Atenas Real Estate Market Update – March 2009

What sort of decline/increase have you see in the number of potential buyers who have contacted you in the last six months in comparison to the previous year?

We have seen a steady supply of potential buyers over the last six months. I would say it is about on par with last year, however it has resulted in less sales. It seems many clients are really just getting a feel for the market here in Costa Rica, possibly because the market in North America is so uncertain it has given them pause when making decisions in Costa Rica.

The clients seem to have slightly different motivations this year – claiming to be seeking not just a retirement or a vacation home, but also an escape property if things deteriorate further in the US and around the world. Apparently, the benefits of Costa Rica offer a secure location from the current economic mess.

How has the number of sales declined or risen in the last six months in comparison to the previous year? Sales have slowed compared to last year. This is to be expected as credit has tightened and average buyers have lost upwards of 50% of their 401K or retirement in the US stock market.

What is the easiest real estate sale for you in your area right now? The high-end clients ($400K+) are arriving in larger percentages compared to last year. It seems that they have weathered the economic crisis better than most and possibly more eager to escape the floundering system in the US.

Where do land prices stand now in your area in comparison with this time last year? Land prices have remained the same, although some sellers are considering creative terms for the first time.

Where do finished home/condo prices stand now in your area in comparison with this time last year? Some home prices have been reduced based on individual seller’s motivations. The typical reduction is around 10% off the original asking price (which was sometimes unrealistically inflated to begin with).

American sellers who have US investments and US real estate feel more urgency than the average seller. There has definitely been an increase in offering creative terms as institutional lending as slowed and become more expensive.

What sort of real estate product is currently available in your area? Our area of Atenas is almost exclusively single family homes on rather large lots. The majority of these homes are priced between $250K – $350K.

What are you lacking? Atenas is lacking in a healthy supply of $400K+ homes. There are some high-quality homes in this price range, but not a huge selection.

Is there an oversupply of any particular product? There is not an over supply of anything in Atenas, but if I had to choose the most competitive sector, it would be premium building lots in gated communities with an average price of $150K.

Where are the best opportunities right now in your area? The best opportunities can be found in homes below $300K in gated/private communities. Many of these sellers are motivated and good deals can be found under market value and with creative terms.

How do you feel the real estate market will perform in your area for the remainder of 2009? Our calendars continue to be filled with prospective clients and we anticipate a steady (or flat) sales year.

We are lucky because Atenas is a very attractive retirement location which is still a viable market. In other words, the Atenas market has never been driven by investor speculation like many areas along the coast, and the speculator market has seemed to slow tremendously.

I suppose the global economy may also have some effect on the market here if things get much worse globally. However, the argument can be made that the worse things get in the “developed” world, the better paradise will look in Costa Rica.

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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.