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Is the Real Estate market cooling revisited

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The Costa Rican real estate market has stopped moving for the last year. Just as in the US 2 years ago. As I have said for the last 2 years, Jaco will crash and hard. The rest of Costa Rica will follow the US real estate markets. The B&Bs will be replaced [as a % of market share and tt $ from end users] with hotels and hostles. A new airport down south in the next 10 years, give me a brake, 20 years 50/50. There are good real estate investments anywhere, you just have to look.

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[edit]

But a good example is in Panama where the cost of living is much higher than in Costa Rica. That did not happen over night and they use the US dollar which inherently drives up costs. But I agree, the cost of living increases will lower the demand from the working class retirees.

 

I must disagree with that statement. Panama is not higher than Costa Rica, it is cheaper. Almost everything is cheaper in Panama, at least in the north-western part where I went, and from what I have read on other forums, Panama is cheaper all over. (I'm talking cost of living, not real estate. I think the real estate in Panama is about the same if not higher. But the cost of living is much lower.)

 

But yes, I agree that if the cost of living in CR begins to approach the cost of living in the USA then Costa Rica will be less attractive as a destination for boomers.

 

 

[edit]We live in a new Tico style home with on-demand hotwater in the shower only. The shower is located in the only bathroom in the house. We do not have a dryer for our clothes - we hang them up like the Ticos. We do not have a dishwasher, AC, and we rely on only one car (a luxury here, but a huge change for our active family). Our simple life allows us (family of 4 w/ one more one the way) to live for about $1000 - $1200 per month.

 

Pura Vida!

 

So this is proof then that Costa Rica is NOT approaching - at least not yet! - the cost of living of the USA. A family of 4 simply cannot live well at all in the USA on $1000-1200 a month. So even if the cost of living in CR goes up, say, 33%, it will still be attractive to boomers who cannot afford to retire well in the USA.

 

You do make a good point though, that if one lives like a well to do American and has a maid, a gardener, a pool and washer dryer and central air and 2 new cars and so on and so forth, then yes, it will cost nearly as much to live in CR as it does to live in the USA. The difference is 2 things:

1) if you are willing to live as you say you do, "like a Tico" (though I'm sure that's an exaggeration, I'm sure even on $1200/month you live much better than most of the Ticos around you!), you CAN live much cheaper than in the USA. And:

2) one can still buy property and homes in Costa Rica MUCH cheaper than a similar property and home in the USA in a decent area. For example, I know that a nice home in the Central Valley can be bought for $100k. Once that home is paid for, the family can then live in it for - like you say - $1000-1200 a month. In the USA one cannot generally buy a "nice home" for that price, nor can one live well on $1000-1200/month.

 

When is the last time you were in the states? While costs are rising in Costa Rica, I guarantee you they are rising way faster right now in the USA!

 

Which all goes to say that in my opinion, I still think CR is a bargain in real estate and homes, and so the boomers will continue to choose it to retire.

 

As to tourism, yes it is still as strong as ever. The problem is that everyone and his brother has gone down with the idea of having a hotel or restaurant or bar, and there is only so much to go around, especially in the green season. Simply put, there are now too many hotels and restaurants for tourism to support.

 

Just my 2 colones.

Edited by Sam Ramon

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My main concern impeding the idea of house purchase in CR is squatters issue.

I am planning to be only part-timer in CR and the risk and cost of hiring a caretaker are discouraging.

Maybe, this matter is better in Panama?

I've also read crime volume is lower in Panama due to American force presence?

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In the "nicer"/smaller latin american countries, you will find the types of crime for the most part about the same. According to the CIA country profile Costa Rica is more safe. I have spent time in every country in North and Central America as well as most in the south. There are very few places I feel unsafe unless I'm doing something stupid. IE: You don't spend time down town in citys late at night. You don't go out drinking alone. Keep an eye on your stuff. Don't leave a lot of money/valuables in your hotel safe. Keep your time in tourist areas to a minimum. And yes Panama is cheaper.

Edited by sabo941

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My main concern impeding the idea of house purchase in CR is squatters issue.

I am planning to be only part-timer in CR and the risk and cost of hiring a caretaker are discouraging.

Maybe, this matter is better in Panama?

I've also read crime volume is lower in Panama due to American force presence?

I don't think the issue of someone using your house while you are not there is substantially worse in either country.

 

I think the thing to do would be to rent the house out, have an attorney draw up a lease, and go down and check on it twice a year. Ideally you should have someone there you can trust to watch over it, at least look in on it once a month or so.

 

Depending on whether you're buying something out in the boonies or where other gringos live, the issue of squatting may be much less than you think. You could just ask a neighbor to look after it... call you if anything funny goes on...

 

But the bottom line re Panama vs. Costa Rica is this:

You HAVE TO GO THERE and live for a month or more, preferably 3 months or more, and find out which you like better, and narrow it down to which area you want to live in, not only which country, but which state and which town or nearby town... Even the town makes a big difference... One town may have a lot more crime than another... One area might get a lot more rain and wind than another...

 

I was VERY interested in Panama until I went there. I did not like it one bit. That's just MY opinion. I know some love it there. But the places I went and people I met there turned me off to it. (I don't mean to imply that all the people were bad - in fact I met some very nice ones, too. But in general I just like Costa Rica a LOT better!

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Hello, just wondering...........as the sub-prime and credit crisis continues to unravel in the the US, has there been any change in the CR real estate market recently? Change as in prices going down, leveling off, or still rising? We are looking at investing in retirement land in the CV. Thanks for any insight. xpat

 

Good affordable land in a nice area will always go up in value - up to a point, at least.

 

Look how high prices went in the Arenal area! And it's windy and cold and rainy up there!

 

My prediction is that as more and more boomers come to Costa Rica, more and more will begin to buy retirement homes or land for homes, there. As to prices, no one can predict, but I can't see them coming down too much in most areas unless they've already gone up way too high (such as Arenal)...

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