Pensionado­s at peace un­der the palms

The easy way of life and at­trac­tive cost of liv­ing are draw­ing more and more of the re­tir­ing kind to Costa Rica. Laura Henderson re­ports

The Daily Telegraph - Property - - Overseas -

The cof­fee shops of Es­cazu are packed on Sun­day af­ter­noons, late lunch­ers chin-wag­ging in the sun. They are not up­wardly mo­bile Lati­nos, but part of a grow­ing cadre of for­eign-born pensionado­s (re­tirees), who have cho­sen to put down roots, to fish, to play golf, to take it easy. It’s not hard to do – the na­tional catch­phrase pura vida (“pure life”) sums up the phi­los­o­phy of Costa Rica.

Bor­dered by Nicaragua and Panama, this tiny repub­lic has avoided the po­lit­i­cal and eco­nomic tur­moil that has char­ac­terised much of Latin Amer­ica – the last rum­blings of con­flict were stamped out in 1948 and re­placed by a stable democ­racy, with a strong growth econ­omy.

Thanks to a decades-old pol­icy of of­fer­ing tax in­cen­tives and other perks to en­tice English-speak­ing re­tirees, the coun­try has at­tracted a high-spend­ing class that is be­ing joined by pre-re­tirees look­ing for a ca­sita un­der the palms.

“Over­seas res­i­dents num­ber about 200,000,” says Richard Bexon, of Costa Rica Hol­i­day. “Most are from the States, but UK in­vestor in­ter­est has also picked up, many buy­ing ahead of re­tire­ment, so they can ease them­selves gen­tly into the sun­shine lifestyle.”

“The qual­ity of life is five-star,” says Diana Duig­nan, who moved from Lon­don to Es­cazu five years ago and now runs La Casa de Ali Baba, a be­spoke furniture store. “In­fra­struc­ture and com­mu­ni­ca­tions in ur­ban ar­eas are ex­cel­lent and the cost of liv­ing is min­i­mal. I get by com­fort­ably on £600 a month. The av­er­age an­nual in­come is only £6,000 with a price in­dex and tax­a­tion bands geared to this level.”

The “grey mar­ket” is grow­ing apace, with re­tirees con­tribut­ing sig­nif­i­cantly to the £800mil­lion a year spent by over­seas vis­i­tors. The early pensionado­s have taken up sec­ond ca­reers, run­ning start-up busi­nesses, b& bs and restau­rants, and now they are at­tract­ing more of the same.

“For­eign res­i­dents reg­is­tered un­der the coun­try’s pen­sion scheme can pay into the so­cial se­cu­rity sys­tem,” ex­plains Willy Driessen, of Ni­cole’s First Re­alty. “A pay­ment of £50 a month qual­i­fies you for full hos­pi­tal­i­sa­tion and med­i­cal cov­er­age, al­though many ex­pats pre­fer to tap into the private health­care net­work and use pub­lic health fa­cil­i­ties as a back-up.”

Res­i­dent sta­tus is se­cured in a num­ber of ways – the two most com­mon “en­try” chan­nels as a pen­sion­ado or a ren­tista (a for­eign prop­erty owner): “Nei­ther pay taxes on money earned out­side Costa Rica,” says Mr Bexon, “al­though re­tirees need an in­come stream of at least £300 a month from a qual­i­fied pen­sion scheme or re­tire­ment ac­count, £500 in the case of ren­tis­tas.”

Not ev­ery­one chooses to ap­ply for res­i­dency: “It re­ally de­pends on how much time you plan to spend here,” says Mr Bexon. “Non-res­i­dents can stay for up to three months at a time with­out a visa, many opt­ing to visit dur­ing the De­cem­ber-April dry sea­son. Some eke out their hol­i­day weeks across the year.”

De­mand from an in­creas­ingly af­flu­ent Costa Ri­can mid­dle class is fu­elling de­mand for pres­tige new­build. “Buy­ers will find huge price dis­crep­an­cies be­tween the prov­inces,” ex­plains Mr Driessen. “In the past 18 months, for ex­am­ple, land prices have risen from £10 per square me­tre to £100 per square me­tre in Cen­tral Pa­cific Jaco Beach, and dou­bled to £75 per square me­tre in Es­cazu in the Cen­tral Val­ley. That said, you can still pick up a lux­ury beach­front apart­ment for about £75,000.”

But beware: there are haz­ards for the un­wary buyer. Most beach­front real es­tate is clas­si­fied as “con­ces­sion prop­erty”, with the first 200m of lit­toral land be­ing sub­ject to strict plan­ning rules. So any po­ten­tial in­vestors should check zon­ing is­sues thor­oughly be­fore buy­ing.

“It’s vi­tal to check ti­tle in­sur­ance when buy­ing an older prop­erty or a plot to build,” stresses Serge Galkine, of agency Trop­i­cal Fel­gate. “Off-plan is more straight­for­ward — al­though you need to en­sure that a de­vel­oper has a fin­ished prod­uct to show as well.”

Best to find an agency through the As­so­ci­a­tion of Res­i­dents of Costa Rica, says Mr Driessen. “They’re an ex­pat mem­ber­ship group and don’t stand to make any money off you. Buy­ers who re­ally want to play safe can al­ways use the ser­vices of a ti­tle in­sur­ance com­pany. It costs about 1 per cent of the prop­erty value, but it’s worth it for peace of mind.”

Pre­vi­ously, the do­main of diehard surfers and back­pack­ers, the north­ern Pa­cific prov­ince of Gua­nacaste has seen a leap in prop­erty prices, with a jun­gle-run of coastal de­vel­op­ments, big-name ho­tels and smaller more spec­u­la­tive en­deav­ours. At the cen­tre of this trans­for­ma­tion is the in­ter­na­tional air­port in pro­vin­cial cap­i­tal Liberia, with daily flights from the US and a grow­ing Euro­pean net­work, in­clud­ing a di­rect char­ter ser­vice from Gatwick just launched by First Choice.

“Tamarindo, Con­chal and Playa del Coco are prime ar­eas,” says Mr Bexon, “but the real bar­gains lie fur­ther north, in Brasil­ito and Playa Jun­quil­lal, where a lux­ury villa with pool will set you back £200,000.

“Prices here are 30 per cent lower than the Mid Pa­cific and South Pa­cific re­gions,” adds Mr Galkine. “In­fra­struc­ture isn’t in place as yet, but lo­cal au­thor­i­ties are work­ing flat out to make it hap­pen.”

The lively beach area of Jaco and the na­tional park of Manuel An­to­nio in neigh­bour­ing Puntare­nas, pop­u­lar with week­end­ing ti­cos (lo­cals), of­fer a hip and holis­tic combo — off­shore is­lands and white sand beaches backed by acres of canopied for­est.

“Con­dos in Jaco cur­rently start from £40,000,” says Mr Bexon. “Ocean view homes with pools go for up­wards of £160,000, but val­ues will shoot up once the Ci­u­dad Colon-Orotina-Caldera high­way from San José opens.” Some way away from off-the-peg tourist re­sorts, hippy res­i­dents in the re­gion’s South­ern Ni­coya penin­sula are also en­joy­ing the trickle of “new blood” into their com­mu­nity.

“We’ve some un­usual of­fer­ings,” says An­drea Drost, of Tropi­sphere Real Es­tate. “Un­der-val­ued front­line lots, for ex­am­ple, sell for £15 per square me­tre near Mon­tezuma. They are owned by a lo­cal busi­ness­woman, but she’s hold­ing out for a ‘holis­tic buyer’. We’ve had one in­quiry from a yoga in­struc­tor, but it’s still early days.”

Stay­ing power: Yan March’s lux­ury beach­front home in Mal Pais is an A-list hol­i­day re­treat for the likes of Gwyneth Pal­trow and Leonardo DiCaprio

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