How I earn 20% per year with my Costa Rica Investments. Here is the kind of rental property I search for in Jaco Beach along with a few tips that I’ve learned along the way.

Location:

It makes it easier to rent a property in a location that is close to the amenities that tourists want to explore. Here in Jaco that means that you need to be near or on the beach and within walking distance to restaurants, pubs, markets and nightlife.

It is still possible to be successful when renting a property with a poor location but you better be really good at marketing. Another location mistake is when a property is too close to a bar or nightclub where loud music will irritate renters and result in negative reviews.

Low Home Owners Association fees:

When purchasing a condo, high HOA fees will cut into your return on investment. I have seen owners in properties with high HOA fees able to make a healthy ROI but I tend to favor HOA’s that run the show themselves and pinch pennies.

Look closely at what is included in the HOA fees because sometimes the fees may seem high but they may include internet, cable, water and other additional items that you typically don’t see covered in a normal HOA in North America.

Electric Bills:

Electricity in Costa Rica is expensive and with a year-round warm climate on the beach, renters are going to consume a lot of power by running the air conditioning. Watch out for buildings that have inefficient central air systems that can lead to monthly bills topping $1,000.

Ask your real estate agent to provide several months’ worth of electric bills for periods that are heavily occupied. In my rental properties I typically have 2 energy efficient mini split type air conditioners, a refrigerator with inverter technology as well as LED lighting throughout and my highest electric bill I have ever had is $170.

Management Restrictions:

Some condo developments will mandate that you use their management company or pay them a fee even if you manage the property on your own. Others will require you to use their maid services in which case you may end up paying up to double the price of a maid you can find in town.

Ask your real estate agent to disclose any restrictions that the association may have in place.

Here are a few tips that I will share on how to fill your property with renters.

Advertising:

Not only do you need to advertise on the right websites such as www.airbnb.com, www.vrbo.com and www.flipkey.com but it is also essential to have professional photos with personal touches that make your property “pop out” of the webpage.

I see owners painting with bright colors or including fun extras such as an espresso machine to entice renters to click on their listing. Personally I make the cabinetry in our rental condos look like weathered wood and it seems to be a hit online.

Good reviews:

Success when renting your property will be directly proportional to how good your reviews are. To garner good reviews, it is important for renters to be comfortable with a good mattress and pillows as well as nice towels and a condo/house that is fully stocked.

It is also important to make personal contact with the renter either by the owner or property manager and to provide recommendations on the best activities in the area, where to shop, the best restaurants, etc.

NO BUGS! Costa Rica after all is a rainforest and bugs do exist so we fumigate and make sure the property is clean for our guests. Your review will not be very good if the guests write about a cockroach crossing their dinner plate. A wise owner once told me that it takes 100 good reviews to drown out 1 bad review.

Some owners struggle to get their first 3-5 reviews so in order to get your first few renters to book your property, you will probably need to drastically reduce your price by as much as 50% off the normal rate.

I have seen one owner start his marketing with his listing description stating, “50% discount to search for 5 star reviews.” Once you have 3-5 glowing reviews then you should be able to raise your rates up to the market norm and rental inquires tend to snowball from there.

Response time:

In today’s world renters have immense options at their fingertips so it is imperative to respond within hours or even minutes to rental inquiries or else they will search elsewhere.

Most rental websites now have mobile applications that send you notifications when you receive a rental inquiry and you can respond right there on your phone.

Manage your property yourself to maximize profits:

Managers typically will charge you 20% – 35% of the rental income if they procure the renter and that will really cut into your profits. Therefore, by finding the renters with your own marketing you can really maximize your return.

If you are not living in Costa Rica, then you can hire a manger to simple check in your renters for which they will charge a nominal “key fee.”

If you are exploring income producing properties on the Central Pacific Coast of Costa Rica then contact me today to help with your search!

For more information about condos, homes and land for sale in the beach town of Jaco and surrounding areas please contact our Recommended Realtors in Jaco Shawn Fletcher and his wife Hannah Fletcher
 using the simple form below: 
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Andrew Makarik

to@welovecostarica.com

Andrew Makarik is the main editor of WeLoveCostaRica, a fan of this sunny country. He is also a loving husband and a has a lovely daughter. By being a devoted family man and the biggest Costa Rica fan, he wants to make more people feel at home there. WeLoveCostaRica unites people and helps them find new home or a new travel destination. This website is a friendly community where everyone can find not only information, but also new friends and travel pals. Andrew is also passionate about IT and programming, so he himself maintains a friendly atmosphere in this cozy environment of WeLoveCostaRica.com.