Once you’ve made it down to Costa Rica, it’s time to explore. Your first order of business should be to pick up a few of the local real estate magazines that litter expatriate hangouts. This include 4 Sale by Owner, as well as another called Inmobilia. The Tico Times publishes on Fridays and is also worth a read. Next, if you find yourself in your final destination where you would like to shop for properties, start visiting brokers. Hook up with the ones you’ve previously contacted to do an interview and check some references before you get down to business. Pop in to a few more offices that you either spot around town or that you’ve previously researched. In all cases, ask what they have to offer and check references. Avoid pushy brokers – Costa Rica has become a buyer’s market and there is almost nothing a broker could sell you that would be “too good to pass up.” Neither should you have to pay an hourly, up-front fee to the broker. If you’re interested in condos or new homes, rent a car and follow some billboards to development sites. Check out the model homes in gated communities and check out the renders in the sales offices of condo towers under construction. Buying from a developer will streamline the buying process as you won’t have to deal with a broker, but be careful not to get talked into any risky pre-construction sales. Another thing you can look for as you drive around are signs that say Se Vende, or for sale. Other than going through a broker, this is the only way to find rural farm properties for sale, so get out there.

Once you’re satisfied that you’ve found a good broker, then the real fun begins, as he or she shows you around to different properties that meet your criteria. Remember to use only one broker per region. Mostly, brokers have the same product inventory, so you’ll be wasting their time if you enlist more than one to show you properties.

Short of enlisting the services of a broker, there’s one other thing you can do that will allow you to search for properties “off the grid:” Hire a Tico to act as fixer, interpreter, and intermediary in your search. Doing this can be risky, for any number of reasons. Language and cultural barriers will prevent you from really know what’s going on and you’ll therefore be more exposed to fraud risks. But there are still plenty of honest Ticos out there just looking to make a living, and especially in more rural, undeveloped areas, hiring a local can be the best way to find a deal.

Valuing a property

Pricing in meters

How value is assigned to a property depends, of course, on the property. Generally, however, turnkey properties like condominiums are priced according to their constructed square meters (i.e. - any space that’s under a roof) plus any additional property (outdoor parking, garden, etc). A square meter equals 10.76 square feet. The price you pay per square meter of the building will vary according to concrete factors like the quality of the furnishings and the building materials, as well as intangibles like location and market conditions. Generally speaking, anything costing over $1,000 per square meter – especially large houses – should have top-of-the-line furnishings and be in excellent conditions. That per-meter price tends to be higher the smaller the house or apartment, and will vary wildly according to location. A small condo in a prime Guanacaste beach location can cost upwards of $2,000/m2, while large country homes around Cartago or on the Caribbean slope can be down in the hundreds of dollars per square meter – once again, depending a lot on the furnishings.

Pricing large tracts of raw property is traditionally done differently. Pasture and farmland is sold by the hectare, a unit equivalent to 10,000 square meters, or 2.47 acres (occasionally in rural areas you may also run into manzanas, a unit of area measurement equivalent to 1.72 acres). In rural areas, these prices can often break down to a few dollars per square meter, which is certainly a deal. You can tell an area is becoming more valuable (or anyway, more residential) once the tracts of land get smaller and the prices are posted by the square meter, as is the case now in beach towns and has always been the case in urban areas. In really hot markets the price for raw land can go up above $1,000 per square meter, though this isn’t common, and expensive land should certainly come with added value, like sewer and electric hook-ups and road infrastructure.

Price comparisons

As mentioned elsewhere in this book, finding a nice property is one thing, and finding a property at a realistic price is an entirely different matter. Property is regularly overpriced to see if the gringo will bite, although that overpricing isn’t entirely the fault of the owners: Lots of property bought in rural areas is farmland, with no residential pricing precedents in living memory. A few other market factors make it difficult to put a clear price on many properties and homes. The biggest issue is, of course the market’s lack of a multiple listing service, especially one that keeps a record of past sales. This makes it difficult to find out how much other properties are selling for (“comparables,” in real estate jargon). One solution is to hook up with a well-established broker with lots of listings and years of experience. Name-brand brokers like Century 21 and ReMAX have offices all over the country whose databases are connected, but beware: Some of those brands are just carpetbagging operations. In many areas of the country, the best brokers don’t have a branded franchise. An experienced broker with many years in the market will be able to give you price comparisons, as well as an idea of the market’s past performance. If you’re looking for a somewhat liquid product (residential condominium) in an active market (Jacó or Tamarindo) there should be plenty of product on the move that will allow you to take an educated guess as to the value. Be careful, however, to get some sort of documentation or proof of sales values, as rumors run fast and wide.

Perito

Another option – actually, a recommendation – is to get a quote from a professional property appraiser, the famous so-called perito, or expert. A perito will visit a property, measure it, note the materials used, examine the construction, and take the local market into account to place a value on the property. Keep in mind that the final quote is just an estimate, and should be taken only as a starting point for negotiations. But the perito is there to serve you, not the seller or the broker, so the evaluation plus a short sit-down interview should give you a clear picture of what’s going on. Peritos usually have a university degree in architecture or some sort of engineering. There are a handful of reputable companies that offer this service, for whom contact information is available in the resources section of this book. You can also use local companies or individuals that are based in the area where you’re looking to buy.

Pre-Construction

If you’re looking for a property in a condominium development or a gated community, you’ll probably encounter a lot of “pre-sale” offers. The pre-sale tag is supposed to indicate exclusivity (you’re getting a crack at the property before it goes on sale), but it has become such a common marketing ploy that it can more accurately be described as pre-construction sales. As a general rule, anything you agree to purchase before it is finished will be cheaper than the final price, and the price scales according to the progress of construction. A condo in a development that hasn’t even begun construction is going to be cheaper than a condo in a development that’s just getting the final touches. Keep this general rule in mind as you shop around. You take a substantial risk by agreeing to buy something that doesn’t yet exist, and you should therefore be expecting a greater return on your investment (thanks to the lower price of entry). At the same time, you can’t expect the price of your finished condo or house to skyrocket once it’s finished. Although this happened in the last few years in areas like Jacó and Tamarindo, that cycle is peaking. While you can expect your property to be a good investment, it probably won’t be a winning lottery ticket, so if you’re taking the risk of buying pre-construction, be sure to get a good deal. Finally, you might be able to negotiate the price of a pre-construction condo, but mostly only in the early stages of the construction.