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While different price points in the real estate market might be seeing downward pressures…. I’d have to guess that a $2 million house owned by someone that might have paid too much for it and is currently leveraged well beyond a safe carrying level and has also suffered some other financial setbacks and medical problems is going to see more of this pressure than those that purchased at reasonable prices and are not currently in jeopardy of losing their investment.
As sad a story as it is… it’s really not your typical Costa Rica vacation home owner… or your typical expat here in Costa Rica.
I found these comments from the article very interesting….
>”Traffic has been good, but sales are down. There are many who believe the market has not hit bottom yet, and they are not in any real hurry,” he says.
Ted Jones, chief economist for Stewart Title Guaranty, believes the market’s salvation rests on people who see vacation homes more as sources of personal pleasure than financial gain.
“Many are saying, ‘We’re going to (enjoy) our money.’ … I think the second home market will see a great propensity for growth this year,” he says.<
I guess that means there’s buyers… they’re just more careful about determining REAL value… nothing wrong with that… and for those of us that ENJOY our investments…. the future looks quite nice…
Edited on Apr 15, 2009 13:21
With any investment that you leverage any down market is going to generate folks that are over-extended… the “extras” like vacation homes and “toys” are usually the first things to go! Have you seen what this economy has done to both the new and used boat and RV markets?
A prefab cement cabina would be a better option. Cost are about the same and you can use it as a guest/caretaker house when you finish your own home. More house… and nicer looking… I really love the idea of recycling the old shipping containers… but the cost and the layout really don’t have much of an appeal. I was quite surprised to see the cost… and short of getting them decked out with all the bells and whistles… they’re just big boxes with a door and a window or two!
David makes a good point on the timing issue…. chances are that by the time your application makes it’s way to any meaningful review you will in fact be collecting your SS. The problem the attorney might have with your situation is his submitting an application that on it’s face he knows does not contain the required elements (receiving SS income) to be processed. Or starting an application that has a SS document that’s out of the ordinary. I’m not sure if an immediate review is done when the application is submitted and that it would be rejected immediately.
Placing the process in motion and then having to submit your actual award declaration letter from SS when you stop working might not be the way to go. I’m sure the folks at CR immigration know what the “usual” SS income documents look like and submitting something different might put you on the radar for attention you might not appreciate.
My advice is it would be better not to attempt to submit your application until you are actually getting your SS and have the normal documents to prove it. Anything less might create problems far beyond the minor bumps you’ll have to deal with in waiting. Getting caught up in making an application when you know you’re currently NOT receiving the income you’re swearing you have might get not only you…. but the attorney in hot water… hence his response.
Edited on Apr 13, 2009 17:47
Check TACA.Com… they fly throughout Central America and beyond… great airline… and if you shop their website on a regular basis you can come up with some killer deals!
I guess from the investment standpoint… there’s going to be those of us that look at CR as a straight out business investment… and those of us that look at it as a vacation/retirement investment. While I see that there are no doubt some good possibilities in the US right now… CR makes more sense in my mind.
CR provides so many other advantages then just a business investment. That itself can not be said about many of the areas in the US.
No doubt there’s profits to be made looking at some of the US markets that have been beat down the worst. I’m not sure of what segment you’re investing in but deep pockets with the ability to ride out this economy will do well in the LONG TERM. That idea applies to all the markets out there. The US market has some real pain to go through… and besides the real estate market there some real social and economic problems to be worked out. Any concern about your area of investment and water issues?
Good luck on your venture…
grifz77… Fair enough… but I don’t think there is any prohibition about talking about worlwide real estate markets in general on this forum. I’m not looking for you to promote your company/business. Thou you might feel that Scott has unfairly addressed your posting I’m sure he’d have no problem if you have a topic to discuss that involves a comparison between the RE market in CR and some other market (be it the US) that might involve better ROI’s.
Besides, I’m sure it would provide for some great exchanges and views!
Thanks again for getting back to me!
David… I guess everything is relative… My home state of NY (Eastern Long Island) is the basis of my comparisons. Car insurance on Long Island is some of the highest in the country. And the repair cost (hourly) at the dealership/mechanic is over $100/hr!!! Homeowners/flood insurance are also WAY up there. So for us CR is a deal.
As for electric/phone… once again… LI NY has some of the highest rates in the country… so CR is once again a deal.
I guess we’d agree on some of the other expenses… it’s all relative depending on where you’re coming from!
If Jack was able to make it in Dubai… I’m guessing he’ll be thrilled with the cost of living in CR…. unless of course he’s looking to shift gears in life and attempt to live as a minimalist…
Jack… Housing rentals can be had for much less than the numbers you’re looking at. Unless of course you’re looking at high end living or a rather expensive area of CR. Utility bills (Electric/phone/water) will be less than the states. Internet is about the same… cellphone service costs are less but can be spotty in areas. Cars cost more in CR (purchase) but the annual cost (insurance/inspection/repairs) will be less. Gas is more expensive than the states… but depending on how much driving you’ll be doing it’s not a big issue. Food will cost less if you shop and like fresh local produce. Prepared and other American type foods are about the same. Dining out will be less if you know where to go and enjoy home cooked food. Labor cost are a lot less should you need to hire help.
So where are the BIG savings… taxes for one. Medical and dental care are a lot less… and the service is very good. Overall you’ll find that you’ll be able to make your money go a lot further and live very well. And that’s not even touching on the climate and quality of life.
Everyone will have there opinion… this is just a brief answer.
So how did Dubai stack up as far as cost compared to living in the US? And why the exit?
Edited on Apr 11, 2009 10:38
grifz77… Silence again when directly asked? I guess that tells me and everyone else what we need to know.
“And if you recall…I never said buying CR real estate was a bad idea…I just think there are better returns to be had elsewhere.”
Grifz77… this is the second time you’ve made a similar statement in one of your postings in the last couple of weeks about there being better returns to be had elsewhere… please stop teasing us… where might this place be? It’s time to place a little substance behind your words… be it an opinion or a fact.
I out and out asked you last time… perhaps you might elaborate this time.
Edited on Apr 10, 2009 20:24
Well said… but where in the world is it “business as usual” these days!!! I’m enjoying the change… not that I enjoy seeing folks hurt or struggling… but for those of us looking to buy that have been dragging our feet because of the constantly moving market… this is a good time! The “business” of the last few years was quite unsettling… once true value is established we can go about our lives.
After dealing with the sellers the last few years that felt as if they were doing you a favor selling to you… it will be nice to be in the drivers seat for a while!
Perhaps he wasn’t medicated at all… perhaps he just bought into the American “dream” and found it was a nightmare from which he could not awake!
The recent letter and materials sent to a local news organization which was alledgedly sent by the shooter prior to his actions would indicated the guy had some real psychological problems for which he may or may not have been under treatment for. He seems to fit the classic delusional paranoia… untreated he was dangerous… if he was medicated and suddenly stopped taking his meds he was a timebomb waiting to explode.
Edited on Apr 08, 2009 11:24
I have a simple compromise that might allow everyone to meet in the middle.
I think we can all agree that the real estate market WORLDWIDE has seen some real problems. Is the market in Costa Rica immune from this contraction and shortage of money to spend… the answer is of course NO.
Is the market in Costa Rica seeing some pain…. YES…. Are there areas that are seeing more downward pricing pressure than others…. OF COURSE! Much like California, Florida and Nevada in the US… those markets that saw the biggest (and most unrealistic) rise are now seeing the fastest decline and foreclosure rate due to the grossly over inflated prices of the last few years. There will be areas and sellers in CR that have the ability and determination to ride out this downward pressure if they have the proper financial backing and a belief that the property (or project) they have is priced correctly. And many of these didn’t see anywhere near the wacky rise that RE saw in the US! These I believe are some of the projects Scott mentions. For now they may very well be able to continue asking the same price that they were prior to this mess. Sales will slow down, buyers will be more elusive, but business will go on. I’d venture a guess that some projects might even welcome a bit of a reality check and time out to get things in prospective. Time will be the true arbiter as to whether or not they are correct in their beliefs.
This is happening in markets all over the world. Look a Dubai and other areas where real estate prices broke their correlation with reality and attracted folks with money to burn and synapses that where misfiring! Guanacaste, the beach areas, and other areas of Costa Rica will no doubt see a similar correction (although not as severe) due to this same crazed pricing. How much…. well that’s where we can debate. For many holders of property and potential buyers this is the time where REAL value is being determined rather than being based on the most recent sales price. This goes for real estate, cars, boats, “toys”, and everything else folks managed to blow their money on during the “party” of the last few years. And this is where I believe (no I’m not in the real estate sales business) Costa Rica has the advantage! Think about it a minute… look at Dubai on Google earth… does it really look like someplace you’d want to live? Yet the RE market was out of control there!!!
REAL value in this world is now undergoing a reassessment and will for the next several years. Much like the reflection that one does after a long night out partying. People are looking at was it worth it, what’s important, and what has real value in life.
Unlike many markets out there I think we can all agree that CR has a REAL advantage in this economy and in this troubled world today… yes there’s nicer places to live, yes there’s less expensive places to spend your money… but on balance CR offers a wonderful balance that attracted us all.
The site is called WELOVECOSTARICA…. and for that reason alone I’d have to hope most of you reading this will agree with at least something I’ve said.
