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I took out the resort’s name, but it is in Jaco. They appear very desparate!! It looks like CR RE is going to get a lot cheaper. I quit looking for RE in CR about 3 years ago, because the market was crazy everywhere (even in China!!!). I’m considering a purchase, but really thinking that the bottom in CR is yet to come.
Very interesting for your readers Scott. I hope you don’t delete it.
****** email I just recieved ********
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To entice you to visit the One Jaco Resort Residences now, we have put together an irresistible offer:
Pay for a one-week stay at the regular daily price, and we will reimburse you the cost of airfare, up to $2,000 per room!
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That sounds like marketing in a difficult time to me. Unless the normal rate is $50 per night but I’m assuming it isn’t as nobody is giving anything away for free. As for trying to predict the bottom I wish you the best of luck. If you are looking for sub par property in a sup par location it might still drop some more. But if you are looking for Direct Beachfront you better grap one of the 2 or 3 deals that are on the beach because once they are gone the rest of the people are holding on. I know every sale on the beachfront in Jaco and there is less than 5 units that have sold where people have taken a loss and there might be 5 more that are out there. I would say the market is holding pretty strong if you purchased right and compared to the rest of the world. I wish you the best of luck with your search.
I’d be looking for something the mountains that just might have an ocean view. I’d rather be in the hills since it cools down at night there.
lisle55 said: “I would say the market is holding pretty strong if you purchased right and compared to the rest of the world.”
With all due respect, this is where you lose me. You must have a vested interest in the CR RE market. CR is by no means special in the world wide RE market especially at the middle to high high end market since it depends on foreigners who are currently struggling.
lisle55 said: “I know every sale on the beachfront in Jaco and there is less than 5 units that have sold where people have taken a loss…”
Trouble with RE in CR is that you can say what you want, because there is no way to verify it. If you know “every” sale, then you are part of the RE establishment and so you have a vested interest in denying the true nature of the market (buyer beware). Also, no one loses anything until they have sold so those that purchased and can afford to hold it for haven’t lost anything.
lisle55 said: “But if you are looking for Direct Beachfront you better grab one of the 2 or 3 deals that are on the beach because once they are gone the rest of the people are holding on.”
The famous buy it now or else you’ll never get a better deal ever line?
lisle55 said: “As for trying to predict the bottom I wish you the best of luck.”
I think the bottom will come and price will be stagnant for enough time to make a good deal. The bottom will last a lot longer than a day. Most people, even the slightly educated, will be able to identify the bottom for it will exist for years (many moons).
Sorry to be such a downer… it comes from my very stronger Chinese mother and father!
Again, sorry lisle55…. I’m just not wanting any advice from the RE industry now. And, if you know anyone who is Chinese, you’ll know we tend to be downers (very serious people all the time). I’m an ABC (american born chinese) so not like the generation before me, but, still, my parents rubbed off on me.
I would only buy in Costa Rica if my motive was first for enjoyment, because you love the country. Then you can buy what you can afford with little worries about predicting bottoms. Even without an MLS to verify prices you can certainly zero in on a particular location and come up with a decent idea of value. Holding for 7-10 years or more should protect against bumps (or earthquakes) down the road. IMHO speculating on a condo purchase is a very risky proposition in a small under-developed country like Costa Rica with many shortcomings in the banking sector for starters.
Certain properties do seem to trade fairly quickly, but I know of many that sit for over a year, even in beach communities. If I were looking to “roll the dice” on residential real estate I would be looking in the battered (prime/beach)sections of the US. Perhaps we are not at the bottom yet, but IMO betting on the US makes more sense than an investment in Costa Rica if you are purely looking for ROI.
I am speaking from the perspective of a small investor making a single purchase. Of course if you have very deep pockets and are simply diversifying that would be a different story as well.
I love CR and own there and bought in a prime central pacific beach community for $6 us dollars a M2. I got lucky as that price is looking pretty good. But that’s not why I bought.
I think Scott is affiliated with some very good people and if I were to make a large investment in this country, I would certainly reach out to all of them. If you don’t personally live here and have a network of trusted people, it can be like walking through a minefield trying to get honest, sound advice…even for the most basic questions.
AnnBing,
I don’t disagree with Lisle55, and I have nothing for sale. I started coming to Costa Rica in 2000 and I have seen properties out of price, others reasonably priced, and some very cheap ones. It’s been like that for all those years. You cannot compare CR situation with any of the other countries.
The first crisis I have seen with desperate sellers is when the Brothers and the Cubans fell down in 2002 (Another story) But at that time, many americans, canadians etc were found without money, HAD to sell quickly, and that crisis last about 6 months. WHY? Because those who invested were found without money, without equity and had to go back. But it was just a few people who were not so smart investing all they had in that ponzi scheme. The majority of people just swallowed their pride, and carried on.
I think the majority of people who invested in RE in Costa Rica were smarter, and what you see now are just the few ones who were caught in the economic crisis because they did not do the numbers well in the first place. That is what makes me think if you want to buy something cheap, buy now because those who are not in distress sale mode right now, will not be in the next months either.
Ticos are not in a worse situation than they were last year, and Gringos who are in a precarious situation already made their move. To my opinion, prices will freeze maybe for some «MOONS» because the stranger doesn’t have the money to buy right now. But I don’t think the economics will be as bad in Costa Rica as it is in Europe or North America.
As I said, it is just the opinion. I am very happy with what I bought, would not sell it for anything in the world and to be truly honest, I don’t wish to see a new neighbor be someone who just took advantage of the poor to buy his place in paradise, not just to enjoy it, but to make a profit out of it.
Good Luck
JoLotus.. Minuit…
I would not buy in CR or anywhere else for investment purposes. My intent is to buy a modest place for living when the time is right.
For investment, I will stick to the stock market since my stance on owning RE as an investment is that “the more you own, the more it owns you.”
I can be in and out of the stock market within minutes – the same is not true with real estate. I often see that people who “invest” in real estate for the purpose of ROI do not understand the stock market. Even with all the troubles that surround RE ownership, a lot prefer it simply because it is something they can put their hands on (stocks are too abstract). For investments, I much prefer the liquidity and simplicity of the stock market. Surely the stock market isn’t always great, people often cherry pick from and to dates to show how bad or good (which ever their purpose) the stock market is, however long term, the stock market is usually a good investment.
Considering stocks are down now, the stock market, in my opinion, is the better place to be. Even an index buy on the overall market, considering the DOW was at 14000, is a good buy. The DOW will get back to 14000 quite easily once the world’s economies pick up. No one really knows, but I doubt it will take 5 years to get to 14000 again so considering it is 9605 now, 14000 is a nice ROI and likely way more than any real estate purchase will offer in the same time period (no maintenance on stocks…. this helps too). Even though RE is down all over the world, the place to be, for ROI, is the stock market.
Well, Ann, if your objective is to purchase real estate in Costa Rica for personal enjoyment (to live in/on or just for the pride of ownership), why not just buy what makes you happy and what you can afford?
There’s an old adage about real estate (and other) values: Whatever it is, it’ worth what a willing buyer will pay and what a willing seller will accept.
It would appear that Ann is not remotely interested in Costa Rica real estate advice from people in the industry, although she’s happy to give her amateur investment advice to us about how “the stock market is usually a good investment” (Sure it is…) even though she and “no one really knows…” And then states categorically that the “The Dow will get back to 14000 quite easily.”
The Dow with 30 stocks is about as representative of the investment world as the 100 or so properties we have listed on WeLoveCostaRica.com is representative of the general Costa Rican real estate market …
Scott Oliver – Founder
WeLoveCostaRica.comI’m thinking it might be quite a long time before we see a market at 14,000! The US economy is going to be on life support for some time to come. And REAL value in the stock market these days is VERY difficult to find or justify! As for Real Estate in Costa Rica as an investment. There are some good values out there… you have to know the true value of things and take your heart out of it if you’re shopping as an investor. And there are some fire sales…. folks caught short… projects in need of cash…. and of course there are still crazy Ticos and greedy Gingos waiting (or who waited too long) to cash in with very silly off the chart prices!
Best advice… be patient… look around… keep your powder dry… and if you have the cash… be sure you remember that in this market YOU are in the drivers seat! For too many year in CR sellers were making the folks holding the cash feel as if they were doing them a favor selling to them at inflated prices! EVERYTHING is in play now as a buyer… seller financing… closing cost… and of course price! When sellers start to realize they may have missed the boat on the top of the market we’ll see more movement… right now you’re seeing some cracks in the price points out there. Not as much as many markets in the world…
As for stock market investing as compared to Costa Rican real estate… stocks have a value that can disappear in a flash… AIG…ENRON…WORLDCOM… GM…. Chrysler… so when you “hold” a stock you’re holding a promise and someone else’s dream… with real estate… you have something “real” as the name implies… and if you’ve done your homework you’ll be rewarded! Besides if the world slides down the tubes… at least you have somewhere to hang your lion cloth and grow some vegetables!
Edited on Sep 14, 2009 15:35
I think Annbing is just a whack job and apparently has no real interest in Costa Rica or purchasing here which for me is just fine. Go to China and stay there!
Ione, Why so intolerant? Can’t people say what they think without being told to
go back to their (parent’s) homeland? What’s that about?I agree with you Scott. Although most of you know my position on CR RE and its future…real estate is a relatively good hedge against inflation…and on that front…put your helmets on folks.
I’m an employee of a very large US financial institution. I work on Wall St. It is my “amateur” opinion that we won’t see 14,000 for quite some time to come (years).
Investing in Dutch tulip bulbs seems more reliable advice right now, particularly as the market has risen quickly (many think too much) after the recent slump.
If you have knowledge of history and believe tulip bulbs are also risky, buying Costa Rica real estate looks very solid if you actually intend to live in it.
As a pure investment vehicle, real estate has a history of poor but reliable returns over the long term. Triple AAA rated bonds would tend to be better and a much more liquid asset that requires no maintenance etc,.
As a short-term investment, real estate is awful (unless you have some insider knowledge). The cost of buying and selling it (aka “the spread”) is huge and can easily negate any short term profits (if they even exist at all).So buy a house if you want one, not as an investment. Now is probably a good time due to the somewhat depressed real estate market, although I generally recommend against “bottom fishing” and trying to “time the market”.
Lastly, make up your own mind. Many people have their own agenda and will try and influence you. Seek impartial advice. Most importantly of all, ignore everything I have said.
Good luck.
PP
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