Costa Rica is a major tourist attraction for people from around the world but, primarily, the U.S. and Canada. Indeed, tourism accounts for nearly eight percent of its gross domestic product. This tiny country, only about the size of West Virginia, is world-famous for its warm, sun drenched beaches and beautiful tropical mountains and landscape. Though it encompasses only one tenth of one percent of the planet, it is home to an incredible diversity of plants and animals. In fact, nearly one of every five species of plants and animals on the globe is found here. There are more kinds of butterflies in this little place than on the entire African continent and nearly the same number of species of birds as in the continental United States. It is no wonder, then, that Costa Rica draws tourists like a magnet. This country, which has been a democracy since it cast off its Spanish conquerors, has acquired the status of a tourist hot spot in Central America. The boom in the tourism industry has contributed positively to the growth of Costa Rica real estate over the past decade.
Most real estate investors and second home buyers are concentrating their attention in areas that are attractions for tourists and, in particular, its magnificent Pacific coast. The large scale purchase of prime property along beach fronts (all of its beaches are public), mountain properties, farms (called fincas) and vacation rentals by expatriates have contributed to a steep hike in real estate prices in the most coveted areas.
The demand for real estate is concentrated mostly in areas where the tourist influx is large. This has been largely the north and central Pacific coast. The purchase of vacation property and real estate for relocation by expatriates are two main reasons why the property prices have gone up. In addition to the coasts, money is flowing into investments on farms (called fincas), mountain properties, and vacation rentals. Increasingly, Costa Rica is also being seen as a retirement destination by many retirees hailing from cold countries in Europe as well as America and Canada. The highly stable democratic political system and the beauty of this country attract real estate purchasers from around the world who want to have a piece of paradise to themselves. Costa Rica is one of only two countries in the world without an army, the other being Switzerland, and is extremely forward looking. The government is committed to sustainability and in a few years, Costa Rica will be the first country on the planet to have a zero carbon footprint. No wonder so many people fall in love with this place.
Costa Rica real estate has been, and continues to be, a good investment because the country has a very stable political system and a growing economy. Unlike Mexico, foreigners can own free title to land. The crime rate in Costa Rica remains low, though increasing, and human development indices are very high compared to other Central American countries. The tourist influx has also seen the country evolve to accommodate the international community. More and more international investors have come to the conclusion that Costa Rica is a great place to invest in real estate and their returns on investment have borne out that faith.
How has the economic downturn in the States and Europe impacted Costa Rica? Not surprisingly, subdivision and condominium development have dramatically slowed or even been put on hold, and in some parts along the Pacific coast American second-home buyers, now cash-strapped, are listing beautiful properties at huge discounts. These are properties that were by American and European land prices good buys when made. Now they have become extraordinary opportunities.
However, many experts predict that the boom will resume in the coming years. Costa Rica will continue to draw tourists and retirees from America, Canada, and Europe. Savvy investors often pool their money to form real estate ventures with, up to now, assured returns. Indeed, many folks who invested in Costa Rica real estate a decade ago have seen their investment soar. To be sure, the economic woes in the States and Europe are felt here now but the price stagnation or decline is temporary and will form the basis of a great recovery.
The steepest rise in property prices and the steepest decline (due to the U.S. and European recession) have been along the Pacific coast. The beautiful Caribbean coast remains largely undeveloped so the run-up in prices was slower. And real estate prices in the Central Valley containing the largest city, San Jose, and some 40% of the country's population have not been significantly affected because of the acute shortage of available land and continuing demand as more and more Ticos move to the urban areas.
About the Author:
Victor C. Krumm writes from tropical Costa Rica and has an informative websiteCosta Rica Vacations. Look at prettyCosta Rica Real Estate
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