Costa Rica – 2008 Construction Growth

Despite the overall drop in construction projects and personnel, the CFIA – College of Engineers and Architects, reports a 32% increase in the request of construction permits.

Olman Vargas, executive director of the CFIA, stated that in Guanacaste the requests for permits decreased, but increased in areas such as San Carlos, Cartago and Limón.

According to Randall Murillo, the director of the Costa Rica Chamber of Construction, http://www.construccion.co.cr, all petitioners that request construction permits from the CFIA do not follow through with the projects.

He also stated that during the last two months, an additional ten thousand construction jobs have been lost. This will bring the total number of construction jobs lost during 2008 to forty thousand. 153,000 construction workers are currently registered with the Costa Rican Social Security system (CCSS).

The momentum of the construction of dwellings had been steadily decreasing up until two months ago when the growth figures nearly stabilized.

For example, this September, there was a decrease of only 1% as compared to the same month in 2007; in October there was a 2% decrease according to the chamber of construction. In August, there was no change from the same month in 2007. The accumulated decrease that began in April and May of this year was 19%, according to the chamber of construction.

2008 Construction Indicators from the CFIA

During the first quarter of 2008, permitting applications increased 11% compared to the same quarter of 2007. The total number of square meters registered by the CFIA was 2,309.460 m2. Additionally, the CFIA recorded more applications for professional services by its registered members, (758 509 square meters of construction) in the month of March 2008, than during the past five years.

2008 Construction Indicators from the CFIA

Distribution of permitted construction by province:

So far during 2008, the province of San Jose is where most of the permits were applied for, totalling 686,313 square meters of construction.

Puntarenas, Heredia, Guanacaste and Alajuela, in that order registered application increases from 2007.

Type of Construction Permitted

The majority of the permits granted (54%) were for housing construction, followed by commercial construction (22%).

The Costa Rican financial sector has reported that the index of monthly economic activity (IMAE) as calculated by the Central bank of Costa Rica (BCCR), indicates that the tightening of credit implemented by the national banks is the primary cause for the decrease in the construction sector. Additionally, the economic crisis in the USA has been the contributing factor causing many construction projects to be put on hold.

Written by Tom Rosenberger. With more than 25 years of homebuilding experience, 15 of which have been in Costa Rica, construction consultant Tom Rosenberger knows the ins and outs of building and remodeling a home in the Central Valley area of Costa Rica.

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.