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By Catherine Deshayes
Property prices are falling and real estate
developments are being delayed as the market
in some parts of Costa Rica are affected by
the global downturn. In Guanacaste province
where the real estate market has surged
since 2006 the tide has turned.
A number of highly publicized residential
developments aimed at second-home owners and
anchored by brand-name hotels and golf
courses have been delayed on Guanacaste's
Gold Coast, a 60-mile stretch on the Pacific
Ocean from the Papagayo Peninsula in the
north to Tamarindo in the south.
Holiday home sales have been reduced to a
ripple. Individuals who built or bought with
an eye toward selling have lowered or
postponed their expectations, trying instead
to earn money by renting out their
properties in a region that remains a
popular tourist destination.
But according to Christopher Howard, an
American author who specializes in real
estate, for the serious or spontaneous buyer
there are some good deals.
'In a way the downturn benefits the
Guanacaste market. Things were developing
too fast and prices were getting too high,'
he said.
But well known developments have seen work
stop. A luxury two hotel project with 300
residential units in Cacique backed by
co-founder and former chairman of AOL,
Stephen Case, has been delayed until the
economic outlook improves.
Not far from Cacique, in Panama Beach, work
had begun on La Punta Papagayo, but it's now
delayed.
In Brazilito the Azulera Resort Village, a
557-acre community Hyatt Regency and
1,000 condominiums, town houses and
single-family houses, work has halted.
Chris Simmons, Owner of ReMax Ocean Surf
Realty in Tamarindo, said vendors and
developers are cutting their prices by about
20 to 30 per cent. Looking ahead he is
concerned that when interest returns to the
market there will not be much to buy because
there are virtually no new projects breaking
ground.
Costa Rica still remains among the most
popular second home destinations for
Americans and it also has a thriving
eco-tourism markets. Experts point out that
the low cost of living and property taxes
still attract retirees who are looking for
cheaper options without too many
compromises.
One alternative is to buy land. James
Cahill, Managing Director of Costa Rica
Invest, said that buying development land
where teak is currently grown offers the
investor good prime land with the advantage
of having a commodity that is in demand.
'The teak growing on your land will provide
a good return but better than that as the
world economy recovers and more baby boomers
seek out their little piece of paradise the
value of your land will increase rapidly
giving you a spectacular return,' he
claimed.
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