Properties in Costa Rica Blog

by Rod Martin

Bandera Azul Ecológica… sounds exotic, doesn’t it? Well, it is exotic in a pristine tropical beach kind of way. Bandera Azul translates to English as “Blue Flag” — a designation awarded annually by the ICT (or the Tourism Board in Costa Rica). Eighty-nine beaches received at least one Bandera Azul, while some received an additional two, three, and even five stars for exemplary status.

Inspired by a similar program developed in Spain in 1985, the “Bandera Azul Ecológica” is intended to curb the negative impacts of increasing tourism and population by helping the local community to protect the beach environment and limit pollution. Costa Rica’s version was started in 1996, and 10 beaches received a blue flag designation that year. In 2004, an executive decree was made that clarified and organized the various government institutions to better manage the program. That foresight to protect one of its most precious attractions (clean beaches and water) is part of the reason why Costa Rica is booming now. Over 2.5 million visitors came to Costa Rica in 2014 (not to mention an influx of new coastal residents), and eco-tourism is one of its fastest growing sub-sectors.

For those who like the specifics behind a catchy headline, the beaches are evaluated on seven different criteria:

• Quality of Seawater (35%)
• Quality of Water for Human Consumption (15%)
• Quality of Sanitation, which includes garbage (10%)
• Domestic Sewage (15%)
• Industrial Sewage (5%)
• Environmental Education (10%)
• Safety and Administration (10%)

If the beach earns at least a 90% rating, they are awarded a Bandera Azul. In addition, multiple stars are now awarded if the beach community makes an extra effort in areas such as safety in the form of lifeguards and signs announcing “heavy surf/rip currents”, toilets and showers, bins for trash and recyclable items, and environmental education, among others.

Three beaches received a 5-star rating—Matapalo and Punta El Madero in Northern Guanacaste, and Playa Blanca on the Central Coast. There were three beaches within the southern Pacific zone of Costa Ballena that received blue flag ratings—Playa Dominical, Playa Arco, and Playa Hermosa – a beach that now has designated trash bins and lifeguards thanks to community initiative.  Those lifeguards have saved 30 people from drowning in recent weeks, so safety is an ancillary benefit to a community. House hunters even base their searches using this Blue Flag criteria. If you are one of those seeking pristine and protected beaches, check out both our Dominical and Tamarindo listings.

Last year, the Costa Rican Times reported “[…] more than 90% of the beaches in the Costa Rica have minimal pollution levels, with little to no risk to human health.” This is good for beach-goers and for everyone who will benefit from tourism in the years to come. So, if you are planning a trip to Costa Rica in the near future, don’t forget your beach towel and your sunblock. The water is warm and the tropical beach experience is definitely part of the pura vida.

As a real estate company trying to provide a quality service in the main areas of Costa Rica, we are very interest in the development of the market in Dominical.

Dominical used to be a fishermen town, according to 2011 government´s census the Bahia Ballena´s population was 3306 people and 500 of them were permanent residents of Dominical. Known mostly for its big waves, the beach is a surfer´s paradise but with time it´s becoming more appealing to potential buyers who want to own a vacation home or become permanent residents.

An article recently published in the New York Times and written by Kevin Brass points that Dominical´s real estate market is experiencing a rise. Joshua Kanter, one of our real estate agents in the Dominical area was consulted for this article. He was asked about the impact that the new paved road finished in 2010 had on the market “Bad timing” said Josh “… you could make an offer for 30 percent off and get it”.

The 2009 recession came affecting all areas of real estate and Dominical was no exception. Properties were selling for 30%, 40% and even 50% off their original price. Home owners were selling their properties abroad to avoid losing their homes back in their country. Most of the buyers in Dominical are American and they had to leave Costa Rica.

We have experienced an increase in the sales since 2012, and is has gotten better every year since, allowing us to think that this area is developing rapidly and attracting more buyers every year.

The area´s natural resources and tourist attractions, not to mention the proximity to the Whale´s Tale, one of the most famous attractions of Costa Rica, make this small town a buyer´s paradise.

by Andrés Murillo

It’s no secret that Costa Rica is quickly becoming one of the top destinations where expats from United States, Canada and Europe want to buy property, either as a vacation home or as a full-time residence. But although Costa Rica is a relatively small country, its coasts, cities and beach towns are as diverse as can be, leaving many prospective property owners wondering, “Where should I buy?“.

Truthfully, it’s hard to go wrong when buying property in Costa Rica, but through the years people has discovered what we consider the prettiest, most idyllic beach town, located on the Pacific coast of Costa Rica, near the international airport and close to a seemingly endless list of incredible eco-tourism opportunities. Tamarindo, Costa Rica, is being recognized as the best beach town in Costa Rica to buy your vacation rental home.

Let’s clarify that vacation rental home, what we mean is that you can buy a property in Tamarindo, Costa Rica primarily for your own vacation use, but also rent that property to other vacationers when you’re spending time in your home country… You can actually enjoy your property for vacations PLUS it is paying itself and even better: it is generating real income after expenses!

Here are just a few of the main reasons why owning a vacation home in Costa Rica will not only provide you and your family with unparalleled entertainment, but is also an extremely sound investment in terms of resale:

– It’s close to Liberia International Airport. At just 45 minutes from the international airport in the city of Liberia, Tamarindo is easily accessible. Finding a shuttle, a rental car or a taxi to take you from the newly renovated airport to your doorstep is not only a breeze, it’s very affordable.

– The tourism is unmatched. World-famous waves, beautiful estuaries, dormant volcanoes, miles of clean beach, great shopping, excellent food and outdoor activities are right at your doorstep. Tamarindo is one of the fastest-growing towns in Costa Rica, touristically speaking, meaning you’ll never be in short supply of incredible experiences to take advantage of.

– A return on investment that’s virtually guaranteed. Anyone from this town will assure you that land values in Tamarindo have increased steadily over the years. It’s almost unheard-of that a property might sell for less than its purchase price. Tamarindo is a highly desirable place to live and vacation, and for you that means resale prospects.

– Strong vacations rental market. Tamarindo has one of, and maybe the, strongest vacations rental market in all the Pacific Coast… That said, you could expect an excellent return on your investment while you can also enjoy the property with your family and friends. Depending in the property and its location, properties can be returning between a 4% to a 10% after ALL expenses (property taxes, HOA fees, utility bills and maintenance expenses).

Key to all is: 1. Having a proper marketing program for your property and 2. Hire the right property management company – Ask for advise and we will provide it.

– There are incredible deals to be found on vacation properties. Despite a spike in popularity over the last dozen or so years, land values in Tamarindo are fairly low, making it a very viable option for homebuyers looking to purchase a second, or vacation, home in Tamarindo.

– The variety is endless. Tamarindo housing types are as varied as any town or city. Tamarindo is home to multi-million dollar estates with panoramic ocean views, luxury ocean view condos, and quiet homes located off the beaten path. You’ll likely find that whichever type of vacation home suits your tastes, the prices will compete with anything you might find back home.

– Great people and excellent infrastructure. Costa Rica is anything but a third-world country. Instead, it is very well developed, with excellent roads, great cellphone reception, and reliable electricity and water service – especially in Tamarindo.
Further, the people who live in Tamarindo, both the locals and the expats who have already made their full-time or part-time homes here, are extremely friendly and welcoming to newcomers. In Tamarindo you can find a real multicultural mix with residents from ALL over the world living in this small beach town.

Once you see the supreme natural beauty that Tamarindo has to offer, we’re certain you’ll be as convinced as we are that it’s by far the best place to buy a vacation property in Costa Rica.

Contact Properties in Costa Rica today so we can begin finding you your dream vacation home in Tamarindo, or wherever you’re dreaming of.

Medical tourism or health tourism, currently has a dual function for a large percentage of the population in developed countries, as the possibility of surgery and medical treatment at a lower costs that otherwise they could not afford. On the other hand is a source of income for countries that offer the services. As PROMED (An organization founded in 2009 to promote and regulate medical tourism in Costa Rica) indicates it is a possibility for 49 million Americans that do not have health insurance and 108 million who do not have dental insurance, a situation that is similar in other European countries.

This represents an interesting opportunity for countries like Costa Rica where the cost of medical treatments represent a third of the United States. Also the quality of Costa Rican medical professionals and excellent hospital infrastructure also plays an important role. It is estimated that the country receives about 100,000 tourists each year who go through some type of medical procedure.

Medical tourism or health tourism is a new way to attract visitors, where medical services (surgeries, medical checkups, rehabilitation) represent the main attraction but also mean another set of related services like lodging, transportation, recovery and nutrition. In other words it’s not just health care and lodging, but also the enjoyment of the country and its numerous attractions.

Another key factors are the well trained doctors and the prestigious government and private universities training all these future doctors. In fact, the need to provide a quality health service and guidance is what led to the creation of PROMED, which aims to find the positioning of Costa Rica as one the countries providing world class medical services that go hand to hand with the tradition of Costa Rica as a warm welcoming country with lots to offer. All this will be possible by joining efforts between the Costa Rican government and the private sector.

There is a special interest from the governement and private institutions in promoting medical tourism in Costa Rica, and the advantages of the country are evident.

Source: PROMED

Costa Rica is in the top 5 of best countries to retire to, according to International Living Magazine. They did a deep study compiling information from correspondents from all over the world.

The quality of life in Costa Rica , founded on security, political and economic stability, access to primary health care and the natural beauty, mild climate and the warmth of the population, make Costa Rica a very desirable destination for retirees. Army-free since 1949 makes us stable and peaceful.

According to the US State Department there are approximately 50,000 US citizens living in Costa Rica at the moment. After decades of working hard and saving for their “golden years” many North Americans and Europeans choose our country as their home.

Most of them come looking to live near the coast, but because of our variety in natural beauty many expats also look to live in-land. Places like Atenas and San Ramon are very popular between those who want country living surrounded by green sceneries.

Most retirees choose our pristine beaches as their home, beach towns offer all necessary facilities along with the benefit of colorful sunsets and warm waters year round.

Costa Rica offers everything from Caribbean and Pacific beaches (Jaco, Los Sueños, Manuel Antonio, Dominical, Tamarindo, Nicoya Peninsula, Uvita etc.) to lush rain forests to towering volcanoes. More than 10% of the country is protected national parkland, and it is one of the most biologically diverse countries in the world.

No wonder we are called the “Land of Pura Vida”.

by Rod Martin

A few weeks ago, Costa Rica’s high court ruled that portions of the law introducing the tax on corporations were unconstitutional.  We continue to receive many questions from clients asking, “Do I have to pay the corporate tax for 2015?”  It’s a question that deserves a clear answer.

Investors and residents often buy property, automobiles, boats, and even businesses and put them in a Costa Rica corporation.  For those new to Costa Rica real estate, you cannot use your corporation (e.g., an LLC) from your home country.  It has to be a Costa Rican corporation.  For larger groups or multiple investors, the Sociedad Anonima (S.A.) may be a good choice as it requires two active officers, with at least one share each.  A Sociedad de Responsibilidad Limitada (S.R.L.) is an even easier option, as it only requires one shareholder although dividing shares among two officers is common.  Costa Rica also allows you to own property, as a foreigner, in your personal name.  Many people ask why bother owning anything in a corporation, and a few of the benefits are:

• Limited liability; as the S.R.L. suggests, the shareholder are only liable for their share of debt or assets within the corporation.
• Estate Planning; passing shares on to family members.
• Income; taxes are paid as corporate income instead of personal income.

Ley 9024 (the Corporate Tax Initiative) was passed in 2011.  Many investors (especially developers) with multiple corporations were forced to make changes to their portfolios.

Each corporation can either be active, which means a business entity that is registered with the Hacienda de Tributacion (National Tax Department) or or inactive, which is simply a dormant corporation with no business or income tax component.  For active corporations, shareholders are required to pay an annual tax of 200,000 colones (approx. $380) and approximately 100,000 colones ($180) for inactive corporations.

The High Court Repeals the Corporate Tax

A few weeks ago, lawyers persuaded the High Court to rule that the tax was unjust for two main reasons.  In Costa Rica, when major changes are made to a bill passed by law makers, the changes have to be advertised in the official newspaper of Costa Rica, La Gaceta.  The second reason it was repealed was that large and small corporations pay the same amount.

Since over 30% of corporation shareholders already paid the 2015 tax, the high court decided their ruling will not go into effect until 2016.  Many lawyers believe this will give the legislature time to re-announce the corporate tax bill properly in La Gaceta before the fiscal year of 2016.

The bottom line is… Yes, you have to pay your corporate tax for 2015.  The longer you wait, the more interest you will have to pay.    If you have any questions about this topic and its tax implications, please contact your lawyer in Costa Rica.

The first thing that we want to do after we decide to finally take some time off our routine and go on vacation is: the right place to stay.

So, now that you have chosen Costa Rica as your destination, where do you want to stay?

This is probably the most important decision you will have to make before going away on your so well deserved vacation. You have to make sure you make the right one because if you choose badly it can turn your dream into a nightmare.

In the last few years a new way of hospitality has developed in Costa Rica, home vacation rentals. Instead of going with the traditional option and staying in a hotel, vacationists from all over the world choose everyday to come to enjoy our beautiful country and stay in a home.

The options? enough for every budget and taste. With an inventory of approximately 4,000 vacation homes, we can offer our visitors condos, beach luxury homes, and mountain retreats.

The most popular properties are those close to the beach, of course, who doesn´t want to enjoy perfect warm weather by the pool of a luxurious home with all the amenities at the tips of its fingers?

So, choose carefully, make sure you look at many options and pick the one that you are confident with. There are many companies and people working in this business that know what they are doing. Use their knowledge and expertise to help you make the right choice. Once you have taken this step let yourself enjoy, we are waiting for you!

by Rod Martin

Costa Rica faced many new events, both inside and outside of the real estate realm in 2014. The country elected a member of the new political “party of the people”, Luis Guillermo Solís to presidential office. The entire country celebrated as the national fútbol team reached the Quarter Finals in the World Cup. And the real estate market finally showed hopeful signs of life due to foreign investment.

Then & Now

The coastal real estate ‘boom’ was just beginning in 2002. Tamarindo was still a small, sleepy beach town, and the Costal Ballena in the southern zone wasn’t even on most travelers’ radar. Manuel Antonio was as far south as most people ventured, mostly due to terrible roads and infrastructure. Even today, anyone looking for all inclusive resorts and sky-rise condos stick to the northern Pacific area of Costa Rica.

As the popularity of Costa Rica grew, home and land prices did as well. Unfortunately a downturn was just a few years away, and sellers chased the prices downward for about five years. Properties sat on the market for years – some are still there waiting for the prices to bounce back up.

Raw land prices are still off by about 50% from the peak in 2008. This is great news for buyers looking to invest in an ideal piece of paradise. There may be a slight uptick in List Price, but the main difference we’ve noticed is that most sellers aren’t taking 20%+ off their list price. Sales price averaged 13% off list price, and that number dropped to 12% in 2014. We expect it to move toward 11% in 2015 and here is why…

Clearing the Clutter

Many of the big ocean view properties have sold. This is due to two main factors including increased US investor interest and Costa Rica publicity. This small country has been featured in a number of magazines, travel channels, publications, and blogs in the last year.

This growing activity means a lot of properties have sold, but there are still plenty of great deals on the market at a variety of price points:  High Ridge Ocean View with No Restrictions for $199,000, and River Runs Through It  just reduced to $299,888… to name a few.

Houses, especially those with modern architecture and contemporary design have been the hottest commodity in Costa Rica. Many investors do not want to deal with the stress and uncertainty of building in a foreign country, and there are a number of beautiful homes that could be used for vacation or rental purposes. While expectations and timelines may have to be adjusted for construction in Costa Rica, there are plenty of talented architects, engineers, and construction managers that are available to build your dream home. As people become more uncertain about ‘first world’ living, we have seen many people from all walks of life, with a wide range of budgets, invest in raw land with the idea of building slowly and steadily in the coming years – securing a place to escape if things really turn bad up north.

Because of the factors mentioned above including foreign investment, Costa Rican publicity, and the challenges that many countries (specifically the US) have been facing, we believe the real estate market will continue to grow, albeit slow and steady. The Costa Ballena in the southern zone looks to be a sought after region, although the National Parks, lack of an international airport, and slow paced way of life should preserve the area, including waters, forests, and wildlife, for many years to come.

The Future

We are excited for whatever 2015 brings – it’s hard not to be excited when you’re living in pura vida paradise!

“Without friends no one would want to live, though possessed all other goods […]; because what good is this kind of prosperity if it is deprived of the power to do good, to be preferentially exerted and more praiseworthy manner regarding friends? ”
Aristotle, Nicomachean Ethics

Friendship makes life easier, as said by Aristotle, and also makes us happier. The data was provided by Burt years ago with his study of friendship and correlation with happiness. When a person claimed to have five or six friends to share their problems had a 60% greater chance of saying that he/she was very happy. Therefore, the art of cultivating friends is one of the skills that although is not always teach to helps us to face difficulties and savor the moments shared.

Friendships also rescue us from corrosive loneliness, and makes us live longer and better quality of life. Is estimated that a quarter of Asian people say they feel alone. This is the conclusion of a study by the Australian Flinders University. For 10 years they analyzed the social relations of 1,477 people over 70 years old and it was correlated with longevity. The conclusion is very revealing: those with more and better relationships with friends, not with family, came to have a better chance to survive. Therefore, friendship is also an elixir of youth.

But beware, friendship is an art and an experience that relies on generosity and to look at the other person with kind eyes. Friends care for us and protect us even our own criticisms. Why do we call friends when we are feeling down? Because they are the ones that can connect with the kind side of us that even we forget about ourselves. This doesn’t mean that friend won’t confront us or will always agree with us. Otherwise, it isn’t a true friend. As Josep Pla said, in life “there are friends, acquaintances, and people we say hi to”. With friends you we show our true selves with no fear of being judged, and with acquaintances we share superficial conversations, though of course sometimes necessary.

Friendship doesn’t get eroded over time. We can reconnect with an old friend after years of not having any contact. That’s the magic of friendship. It‘s woven of threads that gives meaning to our lives.

Recipes

Take the Burt test: With how many friends can you share an important problem? If they are more than six, you’re probably a happy person.

Check your calendar and think of how much time you spend with your friends. If you think it’s insufficient make plans to be closer to them.

Surprise a friend with something nice: a gift, a phone call, a visit … this will make you feel good.

The small coastal town of Uvita de Osa receives this month`s spotlight because it rests at the center of the desirable Costa Ballena and the amenities it provides have made it a vital part of day to day life in the area.

Uvita (meaning “Little Grape”) is home to the Marino Ballena National Park, which was established in 1989 and is known for its famous Whale`s Tail sandbar formation and the yearly migration of Humpback Whales. Over the decades, development of Uvita has been slow, allowing it to become part of a biologically diverse wildlife corridor and maintain an authentic Costa Rican appeal. Today it has grown to become the commercial center for a 30km stretch of coastline, with well established businesses which provide reputable services to its residents.

What Kind of Services Can Be Found in Uvita?

The banking options found within Uvita are a big factor which make this small town the center of day to day living in the area, these include the Banco Nacional, the BCR (Bank of Costa Rica) and the Coopealianza. As well, the quality medical care, provided at the two private medical clinics, the two dental clinics and the two pharmacies, is very important since the nearest hospital is located in Cortes, 30 km away. The local veterinary clinic provides full care services (including x-ray) for Fido, feline or feathered friend.

In Uvita you will find reputable lawyers, accountants, home builders and landscapers. Important products are sold at the pool supply stores, the paint store, the hardware stores, the auto parts store, and the home appliance stores. Important services are provided by the local print shop, the glass company, the electrical shops and the long standing Uvita Information Center, with tour/accommodation bookings and mailbox services. The two family owned BM supermarkets provide you with all the edible necessities one may need. Not to be missed is the Saturday Farmers Market, with organic produce, baked goods, whole food products, handcrafted jewelry and artisan crafts.

Uvita is home to a number of dining options, with some being long time favorites of visitors and residents, like The Dome Drive Thru, Restaurante Marino Ballena and La Fogata. One will also find fresh bakeries and a number of local sodas serving delicious typical Costa Rican dishes.

Natural Attractions and Community Initiatives

Enjoying the natural attractions, like walking the Whale’s Tail at low tide, offer unique experiences which you won’t find anywhere else. The beauty of the surrounding rainforest and Marine Park are enjoyed by way of the renowned ATV, horseback riding, hiking, diving and boating tours. Surf lessons are provided by experienced instructors and the surf is primed for beginner to intermediate surfers. Yoga studios feature classes for all levels, as well as certification courses. The Whales and Dolphins Festival in September features special tours to observe the yearly migration of female Humpback Whales, whom travel to the area to birth their calves. Uvita has played host to the Envision Festival since 2012, this international music and art festival draws thousands of visitors and highlights the raw beauty of the area.

The mix of locals and expatriates within and surrounding Uvita have developed a mutual appreciation for the town and the natural beauty of the area, in such a way that local initiatives to better the community are constantly evolving. Take for example Pueblo Alegre, a collaboration between residents and business owners to “paint the town” and work to make Bahia Ballena and Uvita an enjoyable sight for all. Volunteer organizations like Domestic Animal Welfare Group (DAWG), continue to make a positive impact on the community, while fundraisers regularly bring people together for a variety of causes.

People from all over the world have relocated to the Costa Ballena and no doubt they would all agree that Uvita plays an integral role in their day to day living. The surrounding mountain ranges are full of waterfall and river properties, quiet communities and stunning views of the Whale’s tail. For anyone looking for an active but simple lifestyle, with easy access to daily services and enjoyment of pristine natural surroundings, there are affordable options in the Uvita area. Perhaps most interesting of all about purchasing in Uvita, one does not necessarily need to pay the price for an Ocean view when you have a wildlife corridor in your backyard and a marine park only minutes from your home.

All in all Uvita offers a package that provides everything one may need for a comfortable lifestyle, wrapped up in the beauty of the rainforest and a protected coastline. So if you are looking to “get away” and “slow down”, but don’t want to be too far away from civilization, check out the coastal town of Uvita!