Costa Rica is rapidly becoming a safe haven for the most incredible luxury homes and villas. This has largely been a result of the country’s booming tourism sector, which has massively increased in the last couple of years. So many tourists come to Costa Rica – probably for vacation, or for business purposes – but end up loving the place, and simply just want to buy property in the country. And these property investors are always looking for the most luxurious properties in the most serene neighbourhoods. This has, in turn, driven the demand for luxury real estate in Costa Rica to the roof. Now, let’s take a look at some of the common reasons why we still believe that Costa Rica is the emerging hot market for luxury properties in the Caribbean:
Foreign investors are buoying the property market
Let’s begin by saying that Costa Rica is one of the most visited countries in Central America, capturing close to a half of the market share. Most of the foreign visitors are from the United States. In terms of numbers, we are talking about over a million visits in the country every year, with over 100,000 Americans already living there. Also, there have been an increase in visitors from Canada and a few European countries. This increase of visitors, especially from the US is really driving buyer interest, especially in the higher-priced and incredibly luxurious real estate markets, in particular, on the ocean view, near the beach or beachfront properties. Most of these investors are from hot property markets such as Florida and California, who view the Costa Rican luxury property market as a great alternative for luxury real estate.
Location-wise, some of these luxury properties are found in the Central Valley, and the greater metropolitan regions such as Heredia, San Jose, Alajeula, as well as Escazu, not to mention the pacific coast. These are the areas where you will find gated communities and condominiums in large numbers, which are quite popular among foreign investors.
The development of a New Marina and port
There is a great sense of anticipation when it comes to the development of the new marina which is being constructed on Flamingo Beach in Guanacaste. Other than having better port services in the area, this development is expected to bring along a couple of other amazing benefits, including the development of amazing properties, hotels, restaurants, and even shopping centres in the area. And as the port development advances, property prices are expected to skyrocket, and more and more luxurious properties will keep being developed. In Costa Rica, there has been similar marina development, including the Marina Pez vela in Quepos, the Peninsula Papagayo marina, and the Golfito super yacht marina. In some of these areas, there has also seen an increase in luxury real estate, such as the Four Seasons, which is one of the best five-star resorts in Central America.
Judging from a couple of massive investments in the country by multinational companies such as Coca-Cola, we can confidently say that the country is on course towards financial growth. Now, with this company in the country, it propels its exports even further, as it’s already a leading food exporter. By boosting the country’s exports, it will, in turn, lead to economic expansion. As we know, the more the economy improves, the better the real estate market gets, especially luxury homes and villas since people will be able to afford them, as their incomes will increase.
Property taxes in Costa Rica
The property tax rate in the Caribbean country is a mere 0.25% of the value of the property, which means you might only be required to pay $500 for a property worth $200,000, every year. For luxury properties, the tax rate will be 0.55%, which is way less compared to a majority of the countries in the Latin Americas. This fact alone has also propelled the luxury real estate in Costa Rica to new levels, making it the ‘mecca’ of incredible luxury properties in actuality.
Better amenities and security
As we mentioned earlier in the article, Costa Rica really enjoys a high tourism rate, especially from the US, which means that the sector plays a critical role in its economy. Now, for a country to have such a level of tourism, of course, you expect it to have extra amazing amenities and security. This is exactly what the country offers, and this is why the luxury real estate is on the rise, because people would spend a fortune just to own a luxurious property near some of these amenities.
Return on investment
One thing about luxury real estate, anywhere in the world, let alone Costa Rica is that it offers an amazing return on investment. This has always been the reason why people would prefer some of these properties over basic ones that don’t offer much of anything. And given the influx of foreign investors in Costa Rica, who are willing to spend on luxury, one will always have an incredible chance for resale, if you need to.
The purchase process
The process of buying a property in Costa is quite simple, but is in large part similar to that in the U.S or Canada:
Checking the properties out – the very first thing you will do is to find the property of your choice, with the help of a local agent, of course. The agent is very important since he or she will help you in selecting the best and most incredible property, and also to remember well that most properties aren’t on the internet, meaning a bit of footwork might be necessary.
Buying – Once you get the property you want, have your agent write an offer. The process might take a little bit more time, but it is very thorough and also gives you more time to negotiate the price. After that, then have your attorney create a formal purchase agreement. You will be needed to pay a 10% deposit to a government-registered escrow account, which must be done within two weeks.
Closing – the closing process will then start, and it takes about 30 to 60 days.
As you can see, the process is pretty straightforward and easy. You just need to have a reputable local estate agent and attorney.
In conclusion, we have every reason to believe – and as we have seen in this article, the luxury real estate market in Costa Rica is rapidly growing, and in the near future, it might be unrivalled, particularly in the region. So, if you are looking to invest in a luxury villa in the country, you should start your own due diligence and get yourself a reputable estate agent to guide you through the entire process earlier, when the prices are still moderate.