Investors Information

Beachfront real estate

Investing in Costa Rica:

By showing interest in property in Costa Rica, you’ve become part of a modern day gold-rush. Tens or hundreds of thousands of North Americans are actively seeking to buy and/or move to Costa Rica because of the country’s reputation for beauty, safety, friendly people, and its “pura vida” lifestyle. The Costa Rican tourist board reports than nearly one in four visitors states that they’re interested in real estate here. The rush is really just beginning, and today’s prices will seem like a bargain in ten years when prices rival those of Hawaii and exotic locales such as The Virgin Islands. To get there, they can go up ten times or more in many places.


Land prices in the area vary, depending mainly on proximity to a sandy beach, and the beauty of the view. Beachfront properties can be as high as $300 per square meter, while large farms can be lower than $1 per square meter. Generally speaking, prices are rising between 25-50% per year, although certain areas have doubled almost yearly. What’s the limit? At this point, it seems that the more expensive lots, such as beachfront, have slowed down, but we still think they’ll double over the next three of four years. Land further in the hills, however, has a long way to go before maxing out.

The southern Nicoya Peninsula, including Malpais, Santa Teresa, Playa Hermosa, Montezuma and Tambor, we think will eventually become super expensive because the natural geography of the land offers fewer “walk to the beach” and “ocean view” lots, which are the two types of land that are most popular. This natural scarcity of the most desirable real estate will lead to prices that rival those of Hawaii, or possibly higher, since it’s much cheaper to live here, and easier to get to from the east coast of the U.S.

With almost 9 millionaires in the U.S. alone, and 40 million baby-boomers set to retire in the next decade, many of whom are very hedonistic and seeking a beach to retire to, we expect prices to go to at least quadruple what they are now. Also, considering that ocean view lots in other parts of Costa Rica, such as Nosara and Tamarindo, are up to $150 per square meter, which is triple what it is here. Yet, this area has more to offer, such as better restaurants, more waterfalls and activities, better snorkeling and diving, greater variety of animals and birds, etc. Considering these factors, we think ocean view lots will eventually reach $200/m2 or more, which means each lot will be $1-$2 million, which matches Maui. These types of lots are selling for $300-$400,000 now. Another factor that makes real estate desirable in Costa Rica for retirees is that not only are living expenses very low, but property taxes are as well. A retiree who pays $20,000 per year in property taxes in Hawaii may pay 1/10th of that in Costa Rica, or less. So, retirees can afford to spend more on their land for a similar lifestyle. And despite the fact that Hawaii invests heavily in their “Aloha state” marketing campaign, the fact is that many tourists and retirees feel less than welcome there by the Hawaiians, which is certainly not the attitude in Costa Rica. One might say that Costa Rica has become the new “Aloha Country”.

Costa Rica Bargains:

Many people want something for nothing, and in the current real estate market, bargains have become more scarce because there’s no shortage of buyers, and lots of people digging up deals. The best bargains fall into one of several categories:

1. Stupid or desperate sellers: sometimes sellers want money NOW and can’t wait even a few months to get the market price for their land, and will sell at a stupidly low price. Just a few months ago, one seller sold an ocean view farm for $7/m2 when the value should have been $20-30/m2. These types of opportunities are rare, so check our website frequently. We typically put such deals on the website almost immediately. There are a few there now, and if you don’t recognize them, ask and we’ll point them out.

2. First lots in a development: sometimes a person who is creating a development will sell a few of the first lots at a greatly reduced price in order to generate cash to pay for the roads, electric lines, and water pipes. These deals are great, and again, check our website frequently to look for them.

3. Unimproved land: sometimes a seller is too lazy, doesn’t have enough cash, or too stubborn to make a few simple improvements on a piece of land or house that would greatly increase the perceived value. For example, we have a great lot for sale now that has trees blocking much of the view. If the owner just trimmed some of the lower brances on the trees, the view would be opened up underneath them and the property would sell immediately with its new panoramic view. Most buyers make emotional decisions about whether they like a piece of land or not. If you want a deal, think with your head, not your heart, and realize the potential a property may have, not what it looks like at the moment you’re seeing it.

4. Access Issues: there are areas nearby in which access is difficult. For example, the road between Cabuya and Malpais is an impassible, muddy mess throughout the rainy season, and few people would buy a property along that road when they can’t even get to it. But, this road will soon be improved and be maintained year-round. Property values on this road are often cheap, so if you’re willing to wait a couple years to have year-round access, then this land is a bargain. Parts of Santiago, and also in the mountains behind Santa Teresa are similar deals.

5. Pay Cash Now! One great way to get a property cheap is to make sure you have all the cash ready in a Costa Rican bank. Then, offer to pay the money immediately for the property, rather than going through the usual escrow with all the delays. To do this, you either have to have a lot of guts, or just make sure you and your lawyer to all your homework on the property in advance before you make an offer. Some sellers will give you a great bargain if the entire amount will be in their hands in a day or two.

6. Buy away from the beach: many people want a property right by the beach, but not everyone can have what they want. Some of the land that has appreciated the fastest in the past two years is land that’s 10-15 minutes from the beach. Some of this land has gone up 5-8 times in two years! Look in areas such as San Isidro, Santiago, Betel, or along the “Pura Vida Road” between Montezuma and Tambor to find cheap land with a short drive to the beach, lots of beautiful trees, a cooler drier climate, at a much reduced price, and in a few years you will see a giant jump in the value.

Geoff McCabe
Malpais, Costa Rica

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