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Hi all,
How is the economy in Costa Rica now? Tourism (hotel bookings) still running strong? Buyers for land still pouring in? Building still strong?
I have heard lots of rumors, like problems selling condos in Jaco, not sure if this is tre or bar talk? Also I heard lots of construction projects have slowed way down or stopped.
Anybody know something real?
Thanks all,
Jim M.Only a fool would think that CR is not being impacted by the current world economic situation. And since CR is so dependent on tourist for it’s cash flow…. and retirees sitting on fat retirement accounts as home/condo buyers… or investors with equity in real estate elsewhere building or buying… you have the answer to your question.
Construction has slowed or stopped in many places. Many “planned” communities are nothing more then dirt roads to nowhere. Developers are in a tough spot. Marinas are being stopped or replanned on a smaller scale. All the normal result of the world economy. Nothing unique to CR.
None of this should be taken a slap at CR. In many ways CR is in better shape to weather this storm. There will be plenty of people burned and the market will have a major readjustment back to reality. It’s always been buyer beware, especially in a market that was as hot as CR was. And much like musical chairs… when the music stops… someone doesn’t have a place to rest their rear!
According to the Realtors we recommend, sales have certainly slowed dramatically in all areas – The Pacific coast appears to be feeling the decline in the number of sales the most whilst the Central Valley, which is home to most business, has suffered less.
Having said that, it really is amazing that prices remain stable, there are a few desperate “fire sale” sellers but most prices have not come down at all.
With raw materials prices at the lowest level we’ve seen in a few years, I do personally know some developers who have confirmed that they will be starting up again very soon.
I also know well funded developers with excellent liquidity who never stopped…
Local banks are lending again – although at high interest rates – building firms have to build and retirees will continue to retire and look for other places to live.
Scott Oliver – Founder
WeLoveCostaRica.comPS. Where are you Jim? Not in CR anymore?
It is not just the US anymore. Has anyone checked Euro and Pound Sterling exchange rates today? The pound is at $1.39, a 33% drop in 6 months!! What % of tourism comes from the US, UK & Europe? Would expect to see stagnant tourism in 2009.
According to the Latin American Business Chronicle, Latin America in general will face serious challenges in 2009 – especially tighter credit and cost-cutting – but the region is now in better shape than it has been during previous crisis and still offers good opportunities, according to Latin America division heads of leading U.S. and European multinationals surveyed by Latin Business Chronicle.
”No country anywhere can completely escape the effects of the economic slowdown, even if that country possesses abundant natural resources or enjoys internal prosperity,” says John Slater, vice president for Latin America and the Caribbean for U.S.-based Continental Airlines.
However, several executives also argue that Latin America is in better shape than ever to face the crisis. ”Latin America is an “expert” when dealing with crises and moving forward,” says Fernando Garcia, vice president for Latin America for U.S.-based American Power Conversion (APC). “Compared with previous crises originated internally, this time it is a crisis provoked by the international contagion and not by inherent problems in Latin America. In general, Latin American economies are quite healthy and that can speed up a recovery.”
There are two key elements that will help the economies of countries in Latin America face the current economic downturn, argues Hernan Rincon, Latin America president for U.S.-based Microsoft, the world’s largest software producer. The first is that countries in the region have, and are maintaining, sufficient foreign reserves to endure current conditions. Secondly, inflation in the majority of the countries has been stable and under control. “The current economic situation is definitely impacting all industries in the region and throughout the world,” he says. “Nevertheless, Latin America has maintained in recent years good macroeconomic conditions that will allow for a faster recovery from this current environment, compared to previous crisis that have impacted Latin America.”
While there clearly are several challenges that will face companies operating in Latin America in 2009, tighter credit tops the list, according to our survey. ”The biggest challenge facing many companies in Latin America will be access to credit,” says Leo Rodriguez, president of Latin America for U.S. based Emerson and Emerson Process Management.
Do you happen to know, what the average cost to build homes (per square foot) is in the planned communities?
Hi,
I was hoping for: An Idea how is tourism fairing in the downturn? Hotel bookings? housing starts? CR unemployment? Yeah these are gingo type numbers but I would have thought there might be something like this here?
Jim
The bottom line is that building costs per square foot or meter are determined by the building contract and construction specifications agreed to between the owner and the contractor. Without careful planning by a builder who has years of experience here in CR, the costs usually end up increasing as the construction process progresses. In Costa Rica, the construction problems that can cause delays and end up costing you more money are not predictable problems anyone from another country could have anticipated based on knowledge acquired elsewhere. Additionally, construction costs vary depending on the location of the building site. I’m presently working for a client who is in the planning stages of constructing a 7500 sq. ft. luxury home in an established subdivision in Santa Ana. The current costs to build his home according to the specifications he agreed to are coming in at $82 p/sq. ft.
You can review current business statistics and information in the following articles on WLCR. https://www.welovecostarica.com/members/1991.cfm and https://www.welovecostarica.com/members/2016.cfm
Costa Rica Tourism Numbers posted at [ https://www.welovecostarica.com/members/2054.cfm ] for you
Scott Oliver – Founder
WeLoveCostaRica.com
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