Introduction
As 2024 comes to an end, Costa Rica Investments have monitored what we consider the most important indicators into the real estate investment market, and trends discovered throughout the year. This year saw growth in every sector we tracked compared to the years before, there was growth in vacation rentals, travel has seen increased arrivals, with increased activity in the Multi-Listing-Service (MLS) real estate market. This blog explores the key trends shaping these sectors.
The vacation rental sector showed strong growth throughout 2024. Total listings increased steadily, with the largest jump in listings coming in March. March saw a 4.61% increase in Listings from February, and a 23.53% increase from March 2023. In October, listings rose to 36,422, an increase of 4,462 listings (13.96%) from January of this year.
With expected fluctuations due to seasonality, the Average Daily Rate (ADR) peaked during seasonal highs, January through April, where the ADR sat in between $276.38 and $282.61 a night for a private residence. These top ADRs are lower than the same period in 2023, but interestingly, the less popular seasons (May through October) all saw higher ADRs than the same months in 2023.
Occupancy, as expected, saw seasonal variations, with peak occupancy in early months (January, February and March) while lower rates in September reflected typical off-season trends. The most interesting difference in Occupancy was in April. There was a difference of almost 10% between 2023 and 2024, with 2024 being much lower. This is a much larger difference than any other month. This difference between March and April (-21%) was the largest difference between months in 2024, positive or negative.
Arrivals: A Steady Rebound
Arrivals have been a strong indicator of the vacation rental market, with tourism trends being strongly correlated to Performance of vacation rentals. This year so far has seen 10.34% more arrivals than in the same time period of 2023. March was the biggest month for arrivals into Costa Rica of all time seeing 322,400 people arrive into Costa Rica by air. Every month except for September and October were increased over 2023.
Another interesting statistic to indicate where demand is in Costa Rica is to look at the percentage share each airport has of Costa Rican tourists. In 2024, the Guanacaste Airport in Liberia claimed an average of 31.74% of all tourists arriving in Costa Rica. This is a notable increase from 23.66% in 2019, the last comparable “normal year” for Costa Rican tourism.
Real estate activity, especially in the Multi Listing Service (MLS), grew a lot in 2024. This is not the best indicator for real estate investment market health in Costa Rica as many deals happen off the MLS, and happen directly between owner and buyer over platforms like facebook and Encuentra24. Despite this, more and more properties have been listed to the MLS over the last few years, with 2024 being the biggest year for the number of listings on the service.
From the beginning of 2024, there have been 242 sold residential properties on the MLS, and 94 plots of land, ranging from farms to small subdivided lots. That is 163 more residential properties and 78 more lots of land sold than in 2023. Although this looks like a large increases in sales year over year, this may be more related to a greater adoption of the MLS system in Costa Rica. Most of the deals that happen in the country are sourced from informal real estate websites such as Facebook marketplace and Facebook posts.
Conclusion
Costa Rica's real estate and real estate investment sectors grew in 2024, with significant gains in vacation rentals, tourism arrivals, and real estate. The vacation rental market saw a steady rise in listings and ADR trends that shifted from previous years, while tourism arrivals reached record highs and highlighted Costa Rica's growing appeal. Guanacaste Airport's increasing share of arrivals further emphasized this shift.
Real estate also thrived, with more listings on the MLS and a move towards more market transparency. Together, these trends demonstrate Costa Rica's resilience to global changes in politics and economics. By staying informed and proactive, investors can capitalize on the country's opportunities in the years ahead.
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