most popular market for foreign real estate investment between Mexico and Panama.
“In the 1990s and early 2000s, initial property values were so cheap—relative to Cabo, for example—that an investor could conceivably double his money every year.” The onset of the global financial crisis in 2008 heralded the end of the boom years for Costa Rican real estate. “Real estate investment was no longer a value proposition,” Cutter recalls. Instead, the real estate market entered what Cutter calls “an adjustment period.” Now, after four years of declining values, this seasoned real estate broker believes that “prices are poised again for value acquisition.”
Currently, according to Cutter, there are bargains to be had. “I don't think we'll see a return to the best of times,” he muses, “but there is plenty of opportunity—and owners can earn steady streams of cash from renting their units to vacationers.”
The firm 2 Costa Rica specializes in an area of the country that is a focus of renewed interest, in the wake of the completion of a new highway linking the capital of San Jose and its international airport with Costa Rica's central and southern Pacific coasts. The resort towns benefiting most immediately from the recent inauguration of Route 34 are Jaco, now just 90 minutes from San Jose, and Manuel Antonio, another hour further down the coast.
And these represent just the beginning. Like a new frontier, the entire southwest region of Costa Rica is opening up as it becomes more accessible. Quepos, the small port serving Manuel Antonio, may yet produce the kind of yields investors enjoyed a decade ago.
“Quepos is waiting to explode,&rdquo Cutter predicts, pointing to the construction that has already begun on a new marina. The marina, set to open in 3-5 years, will offer the kind of maintenance and service for yachts not available from Florida to the Panama Canal. In anticipation, investors are already buying up commercial properties in the quaint downtown of the port that once teemed with ships exporting bananas and palm oil.
Self-contained Resort Community: Los Sueños
Not that there isn’t a worthy marina already serving the area. A 200-slip marina has been operating at the world-class Los Sueños Resort and Marina at Herradura Bay, just north of Jaco, since 2001. Founded and built by California developer William Royster, who introduced terracing construction and techniques to this part of Costa Rica, Los Sueños is often hailed as the most successful resort project in the country.
Home to nine distinct residential communities—spanning the range from apartment condominiums to townhome and casita—style condos to stunning and spacious villas—Los Sueños has sold more than 500 luxury units to date. It is on pace to reach 1,000 residences and homesites conveyed over the coming years.
Customer satisfaction is extremely high at Los Sueños, insists Lisle Head, a specialist in Jaco area real estate. “I’ve sold residences to Los Sueños homeowners several times over,” he reports. “Typically, an owner will start out purchasing a condo and then, as new neighborhoods in the development become available, upgrade to a newer and larger residence.”
According to Head, Los Sueños units sell so fast that there is no brand-new construction presently on the market. “The next phase will most likely not be released until next year,” he says. Head expects the prices of those homes will range from $750,000 to $1 million.
Meanwhile, Head maintains a list of resale properties, ranging from a 2—bedroom condo for $460,000 to multi-million dollar homes in the exclusive Altamira neighborhood, where one villa currently tops out at $5,900,000.
Los Sueños residents enjoy a host of resort amenities, including the Marina Village, an upscale shopping and restaurant complex; the aforementioned marina, which can accommodate boats up to 180 feet; a medical clinic; beach club; 18-hole championship golf course; a five-star Marriott Hotel and adjacent casino—and even a heliport. Other recreational options include a private 600-acre rainforest reserve and tournament-class sport fishing.