ISSUE #737: Nov. 25 - Dec. 1, 2018


Brian Timmons, Newsletter Author
Brian Timmons

Dear friends,

When I started Residencias Los Jardines, I started writing a weekly newsletter -determined to tell all the good, bad, and the ugly. I knew some readers would be interested in the construction process. I expected others might be interested in the lifestyle of two people who had decided to live outside the box. For others, the adventures of Lita, the parrot and the cat took on an entertainment saga all its own.

Residencias Los Jardines is finished. We periodically have re-sales and rental availability. Some readers may be interested in this information.

Brian Timmons
Developer / Property manager
Residencias Los Jardines

Web: https://www.residenciaslosjardines.com
Emails: info@residenciaslosjardines.com

rentals & sales

Paradisus Condos / Rohrmoser
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Paradisus Condos - click to visit

Each of the units consists of two bedrooms / two bathrooms, and a large living/dining/kitchen area. The floor plan of each of these units has eliminated the optional "den / office" divider. The result is a larger area offering more flexible furniture arrangements while still maintaining the option of including an office area. At 105m2 plus two parking spots each and storage locker, they offer a great opportunity for someone seeking views, security, central location, and first class, all round living...

Semi furnished unit: For sale: $235,000
Fully furnished unit: For sale: $245,000
Floor 12 -west view

Real de Santa María / Borreal de Heredia
$ 185,000 $175,000 (reduced)
Private financing available

See location on Google Maps

Real de Santa María / Borreal de Heredia

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Market activity
sales & rentals

Sales: Los Jardines: Units #114 and #124


Paradisus: Nothing available

Los Jardines: Units #106C and #112

Residencias Los Jardines
property management, rentals & re-sales

Unit #114: $ 199,000 / See Unit
Unit #124: $135,000 $ 125,000 / See Unit

Unit #106C: $ 950 mo. / Available immediately / See Unit
Unit #112: $ 1,250 mo. / Available December 4 / See Unit

For sale

UNIT #114
$ 199,000

Total Area (Sq Ft): 1290
Total area (Sq M): 120
Bedrooms: 2
Bathrooms: 2
Floor(s): 1
Type: Semi-Attached
Furnished: Yes

This 2 bedroom/2bathroom,1,290 sf single floor end unit home includes a 150 sf front terrace plus parking for one car. This house is fully air conditioned and has recently been professionally decorated by international decorator Alcides Graffe and has undergone a complete renovation—new modern furniture, finishings, window coverings, and art work by Carlos Gambino. It is arguably the nicest furnished unit at Residencias Los Jardines and only steps from the pool

UNIT #124
$135,000 $ 125,000

Total Area (Sq Ft): 662
Total area (Sq M): 61
Bedrooms: 1
Bathrooms: 1
Floor(s): 2nd Floor
Type: Semi-Detached
Furnished: Yes

This 662 sf, + covered parking for one car, is a one bedroom home on the 2nd floor overlooking the large pool. It is ideal for a single person or couple.

For rent

UNIT #106C
$ 950 mo.
Available immediately

Total Area (Sq Ft): 1250
Total area (Sq M): 120
Bedrooms: 2
Bathrooms: 2
Floor(s): 1
Type: 4-plex
Furnished: Yes

This is a fully furnished 2-bedroom unit situated in a 2-story building, which has two units on the ground floor and two units on the 2nd. floor. Each unit is the same size (1,250sf) divided into 800 sf of interior space and 450 sf of covered front and back terraces. Units 106A and B are on the ground floor; Units 106 C and D are on the 2nd. Floor. The solid masonry demising wall (common wall) as well as the 5” concrete slab prevent sound transference.

UNIT #112
$ 1,250 mo.
Available December 4

Total Area (Sq Ft): 1290
Total area (Sq M): 120
Bedrooms: 2
Bathrooms: 2
Floor(s): 1
Type: 1 Story
Furnished: Yes

This 1,290 sf single floor home includes a 300 sf front terrace plus parking for one car. It is attached on two sides by a 6 inch cement demising (common) wall, which prevents sound transfer.

Our Lives

Weather: There is less and less rain. We are readying our sprinklers / hoses / and misc. dry weather mode. We expect to hire a young person Dec. 1 dedicated to watering / raking / sweeping.

What Happened This Week:

Note: Last week's newsletter was delivered late because the rough draft was not received by Maria in Argentina and even though she requested I resend it, I dropped the ball. I am only able to kept 4 or so balls in the air, not the 6+ I use to be able to... think it might be referred to as "age related cognitive degeneration".


(a) Heredia House: Closing did not happen and who knows... The bank cannot do international wire transfers. The bank wants to deposit the funds to a CR account in Lita's name... she does not have an account. Yes, she could open an account -with time, hassle, and I do not trust any bank to release the funds in a timely fashion in a newly created account... there will likely be some reason, unwritten rule, some missing document, some ??? which the bank will use to make life difficult... the lawyer I have / am using never removed Lita's registered mortgage so the bank won't release funds in any event until that is removed... that will take up to 10 working days to show up in the national registry and Lita has now said she doesn't like the price... I disagree so we have a battle on our hands... this sale is not going smoothly...

(b) Distritcuatro: Yes it closed but that too saw a last minute hiccup... the purchaser's bank had a lower limit than was needed to complete the deal... mmmm o.k. we go to a cashier's check... well, the bank manager needed to sign for the necessary amount... he wasn't there... the assistant manager was sick so he wasn't at the bank either... so payment was made by two checks which could be issued without manager / assistant manager authorization...

Gardening: We continued to make progress on garden lightening, cleaning / repairing, re-organizing areas... We are a long way towards the end goal but not there yet... however, we will be slowing down on all this work.

Sales -Los Jardines: It appears that one of our units is in the process of being sold. Some issues exist but they are expected to be resolved. And another unit may be sold as well.

Fiscal Situation: The colon has continued to gain strength (lots of US dollars entering the system due to aginaldo, bonuses, etc.) with the exchange range being around 596:1.

A New Dawning -nope... false dawn: It continues to be elusive with the doubtful sale of Heredia. I will still have to deal with it, am waiting on the INS issue to be resolved as well, and in both cases, I foresee a lot of issues...

News Items of the Week


(1) The teachers strike has again been declared "illegal"... This is the second time... illegal, then overturned and declared legal, and now declared illegal again. It is really difficult for the government to get it's act together... too many selfish hands out... including the judiciary... The government said that 75% of the principals would be replaced because they did not return to work (this will never happen)... There seems to be about 83,000 teachers... a small majority continue to vote to continue the strike... one union has voted to return for 9 days before the official end of the school year... this is pure BS.. students won't return and nothing will be done.. meanwhile all the teachers continue to received full salaries and perhaps additional activity pay (I do not know about the latter only suspect that in a socialist state this will be the case.)

2. 70 years with no army: This is a remarkable achievement but looking closer at the reasons for abolishing the army are a bit self serving... not completely altruistic... as I understand there had just been a very short coup perpetrated by the military so when the Figueres won control, he abolished the army because he knew he couldn't count on it's loyalty and besides, they could never be disciplined to show up on time or at the same place... He sold the idea of abolition on the good things that could be done with the saved funds... and that did work until the government hands got to be too greedy. Just like CR declared war on Germany before the US did, it was for selfish reasons... government officials / wealthy wanted German citizen property.

3. Fiscal Reform--2nd reading... Yes this is going ahead and will probably be passed but not before hiccups... I am sure... and as FITCH has pointed out, it won't solve the problem and it won't come in to effect for at least 6 mo. and won't begin to benefit the treasury until after that...

4: Consumer Confidence: This is not great news but is not really news. Anyone living here knows this. Decisions are being put off pending the uncertainty in the fiscal reforms and the ability of the government to chart a clear path towards sobriety.

5. Exchange rate expectations: The last sentence says it all: It is expected that volatility in the exchange rate will continue in the coming weeks, with a pause in December, as a consequence of a seasonal effect of the “colonization” of resources for the payment of taxes and bonuses, but with an upward trend.

1. Education Sector Labor Unions in Costa Rica Divided on Whether to Maintain Strike

The Constitutional Chamber gave green light for Congress to vote on the fiscal reform, the Labor Court ruled for a second time the strike of educators as illegal, but the biggest labor union of the education sector, the National Association of Educators (ANDE) decided to maintain the strike while members of the Costa Rican Educators Labor Union (SEC) chose to go back to work, and APSE the third labor union, has not come to a decision yet.

ANDE informed us that it’s members voted and 58.58% voted against lifting the strike the so therefore they will maintain the movement. ANDE has close to 50 thousand members.

SEC, on the other hand, has close to 30 thousand members, and informed that they will be lifting the movement and signing the agreement with the Government, going back to class next week for the remaining 9 days of the school year and then will go on vacation. Some of the members of SEC expressed their rejection to this decision.

The agreement with the government establishes that there will be no retaliation against the educators that joined the strike; however, disciplinary measures regarding salary deductions or against strikers that traveled out of the country will be a decision of the courts.

2. Costa Rica Celebrates 70 Years With No Army

Costa Rica celebrates 70 years with no army this December 1st, and to commemorate this important date, the Government has organized several cultural activities, as well as audiovisual campaigns throughout this week.

The Presidential House, the National Insurance Institute, the Supreme Electoral Court, the Ministry of Foreign Affairs and the Social Security Service will showcase the colors of the Costa Rican flag in their facades, “this is a reminder that this important date is an essential part of our country’s identity”, explains the press release.

An audiovisual campaign will be spread in social media with testimonies by Costa Ricans, foreigners and authority figures who will speak of the importance of this date, and what the country would be like if this decision wouldn’t have been taken 70 years ago.

It was back in December 1, 1948 when Jose Figueres Ferrer, the president of the “Founding Governing Board of the Second Republic” made the announcement in front of a group of leaders gathered in the Bellavista Quarters; however, it was the Defense Minister Edgar Cardona who proposed the idea to spend more in education and health, according to former Interior minister Alvaro Ramos.

The day the abolition of the Army was announced, the keys to the military barracks were handed over to the newly founded University of Costa Rica so they could establish the National Museum as a center for anthropological studies.

On October 31, 1949, the National Constituent Assembly incorporated the abolition of the army into Article 12 of the Political Constitution.

3. Constitutional Chamber in Costa Rica Gives Green Light for Congress to Vote Fiscal Reform in 2nd Debate

The Constitutional Chamber in Costa Rica (Sala IV) gave, the evening of this Friday, November 23, its resolution regarding the fiscal reform project; the judges concluded, unanimously, that they did not find vices in the procedure or form of the project giving green light to Congress to vote it in second debate.

The resolution of the Constitutional Chamber provides the green light for the project to be voted in second debate and confirms that it does not require a minimum of 38 votes to be approved, instead it will only require the qualified majority of 29 votes for its approval.

The fiscal plan was approved in first debate by congress back in October 5 with 35 votes in favor; the project then was sent to the Constitutional Chamber for consultation.

Costa Rica’s Judiciary Branch voted in October 16 opposing the fiscal reform, arguing that it contains expense containment measures that affect the Judiciary Branch; according to Art.167 of the Constitution if the Judicial Branch considers that a project being discussed in Congress affects its organization and operation, the Legislative Assembly will then require 38 votes for its approval.

However, the judges of the Constitutional Chamber considered that the project will not affect the Judiciary Branch and therefore congress can proceed with its vote in second debate.

“We call on the members of congress, so this plan can be voted on second debate promptly. Costa Rica requires this project to begin a stage of hope, of economic and social stability and growth”, commented President Carlos Alvarado.

Congress could vote the project in the next couple of weeks prior to entering in recess December 20.

The discussion of this fiscal plan is being protested by labor unions in an ongoing strike that began September 10 and has already generated billions in losses.

4. UCR: Consumer confidence fell to its lowest level in 16 years

Uncertainty about the approval of the fiscal reform and the general strike called by the unions are two of the main elements that led consumer confidence to its lowest level, according to the Statistical School of the University of Costa Rica.

In November 2018, the consumer confidence index reached 28.2 on a scale of 100, this is the lowest level since the indicator survey began in September 2002. The result of November came to deepen the negative results, which had already manifested from the previous quarter.

The survey was conducted between November 1st and 22nd, that is, it ended before the green light given unanimously by the constitutional magistrates to the bill for the Strengthening of Public Finances (file 20.580).

The figure of the indicator is lower than the 31.6 of the Solís Administration, when there was an increase in crime and the closing of companies was announced as well as the possibility of a new crisis.

It is also lower than the 33.1 of the Pacheco Administration, when an increase in inflation and oil prices caused fear among consumers, along with the protests over the Free Trade Agreement between Central America and the United States (CAFTA). Currently, the expectation of consumers that taxes will rise in the near future, as well as increases in fuel prices, interest rates and the exchange rate, weighs negatively.

There is a negative assessment of the best time to buy a home and vehicle: 77% and 84% are the magnitudes, respectively. People believe it is a bad time to invest in one of these goods.

Half of the population thought that the government is doing a poor job in terms of economic policy.

5. What to expect from the exchange rate in the coming weeks?

The position of the Constitutional Chamber regarding the bill to Strengthen Public Finances (file 20.580) gave the economy a respite, since it reduced the uncertainty in families and companies.

However, pressures on the foreign exchange market and interest rates will continue in the coming months due to the high financing required by the Ministry of Finance to be able to meet its obligations.

This was the conclusion of the Economic and Social Observatory of the National University, an entity that analyzed recent movements in the exchange rate.

According to the researchers of the Observatory, pressures on the foreign exchange market will continue in the coming months, as the tax reform will take effect until the second semester of 2019 (at least regarding the first tax revenues received), and most taxes would begin to be collected in 2020. This would make the fiscal deficit and public debt continue to grow.

Likewise, in case they get the approval to issue external debt (which requires 38 votes in the Legislative Assembly) it would take five to seven months to materialize (after the law is approved and published), so the deficit would continue to be financed in the domestic market and, therefore, the upward pressures on interest rates and the exchange rate would continue.

However, if foreign currency comes in due to the issuance of external debt, there are two possible scenarios:

a) the Ministry of Finance changes dollars to colones to pay the needs in local currency, pressing the exchange rate downwards or,

b) the Central Bank buys those dollars to recover the reserves lost throughout this year and the exchange rate will not be altered.

In addition, the Observatory believes that it is very likely that the Federal Reserve of the United States (FED) will continue with the gradual process of raising its reference rate, which could translate into additional pressure on the behavior of the exchange rate, in case the adjustments in domestic interest rates are not made in a timely manner.

Thus, the approval of the file 20.580 gives a break to the economy, but there is still much to achieve stability in the State’s finances.

It is expected that volatility in the exchange rate will continue in the coming weeks, with a pause in December, as a consequence of a seasonal effect of the “colonization” of resources for the payment of taxes and bonuses, but with an upward trend.


Brian C. Timmons
Property Manager RLJ and Newsletter Author

Costa Rica:
Cell: (+506) 8-455-59-35
Land line: (+506) 2282-4142 Ext. 101

VOIP: (+416) 461-2203

Web: https://www.residenciaslosjardines.com
Emails: info@residenciaslosjardines.com

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