Why Costa Rica Real Estate?
Stable government
Currency
The colón, plural colones, is the currency of Costa Rica. The Costa Rican Colon was named after explorer Christopher Columbus, known as Cristóbal Colón in Spanish. It replaced the peso as the official currency in 1896. Bills come in denominations of 1,000 2,000 5,000 and 10,000. Business in Costa Rica can done in U.S. dollars as it is the second currency of Costa Rica, but the colones are the primary monetary unit utilized day to day in Costa Rica.
Banco Central De Costa Rica has been the sole issuer of currency since 1950. Costa Rica has four major private banks that are internationally hedged and leveraged much like the banks of Europe, Asia and the U.S. For stability, Costa Rica has had the colon pegged to the dollar with small depreciation occurring each month. Costa Rica, in economic terms, was a crawling peg regime.
On October 16, 2006, this crawling peg was modified due to weakness in the U.S. dollar and the recognition that the colón was notably undervalued. Real estate speculators and investors are encouraged by this step. It enables investments to reflect, more clearly, the true intrinsic value that Costa Rica's economic conditions provide. Costa Rica hosts the fourth largest foreign investment in the world due the low ownership restrictions and strong property rights afforded to foreigners. Currency is rewarded for these factors.
With one of the largest coffee and fruit exports, the intrinsic value of its unique land, and revenues over 1 billion dollars per year in tourism, Costa Rica's economy has acquired a level of stability that gives its currency a lasting foundation for facilitating security and investment.
The exchange rate today is free to float within world market forces on a currency band referenced to the United States dollar. The floor of the band has been set at a fixed value, while the ceiling changes at a fixed rate. In practice the exchange rate has remained fixed at the lower value of the currency band.