Source (www.journalcr.com) By Dave Casey
The stretch of Pacific Coast between Flamingo and Tamarindo has been developing steadily for more than a decade, and it remains one of the hottest real estate markets in Costa Rica despite soaring prices and concerns about inadequate infrastructure.
Denise Shantz, sales manager for Century 21 Coastal Estates in Tamarindo, tells a personal anecdote when asked about the rise in property values there.
One of the agents found a real estate brochure from 1998 while rummaging through a desk drawer in the office recently.
“It was hysterical,” Shantz said. “Condos at Pueblo del Mar were listing for $66,000 and being sold at $55,000 or $58,000. Now those condos are selling from $175,000 to $178,000.”
Shantz, a Canadian who has lived in the Tamarindo area almost six years, was looking for a home for herself three years ago. At the Villas Mariposa, which she described as “very nice, very private,” units were selling for about $90,000.
“Now we have one of them listed for $259,000,” Shantz said.
But Shantz believes prices in Tamarindo have peaked out for the time being because of the hundreds of new condominiums and houses coming on the market.
“I think we’re going to see a bit of a shift,” she said when asked if sellers were being unrealistic in their asking prices. “I hate to use the word correction.
“We say to our clients, ‘Do you want to list it or do you want to sell it?’ People have to be realistic and realize that they can’t just keep asking higher and higher prices, especially for luxury homes. They end up having them on the market for a year or more,” Shantz said.
Some would-be sellers “don’t just put their price up by $100,000, they will put it on the market for a half million dollars or more at one jump,” she said.
Currently, Shantz said, condominiums are the big market.
“Some developers are being more realistic and some are not. There are so many (units) coming online now, the competiton is fierce. It’s a buyer’s market now,” she said.
“What’s been interesting this past year with the condos is that we’re seeing a lot come on the market in the same range -- from $300,000 to a half million. The lower end stuff has sold much more quickly. Anything we’ve got for less than $200,000 gets snapped up very quickly. But most developers don’t want to build low-end.”
So what advice would Shantz offer to a new developer?
“Right now in this area, get a little more realistic. Look out for the middle class guy. Not all of us have a half million dollars to spend on a condominium.”
Another change in recent years is that the market is moving inland, Shantz said. “Tamarindo already is pushing out toward Villareal. You see more developments in Santa Rosa and Hernandez -- smaller gated communities,” she said.
“You get some people who are retiring down here and who are middle class. They can’t afford to be in Tamarindo, or they don’t want the hustle and bustle of downtown Tamarindo. They want to be close enough to utilize the amenities but live in a more tranquil setting.”
Despite the changes in availability and pricing, Shantz foresees continued success for the real estate market in the Tamarindo area.
“I think any coastal area -- it doesn’t matter whether in the U.S. or Canada or in Costa Rica -- it’s always going to be prime real estate because people simply want to be by the ocean,” she said.
While Shantz is cautiously optimistic about the Tamarindo area, some real estate professionals in Flamingo believe that property values in that community have not even approached their potential worth.
Bob Davey, broker-owner of Century 21 Marina Trading Post, scoffs at the idea that property there has peaked.
“Ridiculous,” he said. “It’s the beginning of time for us. We’re just at the start.”
Although the company handles properties throughout Guanacaste, its office is in Flamingo and that community is where it does a significant portion of its business.
“You can’t get a piece of property here for less than $1 million,” Davey said. “We have a great project in Playa Grande, with lots in the low hundreds. People are buying them sight unseen from the United States. It’s very early on for this market.”
One reason Davey cites for his enthusiasm is the current administration of Costa Rica President Oscar Arias and what it is doing to sustain good development by improving infrastructure and security.
“This administration has put it in place a good plan,” Davey said. “The last administration didn’t do anything. They might have even gone backwards.
Davey said some visitors and potential investors “left here and gave Costa Rica a bad rap” because of its poor roads and other problems.
“It’s indescribable how poor the roads were. People were leaving here with back and neck injuries. And the (Liberia) airport experience was bad. There were the bad headlines we had for the past year -- the security situation got out of control. Not just for tourists; the foreigner residents and the locals were prey, too.”
But the creation of a new tourist police force and the decision by several coastal communities to hire private security is turning that situation around, Davey said.
Developers have helped fix some infrastructure needs, and the new administration is committed to improving roads, bridges and the airports.
“I’ve been here for 17 years,” Davey said. “I’ve watched every quirk and quiver of this market. It’s never been stronger.”
