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During our research of Costa Rica we came across an article debating to buy or rent in CR. It was biased but interesting.


"Why spend $350,000 for a gringo home when you could invest it in a CR Credit Union at 13 1/2 o/o."

We chose to rent, but I watched the market that first year. By God, he was right, $350,000 x 13.5 o/o (1 yr. CD). At the end of the year you had about $397,000, or $47,000 profit to live on in Costa Rica.


This past year has been very different. If you invested your $350,000 in the credit union at the prevailing rate of 10.5 0/0 you expected to realize a profit of 36,750. In fact, with the current volatile money market (US $ =558 Colone) you lost your profit and some of your principle.


Buy Colones at 492.5/$ X $350,000 = 172,375,000 colones X 10.5 o/o interest = 190,474.375 colones.

Now you want to cash out in US Dollars.

Sell 190,474,375 colones at current rate (572 colones/US $) = $332,997.

In addition to your lost profit ($36,000), you have also lost $17,000 principle for total loss of $53,000


Todays Rate: BUY Colones = 558/$ BUY US DOLLARS = 572 Colones/$

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Hello again Ron,


When I searched for credit unions in Costa Rica several years back I was told by more than one person who was knowledgeable about banking in CR that there are no credit unions in Costa Rica. At least none which are equivalent to what we know as credit unions in the U.S.

So, what is it that are you referring to in Costa Rica as a 'Credit Union', please, if you don't mind me asking.




Paul M.


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Okay... Thanx David.


I do know about "Mutual" -and BTW it's not "Mutual de Alajuela" anymore; it's just "Mutual", without the reference to Alajuela. I only just found that out a couple weeks ago.


I have a dollar savings account at Mutual and have maintained it for four or five years now. Opened my first account in CR at Mutual when Scotiabank, BAC (Banco San José), and Banco National at first all refused to open an account for me. (Later on I did finally open colón and dollar savings accounts at BNCR.)


But Mutual is not really a Credit Union; it seems to be more like a Savings & Loan. And I cannot write a check from my Credit Union account in the US in dollars to deposit into my Mutual account. That is because due to CR regulations Mutual can only receive instruments demominated in Colones!


Just FWIW . . .


Paul M.


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Part Two of a 'sad but somewhat similar' story....


So you get off the plane here, either to look around at property after making a connection with an agent, or you already have a place in mind and money in the pocket.


In the last two years of 'looking' at homes throughout the Central Valley, I have yet to meet a qualified, professional broker/agent. Of course there must be one or two. Otherwise expect to hear, "This is the kitchen"...


I have an eager agent calling me with listings since Friday and they have not yet arrived today.


Another lisiting of a German agent that I want to see 'asap', has not been seen by me for three weeks, as he has 'family problems'. He will not tell me exactly where it is though, to protect his commission. (Imagine that YOU hear about this as the seller of this home.)


An agent in Santa Ana with an actual storefront, not just an internet presence, and a USA passport holder here for thirty years, wanted ME to drive US 'behind Volcan Poas' (her car is not operating) for a 'fantastic bargain 30 minutes from the airport'. Maybe 30 minutes by helicopter, but more like 1 1/2 hours by car. I had told her that I wanted to look around Santa Ana/Ciudad Colon, so why she thinks I would want to live beyond cable or Automercado is a mystery. But OK, I wanted to know exactly what she had. She hasn't sent me the listing link, although it turns out to be above Zarcero, not Alajuela. She's never been there actually, so after we had arrived at Waterfall Gardens, I might have realized we were not close.


Another Dutch foreigner selling here for years took me up to the wind towers above Santa Ana, I hike there frequently, and showed me a $200K log cabin in the woods with a (noisy and ugly) windmill towering and grinding away just off the lot line.


Note - If you don't ask the right questions here, you definitely are left to assume the best. And if you haven't lived here a long time you won't know what questions to even ask!


I go down my 'mental check list of possibilities'. There seems to be an HOA of three houses up here paying the owner $200/mo for (drum role) ....water coming off of his property. Otherwise this is the restricted zone for building and better check if you can drill for water. But this house, with chandeliers and a refrig and a new 4 person hot tub in the master would lead anyone flying in from Peoria to assume there must be electricity, even if it is turned off. Houses have electricity in 2014, even in Costa Rica. Right?


But I asked anyway.


"Electricity? You'll just have to ask CNFL to hook you up, it's nothing, they can do it immediately."


The house WAS off the grid, good that I asked at the CNFL office. And better that I talked to CNFL to discover that I was three power poles and 100m of cable strung across the property from the last new pole on the road from having electric. Thousands of dollars worth of poles and cable in fact. When informed of this, the agent shrugged, small matter.


Another agent shows me a building lot above Santa Ana. I bring an engineer and interview the neighbors. The lot of 5,600m2 with two steep hillsides was listed at $99K until I asked about it, wherupon ithe price was $125K. The 'guard' was found to be growing pot there as the owner is in Mexico. The same guard is charging people to dump on the lot above where he keeps a 24 hr fire burning. Records show at least 10 'denuncias' have been filed and served, but the fires burn bright still. And the debris, purposely allowed there to 'expand' the lot is collapsing down the hill onto the property I am looking at. The engineer tells me, "I would not build a house on this lot, a hard rain could cause that entire hillside to collapse." The agent tells me 'not to worry' and to 'make an offer and see if we are in the ballpark.' No. I learn that the only water is coming from the well of a neighbor through a garden hose. I had requested the plat, and the agent stalled. When I got the plat I found a dedicated public road not built yet intersected the property. I asked Santa Ana about this and there is a process to get this feature taken out, but it will be time and $ and there is no certainty. And then I learn that this property is too close to the nearest well and one cannot drill for water on it, either. If you're the buyer expect to catch rain water to water your cows.


A nearby house on a 2,500m2 lot with a well is shown to me by a neighbor. "The owner is a Dominican and wants to sell. It's $200K." The house is a 'tear down' built from scrap wood and metal in stages during each Semana Santa :>) But the lot is spectacular and has well/water and could be made private and secure. I pursue more info and learn that there is a renter inside. You cannot remove a renter easily. "Find another house" my atty tells me. The neighbor tells me that the $200K includes $5,000 bribe for the renter to leave. And oh, a $5,000 commission for him, just for being neighborly. He is not any type of real estate agent although he owns a gas station. I interview the renter and learn she IS a real estate agent. I learn the property has been in foreclosure for a year and will be owned by LaFisse bank. I go there and am told they are just waiting for a judges signature. It's been a year....


I look at a fine house above Grecia, it's 8km from the crater of Poas. Poas is an active volcano due for an 'ashy' eruption based on its pattern of eruptions. In 1913 or so the black cloud went a couple of km into the sky and filled the Central Valley with ash. This property could be under several inches of ash. I've lived through that in the Philippines. Ashes are greasy, gritty and invasive. Furniture and electrical appliances can be tossed. But at my age I'd gamble I get twenty years of silence. Of course at the altitude of this home, rainy season means living 12 hours in a mist. I realize this. The sellers are Americans, the agent is an American. It's all blue skies to them. When I do my best estimate of value for this $220K asking price, I come up with $190's based on the agents other listings and proud descriptions of her past sales, although a much more lux house nearby with a disappearing edge pool sold for less than the asking price of this one. The agent explains that the asking price includes the agent selling commission. "It's normal for sellers to take care of commissions" she claims. I guess it includes the transfer tax, too based on the sellers inflexibility. Because the listng is in sqaure feet, and the house is exactly 2,000 ft sq, I ask for the dimensions. The footprint is 7 m2 square larger, worth almost $5,000 more in construction costs that the agent or sellers had wrongly calculated. My new all-cash $196K offer is rejected and I am told not to bother to make more offers, "you will never meet our price." The owner had told me that he couldn't grow tomatoes there, "the acid rain from the volcano eats through their skins." The agent tells me, "You shouldn't live in Costa Rica if you worry about volcanoes."


That was an ironic and goofy comment for every reason related to selling real estate here but especially because I'm a mountain guide that's climbed every mouintain in CR even climbing to the craters of Arenal last April (sh-h-h-h-h----)


A property in Ciudad Colon 'was' $295K, then $249K and is now $199K for the returned-to-the-USA American absentee owner. "Maybe she'll take $170K" I'm told by the Bolivian agent with offices in the Forum. I look around and note that there is no wall above the edge of the property, a mere 4m from the house separating it from some very poverty-type tipico homes. A wall needs to be built. I hear the sounds of metal being cut. I walk out to the street and two doors down is a chop shop for cars. Nice property, but bad luck.


This was this agents 2nd opportunity after showing me a house in Escazu. I was interested and wanted a second look, then would likely make an offer. She's late after I arrive, no one offers a ride, but another agent is there. "Didn't she tell you this house is sold?"


I look at a lot above Heredia, and the agent tries to convince me that the house 'just needs remodeling'. It is a re-incarnated two-story barn that vandals had scorched the interior of. It's $200K though because one could raise tilapia 'for income' where they damned a creek. Two months later the property has been 'stolen' as shown on the registro by unscrupulous notary/attorneys.


One can 'chase a lot of geese' in Costa Rica during your search for a dream as agents miss appointments and don't call/don't answer their phone, while they let you drive them around as so many have 'broken cars' only to waste gas looking at grossly over- priced properties. It takes some endurance to find a bargain here, even to find something 'priced right' that you want to live in.


And you better want to die there, too. Any free standing, not in a gated-community home over about $250K is un saleable. Professional Ticos want the security of a gated community and the lack of maintenance of a condo. The average Gringo arriving here wants to limit expenses and doesn't have a bag of money anymore. Maybe the Venezuelans showing up will buy, just like the Colombians before them...


When I sold my house above Alajuela, a certain agent related to this website's sponsors didn't show up for the sit down with the ultimate buyer. He had something else to do. I negotiated the sale myself down at the rancho. The agent showed up for the commission, though. I give him credit for being the only agent in many years even to have clients to show the place.


Potential buyers should consider what is happening here in 2014. And I write this while loving so much about Costa Rica and Costa Ricans that I have no plans on leaving. But I am here for nature, not business.


The govt has evolved from welcoming foreigners to adding every obstacle. In the 1970's until about 1991 you could bring in a vehicle and personal property with 'exonerations' - tax free. No more.


One could become a rentista by changing $1,000/mo. into colons. It's now $2,500/mo and you have to join the Caja for which most people pay $60-300/mo and never use it. I go there for small things showing up at 6:30am to make an appointment for later in the day. But when I needed a colonoscopy last month- my doctor warning me 'it might be cancer, so this is an emergency'- the first appointment was for April..... 2015. I paid for it elsewhere and there is nothing remotely wrong with me (gracias dios). So most $ spent for the Caja membership is really just a tax for the priviledge of staying here.


And even after jumping through the flaming hoops and having your residency papers officially accepted by Migracion you still have to leave the country every 90 days to keep your foreign driver's license 'fresh'.


Then there's the FATCA/FUBAR USA IRS issue. Scotiabank receives from me an annual letter from my brokerage in the USA stating my ability to provide the $ needed for residency and that it comes entirely from that account. This year that letter wasn't sufficient. I gave them last years tax return. "You don't make enough $ to live here. We will close your account." Wait. They demand to look at the entire holdings in the account, mostly stocks and bond funds. Good enough, "see you in two years". Phone rings a week later. I need to sign a statement for SUGEF and interested parties giving them the right to do a credit check. I sign. Phone rings this morning. My data is insuffucient, they want to re-interview me ...


You can't live here easily without banking ability. You can't have a driver's license without residency. Residency is difficult to achieve. Owning a house without it? Owning a car without it?


But one must also have a US address, not a PO Box, to keep a bank account in the USA which is difficult to do when one is registered with the IRS as a resident of someplace else. Obviously, you can't be a resident of two countries simultaneously in the eyes of the IRS. So you lie to your American bank and give them some family member's address.


And don't forget, if you are not an official resident of CR then you ARE a resident of the USA and must apply for Obamacare if under 65. Don't apply to Obamacare and watch the 'multa's grow, based on your income. There's a giant Catch-22 gotcha!


Next CR President Solis is quoted in AMCosta Rica last week as suggesting (again) that Tico and foreigners' off shore assets be subject to a 'wealth tax'. It could be short-lived, like the 'luxury home tax' here (that was later made permanent), or it could be annual. Scotiabank now knows every penney I own because they insisted on having my account holdings or they would close my account. If CR institutes a wealth tax, they can insist II will leave. Any cost-of-living savings for being here will evaporate.


So think hard about 'your dream' of owning a home here unless you have endless money.


Now imagine I was able to purchase that nice house on the high slopes of Poas, now with no more all-cash Gringo buyers in sight, and too far away from the big city jobs and attractions to attract an all-cash Tico buyer. I have a family emergency, I must take care of my ageing mother, maybe a year or two. I want to sell my dream house....


Is that volcanic ash raining down clogging the gutters like cement during this 'Green' season all-day rain here up high in the mountain gloam?

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Soooo, the agent didn't show up for the sit down with the seller? Try this one - wanting to partake of the ordering service through a company, I sent them the COMPLETE information they needed to make me the quote.After 3 E-mails of their replies that they needed the link (of course I'd copied and pasted total relevant information), I had to make one long distance phone call to get the quote! I receive that quote, and head for the bank for the required funds. When I showed up at one of their "any" of their "sucursals" to make said payment on the article, (as advertised in their literature), they refused the cold, hard cash that I had in my grubbly Little paw. (All ligitimate US dollars, that I had just pulled out of the ATM machine at the bank) $US dollars rejected - cold hard cash - US dollars REFUSED as payment! Anyone else ever Heard of this? I sure haven't! Not in my lifetime! Until this last week - in Costa Rica!!

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Hey Marsrox,


Your Parts I & II in this thread should give any sensible newbie gringo expat at least a bit of pause.


I've heard tales like this before here and there. Your narrative ties them all together into a nice big bouquet. Thanks for taking the time to write them down in one place for folks to read through and consider.


Your two narratives only reinforce to me the sensibleness of renting rather than buying. I have a decent casera in Alajuela and a nice, but not fancy, but definitely safe, apartment in a secure tico building. I cannot see any reason to sink my funds into buying a property of any sort. Plus if there ever should be unpleasant problems that develop then as an inquilino I can always up and move and rent elsewhere since I am not tied to an unsaleable property.




Paul M.


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First to Paul: I took the time to write because most folks willing to pull up roots and move here based on a 'dream' often wake up to a nightmare. It doesn't have to be that way. It is a little more difficult to 'just live a life' in Costa Rica then it is in some other countries, like the one they left, because the govt 'keeps moving the cheese'. Most (foerign born) people I know don't watch Canal 7 news or read La Nacion because they don't understand Spanish, and don't even read AMCosta Rica which is about the only source of 'hard' news available in English, the other websites, even the Tico Times- for which I wrote for many years, mostly 'good-time tourist' reads.


Some sources claim that at least half the people who arrive to 'retire' here permanently leave in one year because of the challenges. It's also true that some of the 'foreigners' living here never worry about a thing, can't speak Spanish past BUENO and thrive. Ignorance is bliss.


Maybe because I am not a pensionado with some fixed-income guaranteed, nor am I a wealthy person as defined by some of the palaces hidden here and there around the country, and since I live alone without a special someone to lean on and share expenses, I stay in 'survival mode'. I have to count on me, period. I don't want to run out of money because I did something stupid through ignorance or carelessness.


Does anyone?


By that I mean that while I really enjoy life, have friends that I relax with and am glad for 2x1 dvd day, I have no $ that 'doesn't matter'. I can't just say 'no importe' over another large financial loss. I'm too old to go back and work in the USA.


No one expects their marriage will end, that the unprecedented market crash of 2008-2009 would take 50% of retirement investments earned and saved over 40 years. I didn't think in Costa Rica I'd own a fantastic home here that I would sell at a $50k loss after nine years and $250,000 in remodeling. But we all have our 'adventures'. :>)


So its good that the feria is full of excellent and inexpensive foods and that I cook better than what's served in most restaurants, even rolling my own sushi eliminating that 'need'. My main source of enjoyment are hobbies like 'hiking', 'bird watching' and 'reading' eliminating the need for yachts and owning a Rolex. I'm thoroughly 'cured' of chasing Ticas which keeps me 'on budget' and out of trouble.


I am also glad for those of us who can visit the Four Seasons and just toss plastic at the bill when it comes without a care. I'm sure they earned the right.


But I am bothered to see each new wave of foreigners show up of which to a degree some will be predators, the rest are the prey.


And its not just about real estate, there are small dangers lurking behind every toucan. When I had my B&B, fully 50% of every guest 'lost' or had something stolen while here for just a week or two. I was always fascinated by how little they worried about it, as if having something stolen in Costa Rica earned them the 'rite of passage'.


But my point in writing those articles was to review my latest experiences in real estate, and this is the proper forum.


Had I not lived here as a renter (and Rentista) from 1990-95, then spent years 2000-2003 looking at properties again, especially those being fire-sold by 'investors' who lost everything ($6 million collectively?) with 'The Brothers' (you give them money, you get no receipt but they promise 3%/mo interest.... until they don't pay that or return the principle) before buying an underpriced bargain, had I not had a half dozen brokers price my home at THEIR PERCEIVED VALUE, trying to sell it for $1.2 million, until I cut the price to $799,999 ("Are you crazy?" they asked me), then $599K, while discovering that large properties for big bucks outside of Villa Real have few takers, I wouldn't feel qualified to discuss this at length.


This tome isn't hearsay, I'm not writing about 'urban legend'. Please note that most of the real estate agents I mentioned were not Costa Ricans. Most of them show you one house and if you don't purchase it, they don't pursue you.


Newcomers to foreign countries are naturally prone to trust other foreigners in transactions, thus they migrate to websites in English. If incomplete or incorrect info is shared, it's not questioned because they are not competent to do so. Every foreign real estate agent brags on their local expertise. Some have expertise, too.


In my experience, even after I've discoverd a material defect with a property, the fact it has no water or electricity or has a dedicated public road planned to cross it, the agent continues to advertise the property without revealing these issues.


In Florida, during the 1980's - 2005, I was at times licensed to sell health, life, long term care, fire insurances and annuities. I was twice licensed to sell real estate. There were rules/regulations/penalties/licensing fees and continuing education.


Here there is NOTHING to prove your real estate competence, no barriers to entry and basically no penalty for fibbing, mis-representing or stealing. The courts do not effectively offer recourse to right a wrong. Possession becomes 99+% of ownership.


How dangerous is it to own property in Costa Rica?


Imagine that it is suggested by respected Lic. Roger Peterson that to protect your home you


1. pay for the monthly review of the Registro for changes to the paperwork ...


2. Take out a mortgage on your own property so that a lien is registered that will need to be paid before the transfer ...


3. Add a second clause that requires that if the lien IS somehow paid off there is a 30 day waiting period. Enough time for you to act to block the transaction before it becomes fatal.


These steps will make it cumbersome for dishonest notaries and atty's to literally take your property away. I wrote about one example I just witnessed this year in my other message. Because if you don't keep track of what's in the registro as a routine, and the title changes hands and is subsequently sold to an 'innocent third party', buene suerte amigo/amiga ever getting it back.


I really enjoy home ownership and its challenges or I wouldn't be looking again. But here a pig farm could move in next door because there's no zoning, a new neighbor could open a dance hall with your front yard becoming a parking lot and garbage can. The govt could decide to tax you out of your CR residency status through the Caja requirment.


And while these issues add to your decision whether to buy or rent, anyone could suffer a home invasion.


Does anyone want to praise the work of the police here and their response time?


When the tranquil 42-bed resort 'Las Orchideas' in Cacao, Alajuela was held up at 10:30pm a few years ago, the tourists robbed as the thieves went room-to-room, the staff locked up, one manager got the police on the phone leaving the line open. He told the police to hurry, "they have guns!" The police waited outside the walls until the robbers left. There had been a brief exchange of gunfire and the bullet holes remian on the front wall. This story is direct from the mouths of the owners/managers who were my friends.


I lived nearby, and stopped one day with a box of doughnuts from PriceSmart, gathering up the chief and his main deputies private cell numbers, since they never answer the station phone. I offered to pay whoever I called c20,000 if I called them during an emergency and they showed up in 10 minutes or less, c10,000 if they showed up at all. When I had my 'girl problem' and locked myself inside my house they came muy pronto.


Stuff can happen here that wouldn't happen in Cleveland, so before you buy, you better learn the lay of the land.


I'm happy if I can find (another) dream home, but I will go slow, meet the neighbors, inspect the property with a qualified contractor for needed repairs, check with the muni for any possible changes to the neighborhood and for other possible defects with the subject property.


And most importantly, I will not invest so much that any sale/loss in a couple of years will keep me from ever again buying jumbo shrimp (c13,000/kg in Santa Ana) :>)


to Jesselongworth: If you want to start a discussion, state your issues. Commenting "your post is so full of holes I don't even know where to begin" is unproductive sniping and offers no insight into your thoughts. I believe a lot of people will reference this website for current opinion and I welcome a discussion that leads newcomers here arriving with eyes full of visions of Pacific sunsets some help in avoiding the rip tide.

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Thank you again for this follow-up commentary.


You have provided for us a very important synthesis of potential problems and difficulties that the expat considering buying property in CR can experience.


If nothing esle it will give the newbie expat (and others) some important things to consider before taking steps toward buying a property.


Certainly your comments here will not save everyone from rushing into an unfortunate real estate purchase or becoming nvolved in some other sort of undesirable situation.


Because of the amount of information that you have provided in the three posts you have made to this topic I have decided to PIN this thread so it will be easy to find for future reference.


Best Regards,


Paul M.

Fourms Moderator


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Marsrox; You are interested in purchasing another 'dream home' so I will not repeat any of the many reasons for purhasing rather than renting as I have in the past.

Paul; enjoy your apartment, please, but do not assume that gardening is an unimportant pass-time for 'little old ladies' like myself. Why move to a location with a perfect climate and fertile soil and not gain pleasure from watching, and helping things grow?

There are a number of steps to take when PLANNING to purchase:

1. Make a list of NEEDS and WANTS in a property

2. Research the climate; natural and man-made, of the area

3. Read the adds in the local paper and call real estate salespersons who list likeable properties

4. Send the lists #1. to the real estate salespersons who advertise in magazines and request that they call you if they have a property that meets your parameters.

5. Spend the time needed to look carefully at the properties recommended.

6. Have a lawyer help you check the national registry when you have discovered a likely property.

Many of the problems with which potential buyers have to deal can be avoided by proceeding slowly and carefully. Much like safe driving in Costa Rica. (This is not the autobahn)

Enjoy and Good Luck!

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Paul; enjoy your apartment, please, but do not assume that gardening is an unimportant pass-time for 'little old ladies' like myself. Why move to a location with a perfect climate and fertile soil and not gain pleasure from watching, and helping things grow?


Hello Annelise,


Not sure why you posted the above, but rest assured that is not my feeling at all. In fact, gardening is the one thing that I cannot do at my apartment in CR that I wish I were able to do.


I am an avid orchid hobbyist and in Florida have a large collection of them, plus a number of other plants that I enjoy, including roses, ferns, gingers, bananas, and some exotic tropicals.


Unfortunately, inside my Alajuela apartment there is NO PLACE for me to grow even any low-light plants since there's no place where I get any direct sunlight entering there except one small area high up on one wall of the kitchen about nine feet above the floor. There is one very small area around 3 by 3 feet out back over the edge of the wall of my pila (my apartment is on the 2nd floor) where I have hung a 2 by 3 foot shelf and there I have a about eight medium-sized pots of cooking herbs growing. That's it! I find it ironic that my apartment, more than suitable in every other way, does not allow me to grow any plants while I am in CR and I miss doing that while I'm there.




Paul M.


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