Costa Rica is a Latin American country with great sandy beaches, volcanoes, and tropical mountains. With the Caribbean on one side, the Pacific on the west, and wonderful warm blue waters teeming with fish, it is an ideal vacationing spot. In fact, it is one of the most visited countries in Central America. The tourist influx has created a booming industry with many resorts, inexpensive hostels, hotels, golf courses, restaurants, casinos, pubs, and locales catering to adult activities. As it is being discovered, more and more Americans, Canadians, and Europeans have chosen to live there full or part time with thousands owning second homes along the spectacular beaches or tropical mountains. Foreigners can own property in Costa Rica and tens of thousands live here year-round because of its democratic government, tropical climate, reasonable land prices, and spectacular laid-back natural environment. All this in turn has led to an increase in Costa Rica real estate prices, particularly along the magnificent Pacific coast where most of the tourists go.

This relative scarcity of available real estate in the face of development has resulted in a boom in the real estate business along the coasts, in the mountains, and in urban areas.

For more and more Americans, Canadians, and Europeans, Costa Rica is now recognized as the ideal place to spend their retirement days. With lots of sunny and sandy beaches, nearly 800 miles of coastline and most beaches virtually deserted, beautiful mountains always close at hand, nice weather, a stable and democratic political system, low crime rates, excellent medical and dental providers and facilities, and high human development indices, it is a prime draw for retirees. An increasing number of investors from around the world have seen the potential of real estate development in Costa Rica and putting money into its real estate.

A number of years ago, the country realized the benefits of sustainable development and tourism. Unlike many other countries, Costa Rica has learned the lesson that unregulated exploitation of resources is ultimately detrimental. Wisely, in the face of sometimes intense pressure, it refuses to allow oil exploration off its coasts. Tropical forests, once cut or burned for little farms, are returning. As more and more of the international community is encouraged to visit, investors from around the globe have found that Costa Rica is a wonderful real estate market. And, indeed, over the last decade there has been a real boom in development along the Pacific coast.

Of course Costa Rica has felt the impact of the severe world wide recession in the States and Europe. Sales of condominiums and single family homes for expats or as second homes in subdivisions have slowed dramatically and in some areas along the Pacific coast cash-strapped Americans are selling their tropical homes at steep discounts.

Every contraction sets the stage for recovery. Costa Rica is expected to boom again due to the continuing tourist influx into the country, the high returns that real estate investment yields here, and the increasing scarcity of land in some places. Over the last decade, many investors have seen the value of their investments soar, though there is in fact a pull-back today in some areas because of the worldwide recession. Even many small investments have proved to be lucrative. Tempering the future boom a bit, though, may be that the fact that property in highly desired areas is becoming increasingly scarce. On the other hand, this may lead to increased investment in prime real estate inland.

The beach properties along the Pacific coast have seen, and will probably see, the largest increase in prices over time. The Caribbean coast remains relatively undeveloped. Certainly prices there, like all of Costa Rica, are rising but not nearly as much as on the other coast (which, of course, means that stress on prices have been less lately than on the Pacific side). And, as more and more Ticos move from the country into the big urban area around San Jose, available prime property has become increasingly scarce. Demand remains strong in the urban areas and, for more and more expats who live in Costa Rica, the amenities and climate around San Jose are proving irresistible.

The author, Victor Krumm, lives in spectacular Costa Rica and has a popular websiteCosta Rica Vacations. Check out the prettyCosta Rica Real Estate