Above: On the market for $1,249,000, this ocean-view home features a stunning modern design.
This month, four Leading Real Estate Companies of the World® (LeadingRE) members discuss the trends shaping the Central American market.
Blue Zone Realty International
Serving the Costa Ballena region, the South Pacific including Manuel Antonio, Dominical, Uvita, Ojochal and the Osa Peninsula
Tim Fenton
President
https://www.bluezonerealty.com
Tell us about your company.
Blue Zone Realty International was founded 10 years ago on the principle of service. Our team of agents is very diverse, yet they come together to form a united group of individuals who go out of their way to support and encourage one another. Our firm has won numerous awards, including “Best Real Estate Agency, Costa Rica” from International Property Awards for five consecutive years.
What are some of the most important trends in your market?
Market trends in 2023 are compounded on the success of 2021 and 2022. With more people looking for property outside of the U.S., our sales in 2021 were 4.5 times higher than any previous year. 2022 saw an 18% increase over 2021, and Q1 2023 set a record for new contracts signed. The trend is for people to purchase a home in Costa Rica (a second or third home), with the idea of relocating in two to five years; however, 2023 has seen a record number of buyers looking to relocate immediately. Our average home price is $600,000 USD. Prices are rising, with a 20% increase year-to-date.
What types of properties do you sell, and which are most popular?
Our most popular properties are single-family homes and luxury homes. We also sell a lot of land, hotels and commercial properties. There is a focus on outdoor living spaces and amenities such as pools, large patio spaces, privacy and ocean views. Popular interior features include modern kitchens, vaulted ceilings and huge glass windows or sliding doors to highlight the beautiful outdoors. Outdoor showers are also quite popular.
What are your biggest challenges/opportunities for growth?
Currently, our biggest challenge is a declining inventory. The other challenge is that we operate in a cash market, with traditional bank mortgages only available to citizens of Costa Rica. This means that as interest rates and inflation increase in North America, some of our clients have a little less cash to spend on their home in Costa Rica. This has a lesser impact on our luxury market.
Are you seeing much foreign investment? What advice do you have for buyers outside your area?
Ninety-eight percent of our sales are to foreign investors. The United States makes up about 70% of this market, followed by Canada at 25% and Europe at 5%. In 2023, we’ve seen an increase in European buyers. The real estate industry in Costa Rica is still mostly unregulated. Therefore, it’s important to work with an accredited REALTOR® who has a proven track record of success. It’s also important to work with an attorney who specializes in real estate in the specific region that you’re investing in. Most real estate lawyers speak English.
What do you love most about living in your area?
Uvita, Costa Rica, is a popular destination for those seeking a laid-back, nature-focused lifestyle in a warm and sunny climate, with an affordable cost of living. It offers stunning natural surroundings in the Southern Pacific region with beautiful beaches, lush rainforests and stunning waterfalls.
How does being part of Leading Real Estate Companies of the World® help advance your business?
Our membership in Leading Real Estate Companies of the World® is the cornerstone for our success. Our membership means far more to us than just the valuable referrals that we receive through our partner companies on the global stage. Our membership has been instrumental in building our reputation as a qualified and professional firm with unmatched local expertise and a proven global reach.
KRAIN Luxury Real Estate
Serving the Guanacaste region of Costa Rica
Sarah Breitlander
Co-Owner/Co-Broker
https://www.krainrealestate.com
Tell us about your company.
Our professional background is what sets us apart. Our country doesn’t have any real estate licensing law, and we’re comprised of agents who have, or have had, their real estate licenses back in their home countries of the United States or Canada. Before moving to Costa Rica, I spent a decade as a successful commercial litigation attorney at one of the top law firms in Chicago, Illinois. Co-owner Peter Breitlander began his career working for an internationally recognized real estate brokerage in 2002, before rising to become one of the brokerage’s top-producing agents. In 2005, he became co-founder of KRAIN Corporation (aka, KRAIN Chicago), a highly successful boutique real estate brokerage specializing in luxury homes and commercial investments. Recognizing a need for professional services to accommodate this growth, he expanded his company’s reach to include KRAIN Costa Rica in 2013.
What are some of the most important trends in your market?
The availability of home loans for foreign homeowners who are not Costa Rican residents is the most recent trend that’s very positive for our market. Loans are now available to qualified borrowers from the U.S. and Canada who have a 680 credit score or better.
What types of properties do you sell, and which are most popular?
Single-family homes and condos located in the beach towns of Guanacaste are in big demand—especially homes with modern, sleek architecture, clean lines and large windows.
Are you seeing much foreign investment? What advice do you have for buyers outside your area?
The majority of our investors are from Canada and the U.S. Of this group, our Canadian investors are increasing in marketshare. Costa Rica is known as the Switzerland of Latin America. It’s a stable place to invest and diversify one’s portfolio.
What do you love most about living in your area?
It offers a healthy lifestyle and is home to some of the happiest people in the world. Blue zones are a real thing. Studies have shown that people here are happier and healthier in both mind and body.
How does being part of Leading Real Estate Companies of the World® help advance your business?
We’re honored to be a part of this network. We’ve received dozens of qualified referrals from our affiliate members around the world. From a client perspective, our clients know this affiliation and respect the fact that we’re a selected and qualified member.
LX Costa Rica
Serving the capital city of San José, central valley and some coastal areas, primarily in Nosara, Guanacaste
Clari Vega
Managing Partner
https://www.lxcostarica.com
Tell us about your company.
LX agents are residential specialists focused on the high end, so they understand the subtleties of the market and high-end living, and are extremely well connected. With this focus, our training and service revolve around a particular type of client and product. Our specialization now generates more than half of our business through referrals.
What are some of the most important trends in your market?
People wanting to simplify logistics are looking for closed residential communities. Even for large plots of land, they want to be within a managed area for security and simplicity. Also, we’ve seen a significant rise in inventory and buying in tower developments, with more vertical projects in the surrounding areas of San José. The high-end market has seen many more vertical projects on the outskirts of the city, and they sell well above the $1M mark.
How would you describe your current housing market?
In both the capital and central Costa Rica, there is downward pressure on sale prices below $2M in the general market, but the higher end has remained stable the past 12 months. There seems to be a slowdown along the coast, with slightly lower foreign buyer volume in the $500,000 to $1.5M range after a large post-COVID bump. Coastal prices have had a significant decline over the past six months, but they are still well above pre-COVID levels. The average price is USD $1,450,000. There’s low long-term rental inventory across the board, and low inventory for beachfront homes.
What types of properties do you sell, and which are most popular?
We sell high-end residential properties—typically best-in-class for apartments, homes and estates. The properties we sell most are single-family homes within gated residential communities in Costa Rica’s capital city area of San José (urban and suburban). Homebuyers want pool areas with significant gardens or decks, smart systems (especially eco-friendly features like solar energy management), security in the community or built-into the property and views—ocean, city or mountain. More buyers are stating this as a requirement for their property.
What are your biggest challenges/opportunities for growth?
The biggest challenge for growth is market information. There’s little transparency regarding prices and inventory due to a lack of MLS and reporting requirements. However, this is also our greatest opportunity since a niche focus means we have greater insight than most into the high-end residential market.
Are you seeing much foreign investment? What advice do you have for buyers outside your area?
The North American buyer market (U.S. and Canada) has grown significantly. While this has always been the strongest foreign market, it has grown in the past year and a half, with notable increases from California, Colorado and New York. There’s a significant Israel/Jewish investor community, as well as Asian buyers (Chinese). The high-end market has also seen many families moving to Costa Rica from other Latin American markets (Venezuela, Nicaragua, Guatemala, Argentina). We’ve also seen significant foreign investment on the commercial side in free trade zones for global services and high-end manufacturing. This spills over into the residential market, with an influx of international executives. It’s important to work with a reputable local agency that can fill the information and access gap in the Costa Rican market where there is no MLS and lack of real estate licensing.
What do you love most about living in your area?
Costa Rica offers great weather year-round. Living in the Central Valley means we have access to the mountains and volcanoes within 30 minutes, and we can either be on the Pacific side or Caribbean side within an hour and a half.
How does being part of Leading Real Estate Companies of the World® help advance your business?
Being part of LeadingRE reinforces our professional credentials in a market flooded by informal competition. It provides access to global expertise and other markets. This is especially important in our high-end residential market since our clients are well connected themselves and multi-market.
NATIVU Guanacaste
Serving Guanacaste Province, from Playa Nosara to Playa Danta
Lorena Clare
Manager
https://nativu.com
Tell us about your company.
NATIVU Guanacaste is a company that cares about its customers. We help them throughout the process of buying a property, advising them with due diligence, financials and professional resources for different needs (lawyers, topographer, property managers). Our goal is to sell an experience and build long-term relationships. We’re a great team that supports one another to make sure everyone shines. We also care a lot about local businesses and have an online section called “Gente de Guana” (People of Guana), which describes these businesses and provides exposure to our customers to help them to grow.
How would you describe your current housing market?
In the last two months, we’ve been facing price reductions, and we have a healthy inventory. Prices in Guanacaste vary based on location; the closer to the beach and entertainment, the more expensive it is. Nosara, Hacienda Pinilla, Tamarindo, Langosta, Flamingo and Las Catalinas are the most expensive due to exclusivity and access to the beach. Prices in these areas average around $1M USD. In markets like Junquillal, Marbella, Avellanas, Villa Real, Mata Palo, Brasilito and Potrero, the average price is around $500,000 USD.
What types of properties do you sell, and which are most popular?
In Guanacaste, we have different types of customers looking for different types of properties. Investors look for hotels, single-family homes and apartments for rental income. They also look for lots to build and fixer-uppers for resale in addition to commercial investments like restaurants, stores, coffee shops and other businesses. Digital nomads are customers who come for a period who usually buy a house and sell it or rent it when they leave. Those who come for retirement usually live in Guanacaste for longer periods.
What are your biggest challenges?
The exchange rate is impacting how expensive our country has become for tourists. In October 2022, the exchange rate was C630 per 1 USD, and today it is C526.5 per 1 USD.
Are you seeing much foreign investment? What advice do you have for buyers outside your area?
Before COVID, there was a significant number of Costa Ricans investing in Guanacaste. After COVID, there was a massive increase in prices, which resulted in having mostly foreigners investing in this area. Most of our investors are from the U.S., Canada and France. I advise people to look for properties with trees and keep them. One of the most attractive things about Costa Rica is our flora and fauna. Also, invest in properties that are attractive for renters or buyers in case you’re not planning to live in Costa Rica permanently. If the investment is higher than $150,000 USD, you can apply for residency.
What do you love most about living in your area?
Having so many beaches around, listening to the monkeys and birds every day, and being able to provide my family a healthier way to be entertained (going to the beach, surfing, enjoying sunsets, playing at the pool, snorkeling, exploring new beaches, etc.).
How does being part of Leading Real Estate Companies of the World® help advance your business?
Exposure. We have amazing properties to offer customers all over the world, and being able to share them through LeadingRE gives us more reach.
For more information, visit https://www.leadingre.com/.
