This entry is part 1 of 1 in the series Understanding Costa Rica Real Estate

Costa Rica History in knife metaphorI’d say that about 1/10th of my time spent with people looking to buy property in Costa Rica’s Southern Pacific zone is spent in the actual buying/selling of property. The other 9/10ths is a mix of conversations regarding what’s involved with living here, as well as discussing the business of real estate in Costa Rica.

At its core, the lack of an actual MLS (Multiple Listing Service) colors all aspects of the business here, and I’ll go into that later on in this series. To really understand the business of real estate here, I have found it helpful to go back in time and see the progression of events up to the present. This helps to not only understand the current market but also, to project what is to come.

Early days:
I got into real estate in Dominical in 2004. It felt like the day I got into real estate was the day that someone threw the on-off switch on the market. Since then I’ve heard some tales indicating that the market was already simmering and poised to boil.

I made a sale on my first day in the business. A $60,000 gorgeous ocean view property sized at around 2 acres.  The property featured Uvita’s Whales Tail front and center. That property has gone on to have a lovely home, guest house and pool built on it. It has been re-sold and enjoys a stellar vacation rental history (link to rental page on HomeAway)

Quick overview of The Zone:
The Zone is made up of a string of 3 towns with Dominical at its northern end. The northern boundary is not a hard line but is decidedly fuzzy, easily extending up to Hatillo and at times, up to Portalon. (link to Hills of Portalon Development).

From Dominical heading south on the coastal highway you get to Uvita and then further south, to Ojochal. The area between Dominical and Uvita has a nicely laid out mountain range that runs very parallel to the ocean. Hence the handle “coastal mountain range” This means that you can travel inland from the beach just a short way and get to elevation where it is breezy and cool and offers expansive views of the ocean and coastline, attributes which make this area extremely desirable to investors, relocators and migrators (part-of-the-year residents).

More History:
Before the incoming press of foreign interest in The Zone, the Ticos (Costa Ricans) owned all the land, and their land holdings were always in the multi-hectares (1 hectare = 2.48 acres. Think 2.5 to make it easy).

There was a time in the not too distant past when land in Costa Rica was nearly value-less. There were land-grant programs whereby a man simply had to be willing to take responsibility for a property and the government would “grant” him the land, with conditions.

At that time it was not known that “nature” had a lucrative aspect to it. Instead nature was largely viewed as “in the way” and needed to be tamed, subdued or eliminated. So, one of the conditions to receiving a land grant was to cut the trees down and raise cattle.

I suspect that this era may have coincided with the “McDonalds” explosion. This is an arguable point, so let’s just say it coincided with an extreme demand in the U. S. (and world) for beef.

After some time of cutting down enormous canopy trees and attempting to raise cattle in former rain-forest environs, there was a shift in our world’s appetites; nature became an important commodity. Granted, beef has continued to be an active commodity, but it was also learned that former rain forest land doesn’t necessarily make for the best pasture land.

Raising cattle in Costa Rica was a daunting struggle. The farmers found themselves up against nature. Having to maintain former rain forest jungle land in “pasture” condition presented its trials, as well as the fact that the beef business (exporting meat, bureaucratic inefficiencies, and 3rd world infrastructure or lack thereof) made a guy scratch his head and wonder if having all this land was such a good idea.

The Tico culture was/is multi-generational. These large, granted tracts of land, would end up being populated by the man who acquired the land, his now grown sons & daughters and their families, and the grand kids (soon to also have families.)

So despite having lots of land, a condition that in first-world countries equates to being wealthy, these farmers were subsistence. They lived off of what their land produced. As a child would grow to adulthood, Abuelo (abuelo = grandfather) would simply build them a house and apportion off some land (or not) and they would continue on contributing to the sustenance of the family. The land itself was not thought of in lucrative terms.

Abuelo just happened to acquire a land grant on, let’s say, 60 hectares of land that reaches from the inland side of the maritime zone on the coast up to the highest point of the coastal mountain ridge. He’s not thinking “oh boy! I’ve got some ocean view land here.” No, he’s thinking: “man I hope this land is fertile.”

Enter foreigner:
One day Bob, a tourist, is exploring the area and decides that he’d like to buy Abuelo’s property. Bob offers Abuelo $60,000 for the land. Abuelo has never even considered the remote possibility of maybe someday having such a sum. In fact, he’s never even seen that much money. He talks it over with his family and they (very understandably) feel that this would be a wonderful thing for them to do. So, they sell their land.

Bos is a visionary. He sees what is likely coming and so he stakes his early claim. Now, keep in mind that there is no electricity to this property, the access is horseback and the water is from a nearby spring that is bubbling out of the ground. Abuelo has run a pipe from the spring to an elevated storage tank near the family homes. Bob’s a visionary in that – what foreigner in their right mind would possibly want such a remote and forbidding piece of land?

To understand this is to understand the element that is credited with making the world go round. We all have different likes and dislikes. I wonder at the likes of Steve Jobs, Bill Gates and Paul Allen’s level of focus on the personal home computing idea at the time that they had that focus. I’m not of this ilk and so my hat is off to such ones. I view the early investors here in The Zone as being made of the same stuff.

In looking back over the history of the first wave of investors here, I marvel at their foresight. My then wife and I looked at some Whales Tail view property in Uvita around 2002 and, despite its being gorgeous and nicely priced, I felt that it was simply too remote. This was in the same area where 2 years later I sold my first property.

Ok, so I said that to understand the real estate market here in Costa Rica, it helps one to know a bit of the history. Granted, we’ve gone back to what I appropriately call the first-wave of intrepid and visionary investors – The Visionaries. We’ll continue on in the next article with Bob’s next steps and incredible gains on his visionary act.

About Bugs & Chilis

My first three weeks in Costa Rica (1999) my legs were red and itchy from the knees down. After those three weeks, it’s been smooth sailing. My legs cleared up, and aside from the occasional bloom, bugs have not been a problem.

I’m not clear on what happened, but as is my custom, I’ve got a theory. However, it is just a theory because truth be told, I’m just guessing here.

Bugs swarming

Bugs are a feature of nature.

Bug bitten legs.

What legs might look like during the first 3 weeks in Costa Rica.

I’m not clear on what happened, but as is my custom, I’ve got a theory. However, it is just a theory because truth be told, I’m just guessing here.

I have always figured that the bugs stop biting due to one of two reasons.
1) They are still biting me but I have developed an immunity to them, or
2) My body adapted and emits some type of repellent substance, scent or what-have-you and they are simply not interested in me.

Frankly, in looking at my theory in writing I would say that it needs some work. #1 is highly suspect because I think that I would know if the little blighters were biting me, even if their bites didn’t result in itchiness. I’ve always leaned a bit more towards #2, and maybe this one’s it, or close. And then there is a new addition to my theory which I will expound on below.

In working with my prospective property-buyers here, most seem to have the same experience. Many are here for less than 3 weeks so they could easily conclude that Costa Rica is buggy and so pack the repellent. Others who have stayed longer than 3 weeks relate that they too have had the same experience of a 3 week term and then it tapers off.

There are some however, generally women, that never get the reprieve and that simply live here as bug banquets, regardless of how long they’ve been here. I’ve come to recognize a skin “type” that enshrouds such ones.

Part of my theory states that the use of bug repellents work against, or cancels out #2 – the body adapting and emitting pheromones or whatever. I haven’t used bug repellent here in forever. My theory states that you set the clock back every time you use the stuff. I’ve also done some study of essential oils and marvel at what these medications of nature can do, simply by being absorbed through the skin. This makes me leery of what I put on my skin, even those that tout the “organic” label.

Read the ingredients of a bug repellent and decide if this is the kind of stuff you want coursing through your system, because that is what they will do, ending up in your liver (please keep in mind my disclaimer above about my level of expertise on such matters). So, for those who get the 3 week reprieve, I suggest avoiding bug repellent.

A mosquito net can be a good idea for the bed. My immunity to their bites does not free me from being harassed during the night by buzzing in my ears. I like nets mainly for the cozy, Arabian tent kind of feel they create. Or maybe it’s a “back to the womb” effect. Whatever, if you’re concerned about bugs, get a net. They can look classy as well. I don’t personally use one but instead rely on window screening and being careful about having lights on in the house at night with a door open.

For those who have the skin type that will always be a bug magnet, well… you’re on your own. Sorry. Actually, you can dress against the bugs to some extent, and you can use the nets mentioned above – OR, you can read on…

Here’s an addendum to my theory. This was propounded to me recently by the seller of my island listing in the Golfo Dulce. If there is any place where one would think bugs would be present, it’s there. She noticed the degree to which I spiced up my food. After I turned down a couple of her offers of bug-repellent, complete with the proviso of being “organic”, she said, “you don’t need bug repellent because of your hot-spicy diet.” Well now, this is a new thought for me, and makes as much sense, or more actually, than any of the other parts of my theory.

I have an extremely high tolerance to spicy hot. I also have an addiction to said foods. Recently I was at the farmer’s market in Uvita. Maria, the gal that makes all manner of excellent food-stuffs: tahini, coconut oil, chips and so on, also makes some of the best darn chilero (hot sauce) I’ve ever had.

On a recent visit, I had a visitor with me and he sampled one of Maria’s hot sauces, which resulted shortly in whisps of smoke emanating from his ears. I thought, “hey, that looks good”. So I tried it. And sure enough, same effect. Now, keep in mind that my tolerance is high and so it takes quite a bit for a chili pepper to get smoke to come out of my ears.

“Maria!!!” said I, “What the heck is this salsa??!!” She replied that in her delivery of chili peppers, there were a couple bunches of ghost peppers.

Ghost Peppers / Naga Bhut Jolokia

Home grown ghost or Naga Bhut Jolokia peppers

Ghost peppers are high on the scoville scale of hotness. This was my first experience with them. My guest saw my enthusiasm about having found such a chili and he bought me a good sized jar as a gift.

I have since gone back to Maria and bought out whatever she had and so I now have a good supply and am planning my ghost pepper garden. I think that Maria is glad to see that batch go as they were hard to sell.

I relate all this to underscore the possible beneficial effect of spicy hot to our topic of bugs. Maybe, instead of slathering on the mix of repellent goo, start to build a tolerance to spicy hot. This can be done. I’ve seen friends of mine do it. Start light, and gradually build it up.

I did some research (read: visited a few websites) about the effect on the body of eating lots of spicy hot food. I was concerned that the level at which I ingest such foods might have a negative effect on my body. What I found was the opposite. The concerns of spicy hot foods causing ulcers and rectal cancer are myths. Turns out that hot-spicy chili peppers are one of nature’s super-foods. My friends will attest to my zealous preaching about the benefits of building a tolerance.

Capsaicin is the ingredient in all hot spicy chilis that makes them hot and spicy. One thing it purports to stave off is prostate cancer. Really! The article said that scientists witnessed prostate cancer cells “committing suicide” in the presence of capsaicin. And this amidst numerous other health benefits to eating the stuff. If you don’t want to add spicy hot to your diet, do not do the search for “health benefits capsaicin”.

And apparently, there is the locally tested, and now here documented, empirical data to support that such a diet will also keep you nearly bug-free in Costa Rica.

* The Naga Bhut Jolokia or ghost pepper rates at 855,000 to 1,041,427 Scoville Heat Units (SHU), a measurement of spiciness. That’s 107 to 417 times hotter than a jalapeño (8,000 on the SHU) and 10 times hotter than a habañero (100,000+ SHU).

“10 Reasons Eating Hot Spicy is Healthy”