Costa Ballena Real Estate Market Report For February, 2020: Growth In Tourism Contributing To Increased Sales

May 12, 2023 in Tips for Sellers, Tips for Buyers, Real Estate in Costa Rica, Discover Costa Ballena

If you’ve been receiving our newsletter about Costa Ballena real estate for longer than a year - firstly, thank you very much for subscribing and reading! We value our newsletter database immensely and we get a lot of great feedback so we hope you’ve enjoyed yourself and learned a few things about our real estate market along the way. Secondly, if you’ve been reading for a while, you may have noticed a significant uptick in the number of new listings coming out in the first month of 2020. That’s because we saw an increase of over 43% in new listings in the Costa Ballena over January 2019! This is huge news and a sign of seller confidence in listing properties in our South Pacific region of Costa Rica. Read on to learn about what might be inspiring growth.

Economic Confidence in Costa Ballena

For a period of about 6 months after last year's high season (December to May), new listings seemed to take a dip. Inventory was low after a big selling season and developers took the opportunity to build spec homes and condos in 2019. It appears to our Osa Tropical Properties office that developers and other property sellers in 2020 are taking the example of last year and listing their properties in Costa Ballena at the start of this high season. This will ensure that their property is positioned at the top of most local real estate websites and seen by the largest amount of new buyers.

Increased Tourism in Costa Rica in 2020

The growth in tourism in Costa Rica may also be a significant factor in inspiring seller confidence in our South Pacific Costa Rica real estate market. Throughout Costa Rica, 3.1 million tourists visited the country in 2019, signifying a 4.1% growth in tourism over the previous year. More than half of those tourists came from North America and the majority from the United States, which on its own experienced a 5.5% increase in visits here. And tourism from Canada represented more than 8% growth over 2018.  Half a million tourists in Costa Rica originated in Europe in 2019. The European countries that represent the highest contributions to Costa Rica’s tourism industry are Germany, the United Kingdom, France, Spain, and The Netherlands. Each of these countries has regular direct flights to Costa Rica and more are planned in the near future. Also in 2019, 2% of travelers to Costa Rica were from Asia and the Pacific.

Importance of Tourism Industry to Costa Rica

Tourism is one of Costa Rica’s economic pillars according to the government. Tourism accounts for 20% of Costa Rica’s total exports, which is why the government spent a record amount on international promotion throughout North America and Europe. Most tourists to Costa Rica arrived by air in 2019 and nearly two-thirds of those transited through Juan Santamaria Airport. The Costa Rican government plans to invest $160 million through 2020 to improve the nation’s largest airport’s infrastructure to support and increase this growth. Daniel Oduber Quiros International Airport in Liberia experienced an increase of 8.5% visitors transiting through in 2019, with the expectation of further growth in 2020 after several new flights are inaugurated in the coming months. Costa Rica’s growth in tourism exceeded the global average of 4% according to the World Tourism Organization. This growth comes in spite of unfavorable international economic scenarios like Brexit and strained US trade relations. President Carlos Alvarado stated last week that “Costa Rica is a world leader in the field of tourism, which is a fundamental pillar for equitable development, economic activation, and job creation.” Roughly 5% of Costa Rica’s population is employed in the country’s tourism sector in 2018. Foreign visitors in 2019 stayed for an average of 12.6 days and spent roughly $1,400 USD each. They came mainly to visit beaches, volcanoes, and national parks.

Rental Homes in Costa Rica

Rental homes are the most popular way that tourists are enjoying our South Pacific region of Costa Rica, according to Christine Schiferl of Jaguar Property Management in Uvita. She says that she has seen her business shift in the last year, moving steadily towards the luxury rentals market. In the last year, Costa Rica introduced new tax reforms, a new IVA tax, and digital receipts, meaning that business owners following the law have needed to increase prices. This has reflected in the type of tourists visiting Costa Rica. What used to be hippies and surf bums visiting the South Pacific have become luxury ecotourists. Schiferl has noted a particular increase in Europeans visiting, especially from Switzerland and Germany, with aesthetic sensibilities that primarily lean towards contemporary, with clean lines and premium details. "If you want to have a successful rental in Costa Ballena," says Schiferl, "you have to stand out in the crowd and have all of the right boxes checked. Think oceanview, close to town, private, and an all-around beautiful home." She believes that luxury rental homes in Costa Ballena that have all the right bells and whistles have the highest occupancy rates. "Our top three rental homes right now are seeing 90% occupancy rates and each of them has all of the things a guest could want in a luxury rental home in Costa Ballena."

Costa Ballena Real Estate Market in 2020

Our local Costa Ballena real estate market (including Dominical, Uvita, Ojochal and beyond) has been inundated with tourism at the start of 2020 with no appearance of slowing down. Local confidence in the market is being expressed by a number of new restaurants opening and by the number of potential buyers that we have contacting our office looking for income properties. Sold listings in the Costa Ballena last month increased by 12.5% over January of last year. The properties selling in our region in 2020 so far are mainly homes and lots under $250,000, showing that foreign market confidence is low for making large investments at the moment.  But following the typical pattern of new buyers in Costa Rica, the growth in tourism to our region bodes well for creating future demand for homes. Over the years, we have noted that the vast majority of buyers begin as tourists who fall in love with our region on sight and head home with the burning desire to return for longer, with a few committing right away to purchasing property sometime in the near future. If this pattern continues, we can expect an increase in property sales in our region in the coming year. 

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