San José, Costa Rica, since 1956

San Juan del Sur Rides Second Wave

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SANJUAN DEL SUR – Surfers  bobbing in the lineupoff the beach at San Juan del Sur know that if they miss one wave, another oneis sure to come along.

Therules for investment, however, are usually trickier: you either stay ahead ofthe wave, watch it go by, or get crushed by it.

Butdue to a curious confluence of factors, the real estate market in San Juan del Suris starting to resemble its surfing conditions.

Thosewho missed the first wave five to six years ago now have a unique chance to catcha ride on a second swell.

Sincethe global economic downturn first reared its ugly head, real estate prices in SanJuan del Sur have fallen by as much as 40 percent, according to real estatebrokers.

Projectsthat were selling homes for $100,000 a couple of years ago have now droppedtheir prices to $65,000, while an $145,000 home is now going for $87,000,according to listings at the Century 21 real estate office.

Onebay view condo that was asking $235,000 just sold for $100,000, according to thebrokerage firm.

Landprices are even cheaper, prompting some buyers to get off the fence and make theirmove. For example, one buyer just offered $180,000 for 35-hectare lot that was listedat $400,000, according to Gaspar Guadamuz, assistant general manager of Century21.

“Peoplehave to pay debts in the United States so they have to liquidate theirproperties in Nicaragua,” said Guadamuz. “It’s a buyers’ market.”

Theresult is that those who missed the really sweet real-estate deals five yearsago are getting a rare second chance. And this time, that second chance comeswith the added advantage of already having witnessed the potential for pricesto skyrocket once the market fully recovers.

“Ifyou missed the first opportunity here, now is the time to try again,” saidChris Berry, owner of the internationally famous Piedras y Olas, Pelican EyesResort.

Apioneer of San Juan del Sur’s tourism development, Berry not only rode thefirst wave, he was the first wave.

Todayhe says the situation in San Juan is much different than it was 10 years ago, whenthe government was viewed positively and the risk was whether this oceanfront stripof jungle would ever live up to its tourism potential. Now the government isthe risk, but tourism development and infrastructure are already in place.

“Thevision has been taken care of,” Berry said. “Now there is investment and touristsand the town has made a name for itself.”

Thereis also a lot more information available to buyers than there was when San Juanstarted to grow seven years ago.

“Buyingreal estate here before was more risky, because it was a new. But now there arepeople who have a lot more experience and clients are much more educated,” saidCentury 21’s Guadamuz.

ZachLunin, of Aurora Beachfront Realty, said the shifting market trend is alsoattracting a different type of buyer. He says fewer finance options in theUnited States have thinned the number of real estate speculators and short-terminvestors.

Luninsays his recent clients are people who have been interested in Nicaragua for years,but didn’t buy before because they thought the market was overpriced.

“Theseare people who were looking to buy two years ago but thought the price was toohigh and didn’t jump on it, but are going to do it now,” Lunin said.

Theclients, on a whole, tend to be middle class, adventurous, liberal-minded and perhapsnearing retirement age, Lunin said. It’s people looking for a home they canrent out now, and move into later.

“Thisis an end-buyer market,” he said. Others, however, insist that the falling priceshave also lured some new speculators, who are gambling that the prices have hitbottom and will start to rebound.

Regardlessof people’s motives, brokers are optimistic that the market is starting to turnthe corner on the way to recovery.

“Peoplehave already seen the potential of this town,” Guadamuz says. “San Juan del Surwill grow fast or slow, but it won’t stop growing.”

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