House Hunting in ... Costa Rica

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A FIVE-BEDROOM MOUNTAINSIDE ESTATE OVERLOOKING SAN JOSÉ

$1.69 MILLION

This mountainside estate overlooks the city of San José and the volcanoes beyond. The house covers 8,100 square feet over two stories; it was built of local volcanic stone in 1995 and refurbished in 2009. Floors throughout are of polished concrete, tinted red in the kitchen. Ceilings are of unpainted Guanacaste wood, illuminated with recessed lights. Exposed volcanic-stone walls in the kitchen have built-in alcoves for the stainless steel appliances and hardwood shelves. A row of square windows runs along the wall above the kitchen sink, which has hands-free faucets by Philippe Starck. In the dining room, one wall is lined with built-in shelves. A glass inset in the dining table offers a view to the wine cellar below. An extensive wine collection and all furnishings are included in the sale. From the dining room, a few short steps descend to the living room where windows on three sides look out onto the lush Central Valley and Irazú, an active volcano.

From the living area, an open-air footbridge leads to the master suite, which has a studio and a walk-in closet as well as an en-suite bath. The bed is on a raised platform; the room has an exposed volcanic-stone wall and a sloping ceiling. In the bathroom, stone-faced steps lead to the spa tub. A wooden vanity is set into a stone wall. An open-air shower off the bathroom is shrouded in privacy by tropical forest.

The 1.73-acre property planted with orange and banana trees also has four separate guest suites. One is beneath the living room and one beneath the master suite; the other two are in guest cottages down the hill from the house.

An outdoor entertainment area next to the pool has a fan-shaped roof, a sound system, and a series of multicolored lights. The estate also has a security gate and a putting green.

The closest restaurants and shops are a 15-minute drive down the mountain in downtown San José. Jaco Beach is an hour and 15 minutes away, and the San José airport is a 40-minute drive.

MARKET OVERVIEW

The property market near Costa Rica's beaches boomed about a decade ago, attracting many American and European retirees, said Kristin Wilson, an independent real estate broker and relocation consultant based in Escazú, a suburb of San José. The market slowed in 2006 and 2007, but it didn't bottom out until the economic crisis in the United States intensified in 2008, Ms. Wilson said, recalling that near the beaches, "sales completely stopped."

Prices in the Central Valley have not fluctuated as much as those near the coast. "Prices were never inflated here," Ms. Wilson said. In fact, foreign buyers are increasingly drawn to the Central Valley and the surrounding mountains. "I'm seeing a trend of people keeping their home at the beach and buying a second home inland," She added. "Living at the beach can be tiring. It can be hot. It can be dusty. It can be rainy."

Attractive homes in the San José area usually cost $1,200 to $1,500 per square meter ($111 to $139 per square foot), while luxury homes in the city's more affluent suburbs can cost at least $2,000 per square meter. The home profiled here is priced at $2,253 per square meter.

Beach properties vary in price depending on location. "Smart buyers can find beautiful homes near the beach in the $250,000-to-$300,000 range," said Karen Ebanks, sales manager for the San José firm Karen Real Estate, which has this listing. Condominiums in the beachfront community of Vista Las Palmas cost $600,000 to $800,000, Ms. Wilson said. But there are more modest homes, too. "There's a lot of inventory available at the beach," she added.

WHO BUYS IN COSTA RICA

Most of Costa Rica's foreign buyers are North American and West European, said Jeff Cane of Karen Real Estate, the listing agent for this property. Canadians currently seem particularly interested in buying in Costa Rica. Although Americans visit frequently, they tend to rent rather than buy, most likely because of skittishness about the economy. Mr. Cane has also seen significant interest among Italian, Belgian and French visitors.

BUYING BASICS

Closing costs are fairly low, amounting to about 3.59 percent of the purchase price, Ms. Wilson said. This figure includes legal fees of 1.59 percent, a 0.5 percent municipal stamp duty, and a transfer tax of 1.5 percent.

Transaction fees are lower on properties owned by a corporation, because there are tax advantages for the buyer when the property changes hands. "It's very common for people to own cars and properties in a corporation because it makes selling them easier," Ms. Wilson said. The property profiled here is an example of this trend. The buyer will acquire the corporation along with the property, and will not have to pay the 1.5 percent transfer tax.

Agent commissions are usually paid by the seller, and vary depending on the region, Ms. Wilson said. Most foreign buyers buy without financing. "It's very difficult for foreign buyers to get financing in Costa Rica," she said. "The banks are very risk-averse here."

Real estate is almost always priced in dollars, according to Mr. Cane.

WEB SITES

San Jose official site: msj.go.cr

Costa Rica tourism: tourism.co.cr

Central bank of Costa Rica: bccr.fi.cr

LANGUAGES AND CURRENCY

Spanish; colones (1 colón=$0.002)

TAXES AND FEES

Property taxes are currently about $120 a year, but a new luxury tax will be based on the size of the property and the kind of building on it. Under the new rules to be enforced soon, Mr. Cane said, taxes for this house will be about $2,000 a year.

CONTACT

Jeff Cane, Karen Real Estate, 1-800-385-1092; karenrealestate.com


This article originally appeared in The New York Times .


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