Costa Rica Expat Tours

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Perez Zeledon – Costa Rica Retirement Mecca?

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Costa Rica retirement mecca

On my morning walk today, through my little “hood” of Quebradas, Perez Zeledon, acknowledging a gorgeous good mountain morning to other expat walkers living in the area, something dawned upon me…

Everybody around here, at least the expats, are sort of old fogies…myself included!

Hey, I’ll be hitting 60 in a couple years. Granted, 60 is the new 40, but I have to tell you, my get up and go seems to have got up and went on many mornings these days.

I got to thinking about the concentration of older folks here in Quebradas and you know what, it makes perfectly good sense. This place really is (or is becoming) a Costa Rica retirement mecca.

By this place I mean the whole of Perez Zeledon, of which Quebradas is only one small part of, albeit a very popular part!

Now, granted, Perez Zeledon is not quite as “on the radar screen” as other more touristic locations that have attracted the lion’s share of expats to Costa Rica. And of course there’s San Jose and the entire Central Valley, which surely has the highest concentrations of them.

Nevertheless, the point of this post is that there’s no reason that Perez shouldn’t be a (or perhaps the) Costa Rica retirement mecca in the near future. And by the looks of things here in Quebradas, it is in fact slowly becoming just that.

Now why is that?

Well, there are many reasons. I’ll express them below in terms of my usual 4 C’s of Costa Rica expat living (climate, convenience, culture and context)…

First, there’s the climate. While the Valle General, where the city of San Isidro de El General is located, can get pretty hot during the day (however, not as hot as the beach, mind you), all you have to do to beat the heat is drive up into the towering and verdant Talamancas for a few minutes. There you’ll arrive at one of the many mountain pueblos, like Quebradas, that have high enough elevations to experience near perfect weather via one of Costa Rica’s famous “micro-climates.”

You see in Costa Rica the weather is fairly consistent, at least temperature-wise, all year long. However, temperature can vary greatly by altitude, if not by season, and here in Perez we’ve got plenty of altitude. The entire valley is overlooked by Costa Rica’s highest mountain, Chirripo, that stands at some 12,536 feet.

Next there’s the convenience factor. San Isidro de El General is the second largest city outside of the Gran Area Metropolitana of the Central Valley. It is also perhaps Costa Rica’s fastest growing one these days. The medical care in San Isidro is varied and quite good. You have the canton’s regional public hospital located here, as well as numerous private clinics and specialists of all types. You’ll also find a surprising number of dental-care options.

We have shopping galore, new eateries opening up all the time, a mall with a cinema, and, wouldn’t you know it, a gargantuan Walmart currently under construction.

We also have an airport that’s slated to undergo a major expansion and become a domestic hub for Costa Rica flights, as well as possibly offering limited international service.

The culture of Perez is also one of the draws that makes it a potential Costa Rica retirement mecca. Unlike the beach destinations, where tourism is rampant, as well as all the good and bad stuff that goes along with that, the mountain culture of Perez is more authentically tico.

Perez is a solid middle class tico canton. Many of the ticos here are farmers, landowners, or business owners. They are really salt of the earth people. Their’s is the predominant culture and I don’t think the steady influx of old fogie gringos, like me, will be changing that any time soon.

On the contrary, the high tourist traffic beach destinations tend to overtake the local culture and become what I often call a “bubble culture” that’s just not what I choose to want to live within. Hey, I grew up in Myrtle Beach, South Carolina, if you know what I mean!

Granted, if you see the context of your Costa Rica expat existence as a beach bum, or surfer dude, then by all means opt for the playas, where you can grab your board and take off for the waves and then party the night away. For us old fogie’s, however, the tranquil mountain culture seems to be more our style.

And we can visit the beach any time we want. In Perez, it’s less than an hour away!

Oh yea, I almost forgot that’s another thing that makes this place so great. You can have your cake and eat it too in Perez, meaning mountains AND beaches!

If you want to learn more about this new Costa Rica retirement mecca, I’m hosting a Costa Rica Southern Zone Expat Seminar in October.

In short, it will be a one-day seminar for fellow expats living in other areas, or folks who just happen to be visiting on the seminar date, who want to know more about the high quality of expat life offered in Perez Zeledon. We’ll have some influential guest speakers and a whole lot of fun. The seminar will be held at the Simple Market, which is one of the new hip eateries providing a cosmopolitan flair to San Isidro city life…

Don’t dicker though, space is limited!

Click on the image below to learn more, or just call me (Scott) at 8559-2686.

Costa Rica retirement mecca

New! – Conventional Mortgages for Costa Rica Expats

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Mortgages for Costa Rica Expats

The usual answer for the question, “can I get bank financing in Costa Rica?,” has been a resounding no.

However, that might be changing!

We had the good folks from ScotiaBank Costa Rica come and give our agency a presentation recently on the topic of their new program for granting mortgages for Costa Rica expats (non-residents).

The ability to actually get a 20 or 30 year conventional mortgage as a non-resident would be a welcome change. The Costa Rican real estate market has been a predominantly cash market, with the only real opportunity for financing coming from the sellers of properties themselves. Usually such seller-financing is available, if at all, only for a short term of 3 to 5 years, at simple interest rates of from 5 to 8%. The terms are completely up to the negotiation between buyer and seller.

From what I was hearing there are a few “catches” with regard to ScotiaBank’s new mortgages for Costa Rica expats program…

These loans are only available to non-residents that meet certain criteria. Probably of most importance is that a non-resident with less than 6 months in Costa Rica can only apply for a mortgage for a vacation home and not a principle residence.

The initial interest rate would be fixed for three years at 8.5%. Afterwards, it would be a floating rate pegged to the New York prime, plus 2.5%. With fixed rate mortgages currently under 5% in the U.S., this dollar rate of 8.5% is quite high and not a fixed rate. Could it go lower than 8.5% in the future? The answer I got was yes, but of course it could also go higher, much higher. In fact, there is no ceiling as to how far it could go!

The terms for these mortgages range from 20 to 30 years, depending on factors like time in (and ties with) country and credit worthiness. You would have to submit a U.S. credit report if no credit had ever been established in Costa Rica. And for practically all non-residents, that would be the case.

The loans can be prepaid without penalty, but only after two years of amortization. Prepaying a loan in the first two years would incur a 5% penalty.

There is an income requirement of at least $5,000 per month. It also matters what percentage of monthly income is for payment of any currently existing mortgages or debts, but I was not completely clear on those percentages. You would have to prove income with tax returns, social security receipts, and the like.

Loan-to-value ratios range from 60 to 80%, depending on a number of factors. The properties will have to be professionally appraised and the “value” in the LTV ratio will be the appraised value. I can see this being a problem in many deals, as often the purchase price and the appraised value will probably not coincide.

Also, the bank will not lend for certain types of constructions, for example stick-built homes. Most homes in Costa Rica are concrete block, or concrete pre-fab, but these days newer and lighter methods of construction are being used and homes are being built in our area with Chilean pine, which is apparently completely insect resistant. However, a Chilean pine-built home would apparently not qualify for a loan. That sucks because the pine homes I have seen have all been spectacular.

Loans would be extended for construction, as well as already built homes.

I asked the question of whether any mortgages for Costa Rica expats had been extended so far, to which I received the quick retort, “of course they have.” However, none of us Coldwell agents have had any experience with this so far. I will be interested in seeing how accommodating this bank will be to our customers. I have found Costa Rica banks to be overwhelmingly bureaucratic and I would imagine the process of getting a non-resident mortgage will be challenging, to say the least.

The advent of conventional mortgages for Costa Rica expats could have a dramatic impact on the Costa Rican real estate market. I am sure if one bank has success with this others will quickly follow suit. One of the “brakes” on this market has long been the fact that such mortgages weren’t available. It is only a small percentage of wannabe expats that have the kind of cash laying around to buy a property in Costa Rica for $300 to $500K, or even more!

I am of course excited about this new development, but will be reporting in the future as to the actual practice of granting these loans and whether or not it indeed is practical enough to make a difference for the investing appetite of the average North American.

Do I Really Need a Costa Rica Corporation?

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Do I Really Need a Costa Rica Corporation?

I get this question a lot. And truth be told, virtually all real estate transactions in Costa Rica by foreigners (certainly all that I’ve been involved with) have been conducted with a Costa Rica corporation interposed. That is, the buyers are invariably recommended to use, and invariably do use, a corporation, or limited liability company, as opposed to making the purchase in their individual names.

For starters, there are two basic kinds of entities most often used for real estate purposes. The first is the Sociedad Anonima, or S.A. It is most analogous to a C-Corporation in the U.S. The S.A. is the most formal of the two entities and requires officers and a board of directors, annual meetings, etc. The other type of entity, more often used, is the Sociedad Responsibilidad Limitada, or S.R.L. It is most analogous to the Limited Liability Company, or L.L.C., in the U.S. It is governed by a manager or managers and the process for maintaining one is less formal than the S.A. Both of these entities afford liability protection for the owners, so there’s not a whole lot of difference in that respect. Attorneys will most often recommend the S.R.L. simply because it’s easier for foreign owners to maintain.

So, why do attorneys recommend the use of a Costa Rica corporation for purchasing Costa Rica real estate?

Reason number 1, most often cited, is the limitation of liability, or liability protection for the owners. That means that if there is some liability inducing incident, such as someone getting hurt on your property, only the assets in the name of the entity can be reached. The owners’ personal assets cannot. That is basically the same reason such entities are used for business purposes in the U.S.

But there are others…

One of the first things a new owner of Costa Rica real estate will want to do is to have all utilities transferred over from the former owner. However, that will be very difficult for a foreigner to do with just a passport and no residency in Costa Rica. The Costa Rica corporation, however, can have those utilities transferred into its name and the owner can accomplish this with a simple document called a personaría juridica that shows the owner is acting on behalf of the S.R.L. The same goes with many other forms of transacting business in Costa Rica without residency. For instance, opening a bank account. Now, it is possible to open a bank account with a Costa Rican bank simply using a passport, but such accounts are severely limited. It is much better to open one in the name of your S.R.L., at least until you obtain your Costa Rica residency.

There are other, more esoteric, reasons that a Costa Rica corporation can be beneficial. For instance, if you die owning Costa Rican property it will be much easier for your survivors to carry on with management and even disposition of the property if you own it with them in an S.R.L., as opposed to your individual name. Otherwise, they will only be able to take such control after going through a lengthy and frustrating probate process in Costa Rica.

For owners who are trying to transact business in Costa Rica while outside the country, the Costa Rica corporation will make it much easier. By authorization of a simple proxy letter, the entity can grant a power of attorney to someone in Costa Rica. The proxy letter can be signed by the owners of the entity while outside the country and such signatures do not have to be formalized for legal use in Costa Rica. That is not true for the granting of a power of attorney from person to person, which would either have to be done while present in the country before a Costa Rican notary public, or a signature out of country would need to be executed at the nearest Costa Rica embassy in the case of a general power, or with the use of an apostille in the case of a special power.

If you are conducting a business with your corporation, as opposed to simply using it as a holding company, or inactive corporation, you might find there are tax benefits. Just like in the U.S., more things can be deemed deductible for business purposes, as opposed to being non-deductible personal expenses, if those expenses are undertaken in the name of the entity.

There are some drawbacks to using a Costa Rica corporation for purchasing Costa Rica real estate. One is that a corporation tax has to be paid each year. However, for most inactive real estate holding companies, that tax is very minimal at only around $120 per year.

Another complication that was enacted into law a couple years ago, but only implemented as of March 1, 2019, is the registration of shareholders (or managers). Each year the president of the S.A., or manager of the S.R.L., must register all owners of the entity, as well as its capital stock. This is further complicated by the fact that only residents of Costa Rica can accomplish the registration process. Otherwise, you will have to grant a power of attorney to a Costa Rican citizen, or resident, to do it for you. There are fairly substantial fines for not doing this registration.

Back in the good ole days parties to real estate transactions would try to reduce closing costs by doing share transfers. The idea being that if the shares of the entity owning the real estate were transferred from seller to buyer, rather than transferring the title itself, you could avoid the transfer tax and other typical closing costs. Also, since the property was probably declared for property tax purposes at a very low level, the new owner could maintain that low declaration and continue to pay virtually zero, or very minimal, real estate property taxes (pegged at a quarter of 1% of the declared value). Those loopholes have been slammed shut and don’t let anyone tell you differently! Any attempt to do the above would be considered tax fraud under current law and can get you into a heap of trouble.

Attorneys will almost always advise foreigners to use a Costa Rica corporation for purchasing real estate. The typical S.A. or S.R.L. can be set up in a matter of days and costs range from $500 to $700.

Important Disclosure: While I was, once upon a time, an attorney in the U.S., I am NOT one in Costa Rica (only a lowly real estate agent). So, please take the above as general guidance with a grain of salt and seek competent legal counsel for all things legally related (such as using and setting up entities) in Costa Rica.

Update: Once upon a time consumers had one choice when purchasing services like water, electricity, telephone and internet. However, nowadays some of that has been opened up to competition. Probably as a result, it is now much easier to open up accounts for utility services, telephone and internet in your personal name with just a passport. Corporations are really no longer necessary for this purpose.

New Costa Rica Capital Gains Tax

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Well, it’s official now, or almost. As of July 1, 2019, there will be a new Costa Rica capital gains tax of 15%.

Many, especially realtors, are aghast at the nerve of the Costa Rican government for doing such a thing. The real problem the government faces, however, is a burgeoning budget deficit. At least the current administration of Carlos Alvarado, unlike the do-nothings of the recent past, is doing something about it.

Capital gains taxes have never been very popular with the upper echelons of whatever society that decides to enact them. After all, the rational goes, the ordinary income that bought the investments, the sale of which generates the tax, has already been taxed! At least, that is the general argument from the right. From the left, the idea for the tax is a way to “soak the rich.”

In the U.S. the capital gains tax has long been a hot-button source of vehement contention between the left and right. Any attempt to raise the tax is decried by the right as socialistic and any to lower it by the left as catering to the rich. The tax in the U.S. is a much more complicated mess than what is being proposed in Costa Rica, with vast differences in the rates on long versus short-term gains and a myriad of loopholes. It is one of the areas most cited in the progressive outcry against “crony capitalism.”

So, who will be most affected by the new Costa Rica capital gains tax?

For starters, a personal residence is exempted from the tax. Now, hold on you loop-hole-loving capitalists…that doesn’t mean your second and only home in Costa Rica will qualify as a “residence.” To be honest, the particulars of what constitutes a residence haven’t been completely ironed out, but I would suspect that the Costa Rican government will be wise enough to close any loopholes that would allow second homes owned by North Americans in Costa Rica to escape the tax.

The average middle-class Costa Rican doesn’t own anything other than a residence, so the tax really isn’t aimed at them. It is aimed at the upper classes who own investment properties. And it is especially aimed at foreign investment in Costa Rican assets, the types of investments made with foreign-sourced income that never received any form of taxation in Costa Rica to begin with, thereby throwing water on the double-tax argument.

As I stated from the outset, the tax will be 15% of the gain from the sale of a capital asset. Capital asset certainly encompasses either real estate, or the shares of a Costa Rican company owning real estate. It will be important to be able to document clearly the cost basis in the asset being sold. Many owners of properties in Costa Rica have for years declared a far lower value for property tax purposes than the property in reality has. Those folks are going to have a hard time boosting their cost basis in order to lower the tax, which is 15% of the difference between that cost basis and the realized sale price.

The government has provided a one-time “exemption” for properties that were owned prior to the enactment of the tax, or prior to July 1, 2019. For those, the owners can opt to pay a 2.25% tax on the gross sales price, as opposed to 15% on the gain. For instance, if you sold a property for $200,000 and had a $150,000 cost basis, it would generate a $7,500 tax on the $50,000 gain (at the 15% rate). However, if you made the one-time election, you would only pay 2.25% on the $200,000, or $4,500.

The new Costa Rica capital gains tax must paid 15 days after the closing of a sale.

Will this tax put a damper on North American real estate investment in Costa Rica? I don’t think so. In fact, Costa Rica is simply joining the ranks of many other Latin American countries that have already implemented such a tax (like Colombia, Ecuador, Panama, etc.).

I believe that the typical life-style-related reasons North Americans often make such investments will overcome the future sting of having to one day pay the tax. However, what it might in fact do is put a damper on the real estate flipping that often goes on in Costa Rica’s hottest real estate markets.

Costa Rica, like any other sovereign nation, has the right and indeed the obligation to take care of its internal affairs, even if doing so might affect outsiders negatively. Even though I’m a realtor down here, I applaud the move by Costa Rica to get its affairs in order. It will remain to be seen, however, if the implementation and, more importantly, enforcement of this new Costa Rica capital gains tax will actually make a difference for the good of the country.

Costa Rica Expat Creativity

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I never was much of a creative person until I moved to Costa Rica. Before I came I’d been a tax lawyer and then owner of a small M&A advisory firm. Not very creative stuff, unless reducing corporate tax bills strikes you as being a creative effort. I guess it can be. However, get too creative with that stuff and you might wind up with more creative time than you ever bargained for, behind bars!

What is creativity anyway?

One way, maybe the most common way, to answer that is that creativity is making something from nothing. But in reality that rarely ever happens. Usually there is some sort of something there and the creative person comes onto the scene and adds to or changes it, making what was seem entirely fresh and new, original even.

Take Andy Warhol’s Campbell’s Soup Can paintings, for instance. Definitely not original in the sense of something from nothing, but nevertheless a very famous series of creative endeavors indeed.

Shortly after arrival to Costa Rica, something sparked the creative impulse in me like living in the U.S. never did. In my case, the creativity came in the form of writing.

I started blogging back in 2005. I’d founded a tour outfitting company and kept most of my writing geared towards Costa Rica tourism-related topics. And then gradually I began writing about other stuff as well, stuff that just hit me early in the morning when I would usually sit down to write.

One of my first blogs was entitled 365 Reasons I Love Costa Rica, which later morphed into, simply, Costa Rica Guy. Many of the older posts appearing in this blog are from those initial efforts. The idea for 365 was to write a different reason every day for a year. But as I wrote the reasons began to gain more and more distance from Costa Rica as the seminal topic. I delved into philosophical stuff, political stuff, and environmental stuff, among other more trivial topics, always attempting to have a Cost Rica tie-in, often very loosely woven.

Later on I started a much more philosophical blog entitled Revolutionary Misfit. I have recently backed off writing in that one because the motivation to do so these days always seems related to politics. And, well, I’d rather spare myself. Nevertheless, there are years of posts in that blog that tell the story of how I came to think the way I currently do.

I believe that Costa Rica, or the expat life in Cost Rica, was, in large part, my muse. I’ve written before about how Costa Rica shifted my paradigm from being quite conservative (politically and otherwise) ideologically to, well, sort of a wild-eyed lefty, or progressive as I like to call myself these days. And that shift would often be evident in my almost daily writing.

About the same time that I launched the Misfit blog, I also began to write eBooks. I wrote a number of them, all still available on Amazon. None have reached any “best seller” list, to put it mildly. However, I’m proud of every word written. Getting all that out of the brain and into cyberspace can be a heart-wrenching, soul-revealing and vulnerability-enhancing endeavor.

Right now I have a memoir of my Costa Rica expat life ready to be edited and perhaps one day published. I’m in no hurry, however, and continue to mull over it and massage the content from time to time, maybe even add to it as my Costa Rica story continues to unfold.

My latest creative effort is a podcast. It’s called the World Changers Expat Podcast. The idea is to interview expats, not just in Costa Rica, but around the globe, who are using their creative impulses to make a difference in the world. I’ve so far recorded three episodes. The goal is one per month.

I’ve seen Costa Rica expat creativity displayed in all sorts of ways. Some do it through an art form (writing, painting, sculpting, music, etc.), arts and crafts, or some type of well-being therapy. Others do it by starting organizations geared towards helping people, animals, or the planet. A lady I recently sold a property to is getting creative via her Tibetan bowl therapy. All you have to do is go to the weekly market, or feria, in Tinamastes and you’ll see a whole bunch of Costa Rica expat creativity unleashed.

Of course, many of our resident expats were creative before ever coming to live in Costa Rica. Others, I’d venture to say, not so much. My Tibetan bowl friend was herself a real estate agent before Costa Rica. Now, there are some ways to “creatively” do real estate, but I’ve found that the pursuit of money and the material it buys, is a sure way to dampen the creative impulse. In fact, I was far more creative before I ever got involved in real estate and I’m now trying to find my way back to the level of creativity I was enjoying in Costa Rica before I became a realtor, despite my ongoing need to make a buck here and there.

I believe we humans are at our core a creative species. Perhaps the only species on earth whose creativity doesn’t merely flow from instinct, but from some deeper region of the brain and the consciousness it either produces, or acts as a kind a radio receiver, allowing us to tune in to a universal consciousness, or perhaps both.

The bottom line is that if you’re contemplating becoming a Costa Rica expat get ready to be inspired creatively. There’s something about this place that just does that. I don’t know if it’s the overwhelming natural beauty, or just the impact (perhaps “shock” is a better word) from living somewhere as strange to the senses (including sense of logic) as Costa Rica can often be.

Probably it’s a little of both.

Don’t plan on coming down here and just vegging out on ocean and mountain views. Open up your mind and let the creative juices flow. The world can stand to benefit from less human effort towards increasing “GDP” and more towards making the world a more beautiful and humane place for its inhabitants.

The world needs your unique brand of Costa Rica expat creativity.

Perez Zeledon – A Costa Rican Growth Story

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Ciudad de las mujeres lindas

Back in the day, we’d make the trip up from Dominical to San Isidro from time to time. Usually because we didn’t want to retraverse that god-awful stretch of still then unpaved road between Dominical and Quepos.

I remember on one of those trips, maybe my first, waking up early and walking around town. I believe it was Saturday. It seemed like any other medium-sized Costa Rican town, with one notable exception. And that was the seemingly over-abundance of beautiful Costa Rican women.

I’ve since learned that the canton (or county) of Perez Zeledon, and more specifically the city of San Isidro de El General, is famous for its gorgeous girls. And what’s even better, the rumor is that the ratio of women to men is astronomically out of whack. Now that I’ve lived here for quite a few years, I can attest to the former claim, although I’m not so sure if that supposedly outlier ratio is really statistically significant.

I moved to Perez back around 2011, or about 8 years ago. I just got fed-up with the big city (meaning San Jose) hustle and bustle. I wanted to go somewhere with mountains and close-by beaches and this place fit the bill perfectly. The feminine fame that it boasted didn’t hurt either. I was on the outs and separated from my wife at the time (we’ve since long reconciled and are living very happily together) and just wanted to get the hell out of dodge.

My first rude awakening came one day when I parked downtown in an area marked yellow, or not for parking. I admittedly did notice that, but thought what the heck, this is podunksville and surely no one will notice or care. Well, I was dreadfully wrong. I returned to a car with no license tags. To be honest, it took me a couple of days to even notice it. At first I thought I’d been robbed of the tags, but a friend told me that more than likely they’d been taken by the transito (or traffic police). I went to verify and sure enough they’d been taken. On top of that I had a fine to pay of around $500 to get them back. I paid the fine and then was told that the tags had been destroyed and had to be replaced.

Anyway, you get the message – bienvenidos a podunksville!

My things have changed in a hurry. I learned my lesson about parking where I shouldn’t. During a bad storm back in 2015 the famous Cristo de Perez (the statue of Christ that overlooked the city – see photo) suffered a lightning strike and burnt to the ground, much to the dismay of many devout Catholic residents.

And I have fallen deeply in love with this place.

These days San Isidro is gaining fame as the second largest city outside of the San Jose/Heredia/Alajuela/ Cartago metropolitan area or GAM. And it must certainly be the most important Costa Rican growth story going these days.

And for good reason. Where else in Costa Rica can you find the highest mountains and one of the most gorgeous coastlines (the Costa Ballena, with popular beach areas of Dominical, Uvita and Ojochal) in such close proximity?

Answer: nowhere.

Many have heard of Costa Rica’s unique “micro-climates”, or places where you can beat the heat and find near perfect weather just by driving up the hill a ways. Well, there’s no place where that’s more true than Perez Zeledon. I live at 900 meters altitude (close to 3,000 feet) and the weather is very temperate. However, down in town, about 7 minutes away, it can get much hotter. That’s because it’s about 300 meters lower down there in the valley. And I’m only 40 minutes from the beach at Playa Dominical, where Central American sea level can be as hot as what you might imagine, being this much closer to the equator than, say, North Carolina.

The city of San Isidro de El General and indeed the entire canton of Perez is undergoing a major growth spurt. Evidences of that are everywhere. We now have one of the nicest 5-star resorts in all of Central America (Hacienda AltaGracia) in the area of Santa Teresa de Cajon, about 30 minutes out of town in the folds of Cerro Chirripo, Costa Rica’s highest mountain. We have an airport renovation project soon to be underway, which will transform our little airstrip into a modern domestic (possibly even international) airport with flights to all areas of the country. We have new stores and restaurants opening weekly. I believe there are like 5 sushi restaurants now. And to top it all off in alarming fashion, we have a new Walmart under construction!

We also have the area’s regional public hospital and lots of private care options as well, via private clinics with all manner of specialists, and a multitude of dental care options. And, finally, we have our “small” (or tiny mall) with a movie theatre!

I certainly don’t want to see my little piece of paradise turn into what I came here to escape. But the Costa Rican growth story that I’ve been witness to so far will only make the convenience factor of living in those gorgeous mountains just outside of town, well, all the more convenient.

There are surely many more chapters to be written in this Costa Rican growth story that’s Perez Zeledon and its “gateway to the southern zone” city of San Isidro de El General. I’ve been selling real estate in the area as a Coldwell Banker agent for several years now. I honestly believe there is a lot more room for growth around here. We need more jobs to lure folks from the big city and airport projects, Walmarts and the like can do that trick.

More and more would-be expats seem to be hearing about and exploring the area. And why not? Here you can live near a pretty darn killer city, be in a perfect climate, be surrounded by incredible flora and fauna, and be close enough to the beach to go surfing after breakfast and make it back by lunch!

There’s just no way around it, the southern zone of Costa Rica is where it’s at these days and Perez Zeledon, the Costa Ballena coastline, and the famed Osa Peninsula are three very solid reasons why.

Reveling in Costa Rica Expat Inconspicuousness

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I guess many of you probably think that most of us expats down here are hiding, or running, from something. Truth be told, some of us are. Those are the ones that tend to show up in the headlines of the American Expatriate newsfeed (that is, once they’ve been discovered).

But that’s not the majority of us, thank god. No, the rest of us just want to live our lives substantially free from interference…in the form of rules, regulations, or even societal norms. Because we expats are far from normal. I mean who in their right mind would uproot from the country of their birth and move to some strange exotic land, full of mystery, adventure and romance?

Sounds horribly frightening, doesn’t it?

Oh wait a minute, so you feel enticed by that thought, eh? Well, in that case, you might want to come down and see for yourself what’s going on in this little slice of paradise.

I just hope I’m not encouraging “too many” of you in that direction…

I’ve noticed that the mountain expats are reveling in Costa Rica expat inconspicuousness to a higher degree than the beach ones. We’re kind of a rugged, individualistic lot up here in the proverbial holler. The thought of keeping up with the Joneses is just not something we worry about too much, or at all. I haven’t seen too many mountain expats that I’d say were guilty of being “show-offs.” In fact, most of us would rather never even show up…at all…that is, on the radar screens of nosey neighbours, back home annoying acquaintances, and certainly not da gubment.

The beach is a different story…probably because there are more of us down there, or maybe it’s just the heat (or various and sundry substances) softening the brains of the beach-minded. Now lighten up, just kidding there beach expat!

But, in reality it does seem, at least to me, that there’s a higher degree of preening pretentiousness down there amongst the beach crowd expats.

As for me, I’ve never enjoyed standing out in the crowd. In that regard escaping to Costa Rica and reveling in Costa Rica expat inconspicuousness has suited me very well. I wear it like a well-worn coat on a cold winter’s night. I feel very comfortable in my Costa Rica inconspicuousness. I’ve grown so accustomed to it that I’m afraid living in the U.S. could never suit me now. So, I guess I’m stuck here.

Of course I’m posting this to a real estate related blog and I am a real estate agent down here. In that regard, there’s a limit to which I can remain both profitable and inconspicuous. But life is filled with such dilemmas and we just have to learn to live with them, wherever we might find ourselves.

Another reason to revel in Costa Rica inconspicuousness is the alarming, and growing, incivility back home.

No, no, no…it’s better to remain inconspicuous, living in the moments we and our circumstances create for ourselves. It’s better not to meddle in the business of others and, to the extent we can, make sure they don’t meddle in ours. That is the essence of “pura vida” living. And Costa Rica offers that. It offers the ability to get away from all that meddling and incivility.

The incivility is, more often than not, the indirect result of the meddling, wouldn’t you agree?

Better to just live your life the way you see fit without anyone looking over your shoulder or through a magnifying glass, trying to discover ways to rationalize how much better they have it than you do.

My last post provided some insight into my Costa Rica story…the how’s and why’s behind my Costa Rica presense. Of course when I first arrived I was more than ready to make the big splash, as we Americans often desire to do. However, gradually I faded into the dense jungles of Costa Rica inconspicuousness.

Now, if you read that post you might get a good idea of what motivated me in this direction, away from any semblance of limelight. And boy do I feel a whole lot better and less stressed as a result of that momentous paradigm-shift. I honestly believe it has added a decade or so to my time on the surface of this old revolving rock.

If you’d like to revel in Costa Rica expat inconspicuousness with me, I highly encourage a Costa Rica expat tour for starters.

Geez, I guess I just potentially blew my cover…

I realize this has been the kind of post generally written when one can’t honestly think of anything actually worthwhile to write about…

Nevertheless, I hope you catch my drift…

Pura Vida!

My Life in Costa Rica – A Warning How Not to Do It

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Well, I’ve heard it’s really a nice place…

That’s what Doris Bray told me late in the year 2000. I’d been on the hunt for deals since the dot.com bubble burst and I’d stopped by to pay her a visit. Doris R. Bray is a founding partner of the Greensboro, N.C. corporate law firm, SchellBray. I was also a lawyer, but had decided to exit the profession in pursuit of a career as a mergers and acquisitions advisor. I’d done pretty well for a while selling small companies in the internet space, but that all dried up at the turn of the century. I was hoping to find some deal flow through Mrs. Bray and she indeed told me that she knew a guy who owned a private for-profit university in Costa Rica. My knee-jerk response was to ask her,”where the hell is that?” Only moments later I followed that up with, “isn’t it dangerous down there?”

To make a very long story short, I ended up representing the owner of that private for-profit university, currently known at Ulatina (then Universidad Interamericana), which on my birthday, December 5, 2003, was sold in a deal orchestrated by yours truly to Laureate Education, Inc. (formerly known as Sylvan Learning, Inc.).

During the course of that deal my life changed dramatically. Due to some personal failures on my part, I found myself separated from my first wife. I’d also fallen deeply in love with this formerly mysterious country called Costa Rica.

Incidentally, this post is an abbreviated version of the full story of my life in Costa Rica, which will soon be memorialized in my self-published memoir, likely to be entitled, A Coming of Age in Costa Rica.

I started living full-time in Costa Rica around 2006. The money from my big deal was dwindling due to the divorce, the payment of debt I’d racked up in the 2-year course of being focused on completing that deal (and not much else), and my launching a tourism business in Costa Rica. I decided traveling back and forth was just not economically feasible, so I moved lock, stock and barrel to San Jose, Costa Rica.

And there I lived until early 2012 when I moved to the southern zone, to the town of San Isidro de El General. Since 2004 I’d remained wholly focused on the tourism business I founded on the heals of my deal. I married a Colombian-borne, but Costa Rica nationalized, woman of about 8 years my younger in 2009. We had our ups and downs in the first few years and I made the move out of San Jose to the southern zone during one of the down times.

It proved to be a good move. Initially I thought it would be wise to live in the city, with its country-central location and well-developed communications infrastructure. Most of my tourism clients would arrive into the San Jose international airport and it was nice to be able to provide the personal touch of meeting them there. However, the traffic, hustle, and bustle of the city gradually began to get under my skin. I decided to haul ass to a place that had both of the two things I loved most about Costa Rica, its gorgeous mountains and beaches.

My wife, Lily, and I were able to patch things up and she ultimately moved south as well. However, she wasn’t as happy as I was living in the “remote” southern zone. Also, as Costa Rica grew in stature as a world-wide tourism destination, so did the competition as “big-box” tourism related companies began to hone in on the opportunity. As a result my webpage all but disappeared from the Google search rankings and my sales and income took a corresponding dive.

We made the momentous decision for me to attempt to repatriate back to the U.S. in early 2015. The decision proved to be disastrous for a myriad of reasons. Later that same year I returned to Costa Rica, more than a little worse for wear, with nothing more than the shirt on my back, a surfboard, and, luckily, a car that was waiting on me upon arrival. We’d sold pretty much everything before taking off for the States, except, thankfully, that old car.

I dabbled in this and that trying to find my bearings and generate some income. Nothing seemed to pan out until one day the idea dawned upon me to call two old acquaintances, Daveed Hollander and Jimmy Drews of the Coldwell Banker real estate office in Dominical. I’m not sure if they saw in me a potentially stable agent with deep knowledge of Costa Rica and a rare permanent residency, or if they just took pity on me, but whatever it was, they invited me on.

For the next year and a half I paid my dues, struggling to complete my first sale as a real estate agent. Things began turning around for me in mid-2017 and they’ve gotten increasingly better ever since. I am now settled-in for the long-haul as a Coldwell Banker agent operating out of the Dominical office. I may be opening my own Coldwell office in La Palma, on the beach road between San Isidro de El General and Dominical very soon.

I’m very happy these days living in the mountains above San Isidro de El General and working as a real estate agent serving the southern zone’s mountains and beaches. My wife and I also enjoy taking month-long trips to her home country, Colombia, each year.

I’m writing, quite candidly, about my life in Costa Rica because I want you to know me a little better. Of course, if you want more detail (and believe me there’s a whole lot more of that), you’ll just have to stay tuned for the book. It’s currently gathering digital dust waiting to be sent to an editor. Hopefully, by the end of the year it will be live on Amazon.

My life in Costa Rica over the past two decades has been quite a ride. I don’t recommend anyone do it like I’ve done it. It’s certainly better to have your ducks in a row to a far greater extent than I ever did.

I guess in a sense, Costa Rica sort of found me rather than the other way around.

Nevertheless, I couldn’t be happier!

P.S. Just in case you were wondering, I’m following my own advice in that inconspicuous post and therefore that book is still gathering digital dust as of September 2022…

Is It Time to Make Your Costa Rica Expat Move?

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Costa Rica Expat Move

Here are 5 reasons that the answer might just be yes…

A Shaky Economy…

Speaking of shaky, you’re probably shaking your head wondering what the hell I’m talking about. The stock market has soared under Trump (well, except for December). Taxes and regulations have been cut to the bone. In short, for some, business is booming.

However, as one of the greatest investors of all-time, Ray Dalio, will readily tell you, America has become the tale of two economies…one for the very rich and another for everyone else. Even though the economy has “boomed” under Trump in many measurable respects, inequality has also increased, as has personal and national debt, and scientific research, especially in areas of technologies that can improve the environment and the quality of life for future generations, has been gutted.

Ray Dalio likens the current economy to the year 1937, when the world was on the brink of war. Does that mean that the world is headed towards war in the next few years?

Well, these days world wars aren’t so likely, since most rational heads of state sort of know that no one would come out a winner in a world wide nuclear conflict. Nevertheless, growing worldwide economic equality, along with population displacement due to civil strife and, increasingly, the effects of global warming, will be a destabilizing influence on the U.S. and worldwide economies for the foreseeable future.

Does Costa Rica offer an escape from all that? Costa Rica has long been the “Switzerland” of Latin American and has kept its nose out of the messes that its Latin country neighbors seem to repeatedly get themselves into.

I guess what I’m saying, more than anything else, is perhaps it’s time to get out while the getting’s still good.

Prices Still Relatively Low (in some areas)

Costa Rica is certainly not the cheapest country in Latin America. I just got back from spending several weeks in Colombia and it indeed is cheaper there, for the most part. Nevertheless, real estate prices in some areas are still very good. Property prices in high tourist traffic areas, such as Costa Rica’s many popular beach communities, which suffered greatly in the 2007-8 crash, have crept back up to a large degree.

But there are areas off-the-beaten-path that remain quite appealing. One of those areas is my own home in Perez Zeledon. This area really has some great things going for it: like the city of San Isidro de El General (Costa Rica’s second largest outside the GAM of San Jose); the highest mountains in the country, which boast incredible panoramic views and host a dazzling degree of diversity in flora and fauna; and you can live in a mountain climate and still be less than an hour from one of Costa Rica’s most gorgeous coastlines, the Costa Ballena (with beaches like Dominical, Uvita and Ojochal).

There are great values to be had in Perez Zeledon. Here you can find a nice home on some acreage with a perfect year-round climate and great mountain views (with maybe even a glimpse of ocean) for less than $300,000. And what’s also great is that you’ll be only minutes from a super cool city with all its conveniences and less than an hour from the beach!

Varied Inventory to Choose From

Costa Rica is a tiny country, about the size of West Virginia and with less than 5 million inhabitants, about half of whom reside in the “gan area metropolitana”, or GAM, of the capital city, San Jose.

Even so, there is so much diversity to choose from in terms of urban living, verdant mountains or sparkling beaches, cool, hot, or steamy hot jungles, lakes and rivers, etc., etc., etc…

So, no matter what type of expat life you think you want to live, you can probably find the perfect spot somewhere in Costa Rica. I wrote an article some time ago with a framework to help you make that decision. I call it the 4 C’s of Costa Rica expat living.

While I am not familiar with the real estate inventory in markets outside of the one where I work, the mountains of Perez Zeledon and the Costa Ballena, I can at least tell you that in our market you can find pretty much anything you might be looking for. Well, there is one exception to that, which is beachfront property. The topography of our area doesn’t really lend itself to that, since we have mountains that end right at the shoreline, more or less. For beachfront stuff, the beaches of Guanacaste are probably a better (albeit pricier) bet.

However, if you’re looking for a house in the hills with a great ocean view, we have it. If you’d prefer the convenience of condo living, we certainly have some outstanding product. Want to be close to a growing city with all its conveniences? We have one in San Isidro de El General. Want to buy some acreage in the mountains for horses or other livestock, with a nice home and maybe even an ocean view? Yep, we’ve got you covered there too.

Exchange Rate in U.S. Dollar’s Favor

During the past year (2017) the Costa Rican colon exchange rate has soared to levels against the U.S. dollar that I have never witnessed in my almost two decades here. At the moment of this writing it’s around 600 to the dollar. Historically, it’s always been closer to 500. So, for folks coming to Costa Rica with dollars to spend, Costa Rica has gotten a bit cheaper. The exception to that, however, is the Canadian dollar, which I believe right now stands at about .75 of $1 USD.

Political Turmoil at Home

I don’t like to get political in this blog, or in any regard when the subject is Costa Rica expat living. However, you can’t deny the fact that the political situation in the U.S.A. is appalling and seems to get worse by the day. That is spawning deep divisions in society. In short, America is increasingly becoming not such a nice place to live these days.

Well, I can tell you Costa Rica will be a breath of fresh air in comparison. Costa Rican society is largely apolitical. They have their big election party every four years, which is colorful and festive, but hardly divisive on the level that we’re currently seeing in the States. And the expats around here, while they do harbor their own political sentiments, generally they keep those to themselves in an attempt to live what we call down here a “pura vida” lifestyle of live and let live, regardless of political persuasion.

So, there you have it…five good reasons to make your Costa Rica expat move sooner rather than later.

And I’m here to help!

How Safe is Costa Rica – Really?

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How Safe is Costa Rica

How safe is Costa Rica – really? I get asked that question a lot and I mean an awful lot.

So, I thought I’d write a post providing my opinion on this important issue. In the future expect to get a link to this post if you ask me the question…

In Terms of Economic Security…

The general question of safety can be taken a couple different ways. The first one that I will address is economic security, i.e., is Costa Rica a safe place to invest your hard-earned dollars? I’d imagine most folks who ask are more concerned with the second part, which concerns physical and material security. But, nevertheless, I thought it pertinent to address the economic aspect as well.

Historically speaking, Costa Rica has been a relatively safe place to invest. Now, there are a lot of ways to do so poorly and many do make bad, or even stupid, investment decisions and lose their shirts in the process. This blog has many posts written to help you avoid those mistakes. But, generally speaking, Costa Rica has been a safe place for foreign investment over the years.

Could that be changing?

Well, Costa Rica is having a bit of a deficit crisis these days. And unlike the United States, Costa Rica doesn’t likely have the ability to quantitatively ease its way out of the mess. The new presidential administration of Carlos Alvarado is taking steps to correct the problem, but those actions are being met with widespread public resistance. We are now in the umpteenth week of a national strike against these austerity and tax measures aimed at tackling the deficit. It remains to be seen if the government can deal with this in a way that avoids major disruption.

As a result of all that, together with current strength in the U.S. dollar, the Costa Rica colon has reached an all-time high of around 610 colones to 1 greenback. That’s not so good for the average Costa Rican as inflation is ticking up as a result. But it can be good, at least in the short-term, for foreign investors buying Costa Rican colon denominated assets with dollars.

What’s my opinion? Well it’s mixed. Costa Rica needs to correct its fiscal deficit. If it doesn’t, it will put further pressure on the economy and that could ultimately be bad for anyone living here, foreign or local. However, right now Costa Rica remains a good and safe bet and with the record strength of the dollar against the colon, a relatively cheap one too.

OK, that’s enough with the boring economic stuff…what about…

In Terms of Physical and Material Security…

If you’re from the U.S. and have never been to Latin America before, you’ll probably be surprised to see that most homes, especially in urban areas, have walls around the periphery, sometimes adorned with razor wire, and iron bars on all the windows. I often get asked by alarmed gringos if that signifies a lack of safety.

Well, yes and no. Let’s start with the good news. In part it’s cultural and you’ll see that phenomenon not just in Costa Rica, but in just about any Latin American country, or at least all the ones I’ve been to. Nevertheless, it does have a practical aspect. First of all, Costa Rica is a poor country and most of its citizens live in a state of poverty that even the poorest in the U.S. couldn’t imagine, from a material standpoint at least. That level of poverty can lead to desperation, which can lead to property crime. Secondly, many older Latin Americans have experienced, first or second-hand, the specter of social upheaval, or even outright revolution. And if there’s a revolution erupting and an angry proletariat amassing in the public squares, having your home set up like a fortress does make a bit of good common sense.

Bottom line, there’s a little bit of culture and practicality mixed in with the fortress-like architecture.

Costa Rica is a gateway for drugs moving from South America to North America. It probably will be for the foreseeable future, or as long as the “drug war” continues unabated. That means that at any given time there are some very unsavory characters out there who wouldn’t think twice about using extreme physical violence to protect what they deem is their coveted piece of the drug trade pie. Now most Costa Ricans have nothing to do with this…by the way, same goes with most Colombians. But even so, the average peace-loving Costa Rican (or expat living among them) can get caught in the crossfire of rival drug cartels and gangs. That happens more often in the San Jose metropolitan areas and also in port towns, especially Limon. But it can happen anywhere to anyone.

Costa Rica has its own immigration issues. I’ve heard figures as high as 500,000 for the number of illegal immigrants living in Costa Rica, many from Nicaragua, as well as other countries. And as the strife increases in neighboring countries to the north and south, that trend will likely continue and grow. This can lead to problems with crime as some of those moving into Costa Rica are either criminals when they get here, or resort to crime for survival reasons. Oh my god, I sound like Donald Tump! Practically speaking, the uptick in crime in San Jose may indeed have a lot to do with this immigration influx. I don’t know that to be the case, but wouldn’t be surprised if it weren’t. Bottom line is that just like in any large metropolitan area in the U.S., or anywhere else, there are crime issues and you have to be wary of them.

There’s another aspect of physical and material security that most realtors won’t tell you about. And that concerns what I call “culture clash.” There are some areas of Costa Rica where foreign investors have moved in and sort of changed, or attempted to change, the cultural landscape. I am thinking chiefly of places like the Guanacaste “gold coast” and to a lesser extent the central Pacific around Jaco and even my own southern Pacific area known as the Costa Ballena.

For starters the coastal areas of Costa Rica, as beautiful as they are, tend to historically be some of the poorest areas of the country. Job opportunities are few and far between, infrastructure can be very spotty, and most in these coastal areas live off the land and sea. When you couple that with an influx of wealthy North Americans moving in and creating things that these folks can hardly afford, it tends to create resentment and that can lead to outright culture clash. This has lead to problems, mainly with property crime, but sometimes even with physical violence in the form of home invasions and other strong-arm robbery tactics.

The North Americans who invest in these areas learn quickly to take measures to avoid problems with security systems and even armed guards. I am not trying to paint an exaggeratedly negative picture, but I do want to be realistic and tell you the truth. Am I trying to say don’t invest in those areas? No, not at all. Just know the landscape and what you’re getting into and don’t be naive about the risk of encountering problems.

So, what’s my overall opinion on Costa Rica safety. How safe is Costa Rica – really?

It’s safer than virtually any other country in Latin America and I’d say the pros of investing and/or living here far outweigh the cons and that includes the safety (or lack thereof) con.

Furthermore, the way things are going up north lately, I’d say Costa Rica is a degree or two safer than what you’re apt to experience on main street U.S.A.

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