When you live in Paradise, where do you go for a holiday?

Costa Rica, like many other countries, requires folks who are here on a tourist visa to leave the country every 90 days, for at least 72 hours. Back in the day, there never was a question, really. I was working hard, marketing mostly to Canadians and Americans, and my travel was predestined. Now, with The Oaks over 80% sold out and leisure time on my hands, where to go? First stop: San Jose for the 70 something birthday celebration of an old friend at our favorite Italian resturant, Ólivo in La Sabana.

Wow. Culture shock. Cows on the road passes for a traffic jam outside Tamarindo, in Guanacaste. On arriving in Escazu, we found a traffic jam worthy of LA. What the heck!? It was even on Channel 7 news! Seems that the new highway from San Jose to the Pacific coast had advanced sufficiently so that the Authorities decided to raise the toll from 75 colones to 310 colones. This jump ( highway robbery!!) caused everyone and his cousin to exit the highway onto the old road in Escazu, just before the toll plaza. Result: a traffic jam of newsworthy proportions. So far, neither the Authorities nor the public appears willing to give way. This could go on for a loong time. (For perspective, the toll jump in dollar terms is from $0.13 to $0.54.) The good news was that on coming back to Escazu it made for a nice, empty toll road.

Ah, but where to go for 72 hours? Our first trip to Bocas del Toro, Panama, of course. An easy one hour Nature Air flight from San Jose, Bocas is in a time warp. Sort of a cross between the Bahamas and Key West, or how I imagine Key West on food stamps. Laid back, the people a little more aggressive than in Paradise, but with our own private holiday rental condo on stilts over the bay, ten minutes away from everything by boat, solar for electricity, waves lapping under the floor, and total, I mean total, silence. You can check out our genial host at www.bocasvillas.com. Lovely.

Book Costa Rica Vacation NOW!

If you are interested in vacationing in Costa Rica over Christmas or New Year, be forewarned, prime locations are selling out fast. There are only a few brand new properties available this year.

I just checked out a room at The Four Seasons, sold out!

I also just checked out a room at the Paradisus Playa Conchal hotel over New Year, sold out!

Pool view junior suites are available at the open-by-Christmas Marriott hotel at Hacienda Pinilla, $1,499 a night for a junior suite overlooking the pool.

Or, two bedroom/two bath condos overlooking the pool are available at The Oaks Tamarindo, $1,800 for six nights, open since Easter.

ELECTRICITY COSTS: A REPORT FROM THE OAKS TAMARINDO, GUANACASTE, COSTA RICA

I have been reviewing our typical unit owner´s electricity costs at The Oaks, noting that a typical bill during July for a fully occupied unit was $67 CAN for the month. When I asked our on-site concierge, Ana Lorena, for an explanation, she sent me our local electric company´s rates.

Rates are divided into two seasons, "dry" and "not dry". Because 80% of Costa Rica´s electricity is generated by hydroelectric power, rates are 25% higher during the "dry" season from January through June. For an average user of 625 kWh per month, the July low season rates cost $67.75 CAN. VOILA! During the "dry" season from January through June, rates are 25% higher, which would result in an electric bill of $84 per month. So how does this compare with where you live? Here is information from ENMAX for July.

Calgary's Regulated Default Electricity Rate for July 2008

For Immediate Release

Calgary

26 Jun 2008

The default electricity rate for Calgary will rise to 11.99 cents per kilowatt hour (kWh), effective July 1, 2008. Consumers who have chosen a fixed price energy plan will not be affected by this price change.As a result, the electricity bill for a typical Calgary household (using 625 kWh per month) will increase by 15.5 per cent compared with the previous month to $112.31.
Hmmmmm.

Costa Rica Fights Illegal Developments

Green Seal Realty would like to direct your attention to an article written by DAVE SHERWOOD for The Miami Herald
Costa Rica's Environmental Tribunal and scientist’s report illegal developments along the coastline are threatening sea turtles.

UVITA DE OSA, Costa Rica --
When judges from Costa Rica's Environmental Tribunal emerged from the rain forest recently, they were horrified.
In places along Costa Rica's still wild Pacific frontier, rogue developers had slit the roots of ancient trees to hasten their death, clearing the way for ''ocean views.'' Primeval rain forest sanctuaries, home to scarlet macaws, jaguars and blue morpho butterflies, had been flattened for luxury home sites. And backhoes had turned rivers chocolate, read the whole article

FILL´ER UP COSTA RICA

I just filled up my car today in San Jose, Costa Rica. Cost for a liter of diesel was 710 colones, equal to $1.26 Canadian. Looks pretty cheap, eh, compared to a liter of diesel in Calgary, from $1.294 up to $1.469. http://www.calgarygasprices.com/index.aspx?fuel=D Whoaaa! Time to fill her up in Costa Rica!

Or, how about a fill up in San Jose, California. After some high class arithmetic, the cost per gallon of diesel in San Jose, Costa Rica was $4.82 U.S., compared to $4.95 to $5.39 in San Jose, California. http://www.sanjosegasprices.com/index.aspx?fuel=D

By the way, the car, a Toyota Land Cruiser, gets 20 miles per gallon, crosses rivers and eats potholes - a perfect Costa Rica car.

A Slice of Life

Where is this maneuver being practiced?

Unless prohibited, a three-point turn may be used to turn around on a narrow, two-way street. You may be required to make one of these turns on your road test.

To make a three-point turn:

1. Signal with your right directional, then pull over to the right and stop. Signal with your left directional, then check carefully for approaching traffic.
2. Turn left, cross the road so you come to a stop while facing the left curb or edge of the road.
3. Check again for traffic. Turn your steering wheel as far to the right as possible, then back up to the right curb or edge of the road.
4. Stop, check again for other traffic, then pull away from the curb.

TIPS ON LEASING YOUR COSTA RICA CONDO

We finished construction on our first 30 condominium units at The Oaks Tamarindo before Easter, and some of our owners already have begun renting out their units. Out of 30 units completed, 5 units are being rented out on either a short term or a long term basis. We are using the 3 units that we are not selling as model units, a home for our manager of guest services, Ana Lorena, and as VIP units for local dignitaries. One of our owners even has set up his own web site.

First, let’s start by stating the obvious. (It makes blogging so much easier.) Renting is extremely attractive from an economic point of view. Prices are going up while phase two is under construction, making renting an attractive option to cover one’s costs while enjoying the benefits of price appreciation.

We recommend that owners enter into short term rentals whenever possible. Rates are attractive, at $900 per week during the low season, pretty much the same as renting two rooms at the new Best Western Motel one mile down the road. Additionally, an owner can schedule personal and family use during the year, and we can keep a close eye on the unit’s use when it is rented out.

Still, some owners have told us that they believe that long term rentals are more attractive to them, because their income is more stable, and because there is less wear and tear on their units. In our opinion, both beliefs are questionable.

From the point of view of stability of income, the law limits a landlord to only one month’s rent in advance and one additional month’s deposit for damages. As a nice trap for the unwary landlord or lawyer, a tenant can cancel his lease with three months’ advance notice unless the lease explicitly provides otherwise. Moreover, a long term lease really is long term. Under Costa Rica law, every residential lease has a term of 3 years (even if the lease itself says otherwise). So, if you enter into a lease for any term (other than a short term tourist lease), you have entered into a three year lease. Combined with the discussion in the following paragraph, think of this as a form of rent control.

If rent payments are stipulated in a foreign currency, such as U.S. or Canadian dollars, the rent cannot be increased for three years (even if the lease says otherwise). Only if rent payments are stipulated in Costa Rica colones can the rent be increased, once a year, by an amount equal to the annual rate of inflation, up to 15%.

This actually is a pretty good deal for the landlord, since the colon is going up against the U.S. dollar, and inflation is running around 10% per year. So, your lease payable in colones will have two nice annual increases in rent, while your lease payable in dollars is fixed for three years.
What can go wrong? You negotiate a three month lease in October, during the rainy season, for a low rent, payable in dollars. You neglect to register yourself or your company as a tourist establishment, thereby attempting to avoid charging your tenant Costa Rica’s 16.39% sales and tourist tax. You figure, no worries, I am covering my costs, the lease is only until December, and I’ll raise the rent during the high season. WHAMMO. An unscrupulous tenant will stick you with the low fixed rent for three full years, during low season and high. Never mind that the lease says it is for three months. Costa Rican rent control.

What about wear and tear? Isn’t it easier on your unit to have a nice, stable, long term tenant? Well, you own a vacation home, within minutes of the best beaches in the country. So, even though your tenant is a professional architect, engineer or lawyer who lives and works in the area full time,with a wife and no children, he has two parents, six brothers and sisters, and 20 cousins, and their families, all of whom want to come visit him at the beach. And there is nothing you can do about that. Do you think one month’s security deposit will cover three years of wear and tear?

KEY POINTS

· You are better off as a short term landlord to foreign tourists, by and large.
· If you decide on short term rentals, you should register as a tourist establishment, publish

notice of your registration and collect and pay your 16.39% sales and tourist taxes.
Want to learn more, click here?