In the movie “Back to the Future” we saw an example of how beneficial it would be if we could tell the future. The character Biff Tannen gets his hands on printed results from some race track and other sporting events, before they happened, and went on to achieve phenomenal wealth.
In real world economics, the trick seems to be the ability to identify trends and accurately guess what is going to happen prior to it happening. Here in Costa Rica, the real estate market is no different. Discussion and speculation about the future run rampant. Hints & clues are analyzed in a constant effort to make wise buying (and selling) decisions.
It caught my attention this morning when I received the following in an e-mail from an agent in one of the local real estate agencies. He was writing to update us on a client of ours that we had asked him to help with. Without trying, our associate provides a clue as to what the current state of the market is, and perhaps, where it is going.
Thank you for giving me the opportunity to assist you with the property interests of the Schmegerworgs (names changed to protect the innocent).
I feel it is of the utmost importance to give your potential buyers the Tico Times of today, Friday, Sept. 10 newspaper that explains in detail the past and current real estate market place that will back up exactly what I mentioned to them about the market picking up right now and that 2009 was a slower year (article no longer avialble). I feel it is important that the wife understands if we show them a property at a price point that makes sense and feels good in their heart, they need to move forward with a purchase as good deals are selling and we cannot always replace a fire sale or “perfect property” that one lets go by.
I truly feel our BOTTOM market has passed us and current activity with all us of can only prove that.
Whether we sell them something together or if you sell direct, that is all fine with me as I feel there is much business for all of us survivors right now.
Please take care and have a great weekend.
(Its noteworthy that this e-mail is from a “competitor”. One of the really promising aspects of the real estate industry here in Costa Rica’s southern zone is the amount of cooperation between all the agencies.)
The ability to identify “bottom” is the hallmark of a successful investor. It is extremely difficult to do, which explains why so many of us speak in terms of “would’a, should’a ,could’a” when talking about our investment history.
So how can we identify the bottom in the market now?
One of the more prominent factors are that there are less Fire Sale properties on the market now than there were before. All the reports that we are getting from the other real estate agencies in the area are that they are busy. This is not just under $100,000 ocean view lots. It seems that the $300,000 home is a hot item now that won’t last long on the market. There are also a number of larger, more removed parcels, selling. Some of these have topped the $1,000,000 (USD) mark. There is a growing interest in “off the grid” and “community-style” living.
We had one of our favorite developers approach us some months ago and indicate that the recession was finally affecting him, and that he really needed to sell some property. Long story short, since that time he has sold a house and two lots, making him well.
All of the above activity was stimulated by the market ebb & flow. The market was and is down. The inherent quality of the properties that are available in Costa Rica’s southern pacific zone is compelling. The low prices on these properties has caused enough action here to cause us to wonder what all this talk is about a recession – (well, not really, but almost :0) Savvy buyers are here snapping up the deals.
No one knows what the future holds. Things are changing on the global scale, some of which is unprecedented, causing insecurity. We really have no idea what to expect in the future. There is the unmanageable deficit in the U. S. There is China. There is talk about the “double dip” recession. There is global warming and other environmental concerns.
So have we seen the bottom?
Hard to say. However, if you were a fly on the wall of the Guys In The Zone office (or any other real estate office in the zone), you’d hear conversations that would make it seem so. We’ve had a number of folks come through during the down time that have found what they were looking for, but then felt that they had time to decide, to “think about it”. Or perhaps they think that prices will even come down a bit more. Our feeling is that the time to buy has been here now for some time, and may well be passing.
What we do know is that we haven’t seen prices this low and on such a great selection for some years. So, whether “bottom” is behind us, or lies yet ahead, we’re pretty confident that now is a decent time to buy a piece of property in Costa Rica.
* Keith Schenkel of Costa Rica Real Estate Services