The greatest force in the universe is the power of compound interest--Einstein

Call it ‘Blowback.'

I recently read a piece on US foreign policy where an analyst used the term to describe what's happening in the Middle East. He boiled it down to the nitty gritty.

After more than a half-century of treating a whole bunch of people like dirt, installing and removing governments, supporting dictators disguised as kings sheikhs and shahs and creating janissary armies wherever a bit of pressure was needed, the US finds itself with few friends and lots of costly consequences.

The ‘non-negotiable' American way of life is getting another big reality check in the mail these days. Apparently, as it turns out, neither governments nor individuals can simply keep borrowing forever. The overextended credit chickens are coming home to roost. Financial blowback is sweeping through the US mortgage based economy, the Federal Reserve is throwing billions into a black hole that some say is a nice round quadrillion dollars, and the gravitational pulse from the implosion of the starred and striped economy is having ripple effects-if not a ‘tsunami'-worldwide.

The realty market on the Gold Coast seems to be feeling the effects. Property sales are soft, remarks one developer. No duh, quips another long time resident, explaining that the modus operandi for half of purchases in the good old days was to go home from a trip to Costa Rica and simply refinance. As you drive along these days, it's easy to spot the telltale signs of projects that have hit the soft spot in their spreadsheets that signifies the shifting sands of financial instability.

Potential buyers are encouraged to look beyond the fancy websites, slick brochures and the smiling salesmen with the Pura Vida promo talk. You might not want to build your dream home at the dead end of a rutted road in a future ghost town. Here are a few warning signs:

Stop: Don't go in, go around, just check the perimeter as much as possible. You can often tell more about the place by looking at what they don't want you to see. How are the fences? How do they deal with trash? If you can get downhill or downstream, you'll get an idea of what kind of impact the project is having on streams, roads and in some cases their neighbors. (It is worthy of note that legal precedents do exist for holding landowners responsible for flooding damage downstream from their project.)

Look: for signs of inactivity. Are workers scurrying around, are projects finished, or halfway done and no one bringing them to completion? Are piles of sand and gravel lying around, small jobs involving concrete that never got mixed? A great example is just down the road from where I live, a scaffold next to an unfinished guardhouse, covered in dust. You get an immediate impression of emptiness and desolation.

Listen: If you can, by all means contact other buyers. Are there really 20, 40 or 60 lots sold? If so get in touch with these folks, if indeed they exist. If they don't, why is the developer trying to convey a sense of momentum that may not exist. If he's not telling ‘the whole truth' on this point, what else is ‘pura prevarication?'

If you can speak Spanish, talking to the workers and subcontractors can really give an inside look at both the financial situation and the ethics of the developer. Have the sub's been paid? If not, what's cooking? A full dossier of the lying, cheating and stealing that have taken place in real estate around here over the last ten years would run into hundreds of pages. Smart buyers should turn over a few stones before committing. The last thing people want is for their tropical dream to become one big, long lasting migraine headache.

Bear with me a bit to beat the drum a bit on a favorite topic of mine-regular readers might call it whipping a dead horse-but I like to think of it as my honest effort to help buyers ensure a bit of, just for the heck of it, let's call it ‘homeland security.'

Pay special attention to the road system. Check the layout, steepness, maintenance, and any recent repairs after the winter floods. What is the distance you will have to drive to get from a main road all the way to your future dream home? Why all the fuss? Well, it turns out that most sales are made after showing properties in the ‘well behaved' weather of our dry season.

Try to imagine what those roads are like during or after the 13 feet of rain which fell from May to November of this year. One project in my valley simply ‘lost' about 100 feet of road going up the mountains to their cozy neighborhood in the hills.

A good friend is now the proud owner of an ocean view home that is virtually inaccessible in the rains. The developer needs more sales to fix the roads. Another mental exercise, try to imagine what the roads will be like with at least half the lots occupied. More vehicle trips leads to more rutting which leads to faster down cutting of the roadbed. Continued increases in fossil fuel prices only ensure that road maintenance will get more costly over time. At what point does the road repair bill become a giant financial millstone around the development's neck? At what point does the road to your own personal paradise become a road to nowhere?

In my own small project, having the experience of working on the roads in a number of developments makes it second nature to design a ‘minimum path' layout and build to avoid problems in the rains. Looking at how the numbers work out over the years, guaranteeing safe access to your properties sometimes cuts into the bottom line. But there's just no way around it. Selling land with dubious access is both unethical and bad business. If the finances don't pan out to provide clients with sound infrastructure, what's being peddled is a pura vida variation of a pyramid scheme.

In order to avoid ‘that sinking feeling', buyers may need to remind some developers that the yellow brick road is supposed to be a two way street-rain or shine.

Tom Peifer is an ecological land use consultant with 12 years experience in Guanacaste. Phone: 658-8018.  peifer@racsa.co.cr

El Centro Verde is dedicated to sustainable land use, agriculture and development

Web site: http://www.elcentroverde.org/