May 13, 2023 in Selling Process, Buying Process, Real Estate in Costa Rica

2020 has been quite the year, no less in Costa Rica real estate. Our Osa Tropical Properties year end market review has shown our team that people still decidedly want to move to Costa Rica and their intention is only impeded by logistics. As such, like many other real estate teams, we took to a more digital approach in 2020 that has proven to help many clients of Costa Rica real estate find their way here. We know that people are very enthusiastic about moving to tropical, luxury markets in coastal regions around the world for cleaner air and a more coastal-rural environment. Everyone is searching for their own little utopia in a laidback and sunny location. Below are some of the reasons why people chose Costa Rica in 2020, a general picture of what the majority bought, and what we see for real estate in Costa Rica in 2021 amid an uncertain future.

What sold in Costa Rica real estate in 2020

New construction luxury homes in key markets like Escaleras often sold prior to completion in 2020. Property investors in Costa Rica wanted larger and more luxurious homes. We saw a 50% increase in multi-million dollar homes being built in some developments in Costa Rica and larger new luxury homes sold fastest. Real estate buyers in 2020 wanted a home gym or a yoga studio and they plan to have family stay with them. These are also the places that are booked the most frequently by the more selective travelers in Costa Rica who were seeking the most exclusive relaxation experiences in 2020. Popular properties this year have also been well-built homes on acreages. New or old, these tropical refuges offer privacy and tranquility in a place away from others. Extra space was the number one thing that real estate buyers in 2020 were looking for and buyers have wanted homes that are already built and ready to go. Our Southern Zone region has extremely low crime rates and the safety, tranquility and beauty of this location attract visitors from around the world time and again. Tourists and expats love the blend of high-end amenities with a country lifestyle. The weather is lovely year round and there are a huge amount of leisure activities amidst lush, green scenery. Closing prices have grown close to asking as the market has gone down in inventory. Since the resale market in Costa Rica is historically so strong, sellers in 2020 saw their investment in Costa Rica property as an opportunity as a strongly valued asset that offers an improvement in lifestyle with the added benefit of lower property taxes. This year allowed many seller’s to reassess their stake in Costa Rica and many have held out for full asking price or decided to take their property off the market altogether. 

Who was buying real estate in Costa Rica

In 2020, densely populated cities became perceived threats to health and freedom. Many are choosing to flee their urban and even suburban homes in favor of a less hectic pace of life with more elbow room. Many transplanted urbanites have begun working from home, making their choice to move less complicated. And these urban and suburban home sellers are cashing in on their exit plan. Foreign buyers of property for sale in Costa Rica are looking for resort-like homes that are practical and sophisticated. Americans from the US were increasingly moving south in 2020 to places like Arizona, Texas, California, and Florida, where the luxury home market continued to see skyrocketing prices and sales activity throughout 2020. As a result, those who already lived there were offered a boost in sales prices, meaning that clients of ours who were selling in those key markets were able to come to Costa Rica with greater means than they could have in the past.  Retirees who were drawn to Costa Rica in 2020 came seeking to simplify their lives while maintaining independence. Costa Rica’s universal health care is an easy and inexpensive option with excellent public medical facilities and world class private hospitals that are still generally a fraction of the cost of private medical care in the United States. Those who are choosing to spend some or all of their retirement in Costa Rica want to live in an attractive setting that doesn’t feel like retirement. Ojochal, Uvita and Dominical all have a great mix of residents that include locals, young families, entrepreneurs, and retirees. Seniors who move to Costa Rica are looking to avoid a late-life crisis by staying active and healthy in a vibrant community. According to our web analytics, people are reaching our website via searches for Costa Rica versus Panama, what it’s like to own a vacation property in Costa Rica, and lifestyle topics like gardening and raising a family in Costa Rica. The practical aspects seem to be less important to online searches although these are the questions that our team of agents would most likely field. People don’t want us to tell them what they should like and want. They seek out our help with the main logistics for how to make their dreams come true. And reading our company’s testimonial page has convinced enough potential buyers that we are a great team to trust as being helpful and in the know.

How the pandemic affected the sale of properties in Costa Rica

The year 2020 started out strong in our local real estate sector with a lot of tourists visiting our region and plenty of interested buyers of Costa Ballena real estate. Around March is when the pandemic started to impede travel into and out of Costa Rica and offers to purchase that were on the table before that largely fizzled out. A lack of certainty in various economic markets and in the ability to travel took all of the growing certainty in the value of investing in Costa Rica out of the picture. But this year has also taught many people that a long time being forced indoors and away from others has given them a different perspective on their priorities. People who contacted us in 2020 knew that they wanted to be in Costa Rica. They wanted an escape plan, whether they were ready to move here full time or desired to have a place in reserve. A large reason for people wanting to secure a property in Costa Rica is because they have heard that this small country has handled the pandemic swiftly and with relative ease. There have not been huge spikes in cases like in neighboring Latin American nations. Panama, for instance has had 80,000 more cases than Costa Rica with almost twice as many deaths despite having only 4/5ths of the population of Costa Rica. Hospitals in Costa Rica have also been managing caseloads well. Costa Rica is also one of the first nations offering its adult population of citizens and residents the opportunity to receive the Covid-19 vaccine’s 2 doses before the end of 2021, although it will not be a requirement. Frontline workers, those over 58, and those with underlying conditions will be first on that list to receive the vaccine. In spite of Costa Rica’s relatively tranquil circumstances this past year and international borders opening completely in November, people around the world largely chose to hunker down and forego travel. The cooling weather and the new wave of virus cases have created stronger lockdown scenarios around the world meaning that even though people can travel fairly freely when in Costa Rica (while abiding by national sanitary requirements), they would be subject to stronger quarantine measures when returning home. This has resulted in most potential buyers hesitating to travel at the moment if they will be required to quarantine for a length of time upon returning to their home country.  However, those who are desperately seeking to live a better life on their own terms chose Costa Rica in 2020. This year heightened a strong global desire for more space. There have been mass exoduses from many urban centers all over the world and a big trend for people moving to suburbs and more rural areas. Those who can get away with taking things a few steps further via remote work or early retirement still chose to try a life in the tropics. During this pandemic, we learned in Costa Rica that if we keep things local and stay mostly within our small communities that we can retain a sense of freedom. Whether this pandemic lasts a few more months or years, those of us who have spent enough time in the South Pacific, especially this past year, feel fortunate to have been away from the majority of hysteria. Our universal health care system is not overrun with Covid cases and it seems that the fresher and healthier lifestyle that people in the tropics tend to live has helped our situations. The silver lining of coronavirus in Costa Rica real estate is that it has decreased the number of window shoppers. Both potential buyers and agents are taking extra precautions and so people touring properties are seriously interested in purchasing. Realtors and sellers know that they are potentially risking Covid-19 exposure and have been taking significant steps to stay safe, including wiping down all home surfaces. This has made realtors in Costa Rica more likely to qualify buyers before spending the extra effort to show properties, focusing instead on creating virtual property tours. These video showing of homes and lots in Costa Rica have helped potential buyers get a feel for walking through a property even though they can't physically be there.

What we predict for Costa Rica homes and lots in 2021

A Costa Rica realtor’s main role in 2021 is likely to continue to develop into helping buyers find a desired property, as well as negotiating a price. Clients are less interested in learning about a neighborhood from the agent, having already likely researched an area before contacting an agent. For this reason, we continue to find our weekly blog posts and our video tours very helpful in reaching potential buyers who want to get a feel for this region before reaching out to an agent. Alongside this more distant role, virtual tours and communication will continue to expand. Affluent consumers are making more health-driven lifestyle choices that will continue to share the luxury real estate market and fuel growth for residential properties that can improve their quality of life. Coming back to the city will be difficult after living in what was your second home. If people find that they can continue to work and socialize from home in a flexible way, it is likely that second homes will become the more permanent primary residence, at least until the pandemic subsides.  Realtors are predicting even more vacation home purchases in 2021. People are vacationing differently than they were before. There is a bigger focus on privacy, cleanliness, exclusivity and luxury. A good vacation home can provide the confidence and travelers will always return to a clean and safe place. And a good, consistent rental income can offset the expenses associated with second home ownership. This means that our second-home markets will continue to see buyers, even in the off-seasons. Work from home has allowed people new flexibility to enjoy perks of resort life on an ongoing basis, not just during vacations. Kitchens and bathrooms are helping to sell homes now more than ever and we predict that these qualities will only increase in demand. With people spending much more time at home, kitchens are becoming higher traffic areas. This has increased the demand in kitchen remodels, with many people favoring minimalist aesthetics.  For the same reason, extra bedrooms are becoming legitimate home offices and the stronger WiFi connections that you can have at home in Costa Rica will continue to draw in the younger professional crowd. Temporary sofa or kitchen table setups aren’t cutting it anymore and working from home takes on a whole, new, positive aesthetic when your workspace is in the tropics. People will also continue focusing on decluttering in 2021 due to spending more time at home and homebuyers are prioritizing more space for storage purposes. Organized spaces can help boost productivity and creativity while reducing stress and anxiety. Social distancing continues to inspire many to rediscover their love for nature. Decks and patios are being put to good use. Having a great outdoor space makes it possible to get a change of scenery without leaving the property. Garden spaces and outdoor entertainment areas will continue to rise in popularity while also making our homes feel like a safe sanctuary.  Costa Rica is poised to continue to be a place to flirt with your dreams and desires again in 2021. So much so that it was recently named the #1 retirement destination on the planet by International Living. Based on reports of our 2020 real estate clients, if you can find your way here, we can almost guarantee that you won’t want to leave. 

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