We are in high season here in the southern pacific zone. The months of November through April are typically when there are more tourists here than during the rainy months.

There is another type of “high season” happening right now as well. This has more to do with world conditions. I know, those from the States are going to think that Mr. Trump is pushing many to look elsewhere. And I suspect that this is true to some extent. I think that Mr. Trump has been good for my Costa Rica real estate business. I think Mrs. Clinton would have been as well. Such is the world that we live in.

However, our property buyers here are not just from the States. We’ve got buyers from Canada, despite their currently weak currency. These people are buying property and essentially paying 30% – 40% more due to the exchange rate on their currency. One has got to wonder – why?

France, Germany, Great Britain – all are providing us here with buyers. Again: why? There are economic, political and security issues happening in various areas of the world. I suppose that greater analytical minds would come up with the cause and effect links in trying to answer the question. But I find that there is one common thread when I talk with these people.

The Reason:
Stress
is pushing, and the promise of less stress, is pulling people to consider a life in Costa Rica. Simpler living is highly attractive. Costa Rica offers this and it (simple living) seems to be the antidote to whatever may be happening in one’s home country.

Uvita, Dominical, Ojochal and the surrounding areas that make up Costa Rica’s southern pacific zone are all seeing an influx of buyers. But there is more. There are some big-money players who are making some moves here that are notable. There are condominium complexes being constructed, and sold at a good clip. There are town homes, urbanization projects and upgrades to some of the antiquated infrastructure in some of these areas.

There is some talk of giving Uvita a facelift. This is much needed. With both Dominical and Ojochal, you turn off the coastal highway and drive into the town. In Uvita, the highway passes right through the town. Up till now its growth has happened with hardly any attention to the aesthetic and it is essentially a strip-mall, Costa Rican style.

This is a pity since Uvita could really have been (or be made to be) one of the most beautiful towns on the planet. So if these well funded entities see the beautifying of the town as in their best interests, great! Although it’s hard to imagine what can be done, short of tearing the whole thing down and starting over again.

The Envision Festival is going on currently. This has become one of the largest events of the year. Kudos to the organizers. I’ve heard that 7,000 people attended last year, but that about half that number are here now.

Uvita Costa Rica's Crunchy Envision Festival

2017 Envision Festival Uvita Costa Rica

Some of the Ticos complain a bit about Envision, claiming that the drugs, nudity and general licentiousness is disrespectful to their culture. I suspect that there is some truth to these allegations, but for me, I’ve never met an Envisioner I didn’t like and the festival provides a time of some fascinating people watching.

I’ve not  personally ever attended. I can hear the music from my home well, the bass notes anyway, and I routinely provide rides to those thumbing to the grocery store and back. There is also the complaint of them being a bit odoriferous, but I can’t speak to this having lost my olfactory sense some years back. So I get along fine with them in my car and always enjoy their upbeat spirit.

So between the time of year and world conditions, sales are good here in the Zone’s real estate market.

About Property Prices:
During the recession, there was not much of a market here. It hit hard and us realtors languished waiting for the anomalous inquiry that might result in a sale. I actually got into brokering hard money loans during this time in an effort to not only make a little commission, but to also help some land owners to not lose their properties.

Prices plummeted during the recession. This was an interesting time. The pre-recession time was a “boom”. The biggest challenge for a buyer then was being able to find an available real estate agent. I felt like I should put a Baskin Robbins “take a number” device at the door. Some of these buyers were our good-old bread and butter retirees, looking to retire to Costa Rica. However, there were lots of folks who refinanced their homes and then found themselves cash-rich and wondering what to do with it. The causes of the recession helped to fuel some of that heady boom and resulted in pushing prices up to a rather silly level.

So the fall of pricing some 40% – 50% during the recession could appropriately be called a correction.

Much of our land here is still at recession pricing. There hasn’t been a big upward push on prices since then. The demand for houses is strong and so we’re starting to see some upward movement there – all very rational though. This is no heady boom. Its simply that the inventory which was glutted post-recession, is finally starting to get mopped up. This was inconceivable in the years following the recession due to the glut.

I still get asked sometimes why it seems that everything is for sale. I find this interesting since I have to really work to find properties for some of the criteria lists I build for my clients.

Yes, I suppose everything is, in fact, for sale, at some price. However, finding what you want, finding that screaming ocean view with good access and amenities nearby, and all this in your budget, can sometimes be a bit daunting.

And then there is that wonderful amenity “simplicity”. I wonder if this could be put at the top of the list. Right up there with “ocean view”. I’m thinking that this one amenity is the primary mover of the current strong market we’re seeing here in The Zone.


The Hidden Market


I’ve just submitted an article to Tico Times about the time we are in right now that is favorable for spec home building. Now let’s add to this another factor that is not as obvious. Well… it is actually every bit as obvious. It’s just that it is hidden, which is a gracious way of saying: neglected. And by virtue of it being neglected, it is a bit unknown.

Little House view

View from the “Little House”

The Zone is in an expansion period. There is a strong market here for existing houses. Many of these homes are in the $400,000 – $1,000,000 market and beyond. The realtors here are doing well selling these properties. When I get an ocean view house listing in the $350,000 range, I view it as solid gold, because this price point is in high demand, and relative to our market here, is in the low side of the range. It will likely sell quickly.

There is little to no financing on the purchase of a house in Costa Rica. This means that the buyer of a house needs to be liquid starting at right around $350,000. What about those that aren’t packing this amount of liquid cash?

The Hidden Market:

One of my sellers of a $60,000 property has consulted with me about how he can sell his property. This man knows his way around The Zone’s real estate market. He has been involved in millions of dollars worth of property business during his time here. Why did he feel the need to consult with me? Because I took his listing. He can’t get any of the local real estate guys out to his property to list it. They are not interested. Despite being low priced, his property represents a considerable amount of listing work. The real estate guy’s perspective is that he can spend his time taking a listing for, say, a $750,000 house, or for this man’s property that pays less than a tenth of the house. Duh!

I recently took a listing on a small, 1 bedroom, 1 bath house nearby to where I live in Playa Hermosa, which is a small pueblo just north of Uvita. It had been refurbished by an investor. He had found an older Tico (Costa Rican) house that he fortified, re-tiled throughout, put in a small pool and generally fixed it up. The resulting house offered what many are looking for but are having a very difficult time finding: “Ocean view home, with pool for $129,000, 7 minutes from the grocery store”. Yowza! This took me less than 3 months to sell, and I continue to receive inquiries on the property. I wish that I had another dozen of these. Alas, I don’t. But, the same (or similar) effect of this property can be achieved in other ways.

Cracking the Hidden Market Nut: Buy one of the available lots on the market, build a modest but nice home on it, and you are in it for less than $300,000. You can then live in this house, or you can put it on the market in the under $300,000 range.

In my Tico Times article, I spell out a scenario where the house is priced at $429,000. Getting a house on the market for under $300k and that is nice, will result in a line at the door.

Properties similar to the Little House I had at $129k are nearly non-existent. These are so extremely rare that, even with the buy-and-build approach, are difficult to duplicate – difficult but not impossible. And this is the Hidden Market here.

If you’re reading this and wondering how you can bring a limited budget to the table and still own a home here in The Zone, you are looking into the Hidden Market. It may be that you’ve done some searching, and perhaps you’ve even found some properties that look like they’ll work for your budget. But then when you inquire, or look a little deeper into it, you find out why the property is priced as it is. It may be way out in the sticks, or the property itself may have some problems that explain why it is priced so low.

The caveat to solving the Hidden Market problem is that currently, all of the solutions I know of require buying raw land and then building. This is beyond what many are looking for or are willing to do. However, if you’ve got a limited budget, and you really want to own a home here in The Zone, consider buying and building. Your possibilities are: 1) wait for another Little House option to come on the market, or 2) buy one of the low priced, but good, raw land options and then build on it. If you are one of those that say “I can’t build in a foreign land”, then you are going to need to go with option #1. It may be a long wait.

The purpose of this article is not to go into the ins and outs of building here. That is for another article (or post your question below). Suffice it to say that there are some good options for doing so, and that some have even had good experiences building in absentia. I’m hoping that this information will help what I feel to be a rather large segment of the buying population who are frustrated by their inability to find a property in their budget.

Let’s get started. Here are a few properties right now that I feel solve the Hidden Market problem:

Lot for sale in Uvita Costa Rica Town Uvita Ready to build, all services in, about 5 minutes to the grocery store and 10 to the beach. No ocean view, but in a very nice area.

Click to view

Price $60,000
Type Land
Size 1/2 Acre
Lot for sale in Uvita good for spec home.
Some of the usable area on the $69,000, 1 acre lot.
Town Uvita One acre of nearly all usable land. Located about 4 minutes to the grocery store. Beautiful location. The services are in. Needs simple tractor work to get it ready to build, all services in. Some ocean view. This is just next to the $60k option above. A father-son selling team.

Click to view

Price $69,000
Type Land
Size 1 Acre

Ballena building site.

View of Roca Ballena from the $83,000 spec home lot.

Town Ballena South of Uvita:

Centrally located between Uvita & Ojochal. Looking straight out to the Roca Ballena configuration. This lot is ready to build. The water will need to be run from a neighbor’s well system. The electric is at the road the runs by the property. Ocean view including the Roca Ballena formation.

Click to view

Price $83,000
Type Land
Size 1 Acre+
A sort of companion article with links just posted: “Disappearing Breed: Under $100k Ocean View Lots”

If you haven’t read the Tico Times article that I reference at the start of this article, do so. You can scale down the costs outlined there for construction to calculate if you can buy one of these properties and then build on it. Ah what the heck, I’ll do some of it here. (I’ve hit my 1,000 word limit. As a blogger I’m told that you, dear reader, have a declining attention span for reading such length. Let’s prove ‘em wrong.)

Let’s find you a builder who can build your house for $85.00 per foot. Let’s say that you want to build a 1,200 sq. ft. home. Your building costs will be $102,000. If you want a pool, add $15,000. And then let’s add another $10,000 for permits, landscaping and incidentals. So your costs are right around $130,000. Add the price of your property and you’ve got your Hidden Market home.

Fiddle with these numbers. Keep in mind that we are in Costa Rica for a reason. And this reason isn’t to be sitting inside watching the tele. Build your house cheap. This isn’t to say “low quality”. Just enclose & secure the bedrooms, bathrooms and (if you like) a media room. Go ahead and have plenty of areas under roof, but who needs walls? Your kitchen can even be open-air here. What we need is a place to sit, do yoga, talk with friends etc… that is protected from the sun and the rain.  That $85.00 per foot figure can be pushed down.

Or try this: buy that $60,000 property, build a decent abode on it for $70,000, and you’ve duplicated the Little House scenario, just without the ocean view.