Here at RE/MAX Pura Vida we get approached by locals and foreigners looking to start a new life & business here in Costa Rica, often interested in investing in existing hotels, hostels, bed & breakfast or income producing vacation rentals. Of course there are benefits and drawbacks of buying an already built property versus purchasing raw land and handling the build yourself, which we try to discuss with all our clients.
Below we outline and discuss the top 3 benefits (in no particular order) of purchasing an already existing income-producing property in Santa Teresa, as well as highlight some of our profitable, turnkey listings for sale in the area.
Construction Permitting & Time
Just like any construction there are steps one must follow and ensure are in place in order to build in Costa Rica. These steps can not only be lengthy and time-consuming but also quite frustrating for those who do not speak the language or are familiar with the process. Although in theory building your dream hotel, or home, is ideal, this also translates into no income during those months of permitting and/or construction.
All the architects, builders, contractors etc that we work with at RE/MAX Pura Vida can be helpful and useful during these times, however if you are looking to start a business within a certain time period to ensure income, we recommend looking into existing hotels.
For example, these wonderfully charming hotels are a perfect turnkey opportunity for those looking to own a hotel, along with the option of living on-site and room to expand and build more rooms if you should choose, without losing income or guests during construction time.
Location, Location, Location
People have said this for years and it still holds true, location, especially for hotels and income properties, is key. Despite being a small town of approximately 10 km long, there are certainly areas considered more desirable than others. These factors can be water availability, concession grants, road conditions and/or surf breaks to name a few. Since our town is fairly small, there are only so many desirable plots large enough left for sale to build a hotel.
There are certain restrictions when dealing with beachfront properties however these are some of the most sought after properties in the area given our famed, pristine beaches of Santa Teresa, Mal Pais and Playa Hermosa. On the other hand some of the mountain top properties boast amazing views and less building restrictions however require typically 4×4 transportation for guests and clients.
Two of our beautifully listed beachfront hotels & restaurants, for example below, are great ideas of owning a centrally located hotel and public restaurant, allowing guests to easily navigate through town and provides extra income from outside guests.
Reputation & Occupancy
If anything when it comes to the hotel business is more important these days than location it is their reputation, which in turns translates into higher occupancy rates. Given the rise of social media, online booking companies and travel bloggers, it is important, if not necessary, to have a solid online presence and positive reviews and/or feedback from clients. Many places work with established, reputable companies and/or bloggers to bump their status up which will definitely help occupancy rates.
In addition to working with others, many businesses pay for online advertising, campaigns etc, so it is important to know the difference between paid and organic reach, just because a business has thousands of followers, do these followers give a “return on investment” for the business? Make sure to check all the reviews of any business prior to purchasing.
These wonderful oceanfront villas and yoga retreat center in Playa Hermosa boast an 85% year-round occupancy rate. They not only have an extremely respected hotel brand, but they have a solid following of returning clientele. This is of course due to the hotel owners & staff creating an unforgettable space & experience for their guests throughout the years, that you cannot build from scratch overnight.
If you have any questions or concerns about buying property in Costa Rica please don’t hesitate to contact us today! At RE/MAX Pura Vida we are dedicated to helping our clients find the ideal property and ensuring all parties are satisfied.