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Costa Rica is a tropical oasis in the heart of the American continent. It is a small country of only 51,060 square kilometers (19,714 square miles) known globally for its efforts to protect nature and promote peace; it is also known as one of the happiest countries in the world. Costa Rica’s geographic position gives it access to both the Pacific Ocean and the Caribbean Sea, which means it has beautiful beaches and incredible biodiversity and views.
Numerous microclimates make it the home of many different species of plants and animals; the country has made big efforts to safeguard this natural wealth. Over 25% of Costa Rica’s territory are National Parks or Biological Reserves, consisting of a lush and secluded forest perfect for wildlife. Beautiful beaches offer great conditions for those who wish to surf or just want to relax and enjoy absolute tranquility while listening to the sound of the waves crashing onto the shore and watching the ocean view or the magnificent sunsets.
Active and inactive volcanoes, waterfalls, caves and canyons, beautiful rivers, including the unique Rio Celeste, famous for its light blue color, and hot springs, all add to the area’s attractiveness. A natural rock and sand formation in the shape of a whale tail is precisely in the place where humpback whales are spotted several months of the year as they migrate.
Corcovado National Park has been voted among the best 10 in the world by National Geographic Magazine thanks to its 13 habitat types and the fauna living amongst it. The list of the natural wonders is long and includes the amazing phenomenon of bioluminescence in one of five blue zones in the world, but these are not the only things that make this country special.
The country of “Pura Vida” secures its spot every year in the annual listing of the happiest countries in the world. The World Happiness Report 2018 named it the happiest country in Latin America. Excellent weather, access to a good health system, and of course, soccer are all part of what makes this a happy country.
This area has no army. The military was abolished in 1949. It’s a democratic country with political and financial stability. The state dedicates a large percentage of its funds to education, making it free and mandatory. The country’s literacy rate is 96%, and the government continues its efforts to offer a better quality of education; after all, human talent has attracted the investment of many multinational companies.
The number of tourists that visit grows every year. Tourism is, in fact, the main engine driving the country’s economy. The United States continues to be the biggest market for the Central American nation contributing with almost 1.2 million travelers in 2017. There are many reasons to visit: adventure, wellness, romance, sports activities, eco-tourism, business, etc.
Investing in real estate and tourism in this country makes sense, especially at a time when technology and access to information have become an ally for the tourism industry. There are, of course, as with any other commercial investment, things that must be taken into consideration before jumping the gun.
As it was mentioned before, people come here for many different reasons.
Should You Invest in a Hotel in Costa Rica?
There are some things to consider when buying or renting a hotel in Costa Rica. As mentioned before, people move or visit here for many reasons. There are the “high rollers,” the wealthy tourists who choose to stay in luxury and can afford to pay for all the comforts and VIP treatments; the backpackers who are looking for a small hostel or bed and breakfast that is affordable and convenient; the eco-travelers who prefer a secluded boutique hotel on ocean view land by the Pacific coast, with a restaurant in it, surrounded by majestic nature that is comfortable but not necessarily luxurious; the business traveler who requires a centrally located five-star hotel in a strategic location that offers all the facilities, including a popular large capacity restaurant or sports bar and access to the Limon International Airport; families that travel with young children and prefer all-inclusive resorts with a large swimming pool and other modern amenities; adults looking for the peace and romance of countryside property or oceanfront property with magical sunsets; and those who want a cultural experience and share with the community.
The list goes on and on. The point is, there is a demand, and therefore, needs to be supplied.
The first thing you need to do, if you want to invest in a hotel or new construction of homes as a vacation rental, is to really get to know the different options you have and narrow down the market you want to target. To do this, you must do your research on your potential investment.
Whether you have decided on a small bed and breakfast or a boutique property with a restaurant located in the mountains of Heredia; an eco-lodge in Punta Uva, Limon; one of the dream beach homes along Playa Grande in Cabo Velas, or Playa Potrero (close to campus if you’re considering settling down); the villas in Playa Brasilito; a house with a garden in San Jose; a beautiful resort with a pool area in La Fortuna, Arenal; a beachfront hotel just a short walk from the water in the beach town of Puntarenas or the bay of Puerto Carrillo and enjoy the nearby greenbelt; retreat to Bijagua where its land area is sprawling with flora and enjoy the mountain view as you fill your days with relaxing baths in a jacuzzi; or stay in a room of a large building in the city center of Santa Cruz or Sardinal, where they have amenities, like breakfasts, a reception area and a spa, a terrace overlooking the urban landscape, and a casino; or invest in a block of apartments, and rent out each bedroom or the beds, installed with custom partitions for privacy, to students, all in the provinces of Guanacaste Costa Rica, you must learn everything you can about the area and, of course, the number of tourists visiting the area and what their preferences are such as a mountain retreat or walking distance to the beaches or shops. Try to fill in the gap.
Once you are clear on what you want and which area you want to invest in, the next important step is getting a real estate agent and a lawyer. Many foreigners make the mistake of wanting to do the deals on their own to save a few bucks, but 99% of the time, this ends up being a big error.
When you are in a country you are not familiar with, or if you don’t know the culture or even the language well enough, you can end up (and will end up) having some bad experiences. Choose a realtor who speaks your language, someone that has experience in renting and selling hotels of all sizes, whether you want a profitable boutique waterfront hotel or a fully equipped resort inclusive of a restaurant on-site or cabins in the country. They should also have lived in Costa Rica long enough to know the challenges that come with buying and renting properties for tourism.
Don’t be afraid to ask questions and expect them to adhere to your requests as much as possible, your budget, and your preferences. Do you want a small property? What would be enough free space?
It will be hard to get exactly what you are looking for, but a good real estate agent will know the market well enough to give you the alternatives that best fulfill your requirements and give you all the pros and cons of a property and location.
A good lawyer is also important. If you know someone in the country that you trust to give you a recommendation, go this route. Otherwise, choose a law firm that has a name and reputation to protect. That is the safest option.
Make sure they go over every single detail regarding the legal status of the property you are looking to buy or rent. You may consider this tedious, but it is absolutely necessary to put in the time to go over this information with your lawyer so there are no surprises in the future.
Taxes. Always consider taxes. Your lawyer and realtor can help you get some of the information on the payments you’ll need to make, at least property taxes and corporate taxes, but also get information on the income tax payments related to the type of business you will be running, like a small hotel with its own restaurant on the property. Having all this information will help you make an educated decision. Put together your business plan and ensure it is realistic and within your budget.
The Costa Rican Tourism Board can offer a lot of useful information and assistance for new hotels, from free training to certifications and options to participate in tourism fairs to help you promote your business. Take advantage of all these resources that are made available to you, usually for free or for a small fee. Another important thing to consider is whether you will live locally and manage your property yourself. If not, you will need to find a reputable property management company to take care of that for you.
This area has many charming communities and a large number of attractions that tourists enjoy.
For more information, contact karenrealestate.com and we will help you find the perfect investment for you and make the process of becoming a hotel owner smooth and problem-free.