Investing in Property

Hello northvanman,

What is the purchase price going to be? Will you conduct an inspection, especially for mold behind the drywall? Who will manage the rental of the property? Is there a monthly management fee and who is the "strata council", if there is one?

I sell real estate in Casa de Campo and La Romana on the south coast. I am a licensed realtor from Vancouver Island and return there every summer. If your purchase price is low, and you are comfortable with a high vacancy rate during the low season, and the building is newer, there may be an upside to buying. Remember that it is a strong buyers market in the D.R. so you are in the drivers seat.

How long have you been down here?

Steve

I missed the part about you buying the building, not the apartment. It may not be the money maker you think it could be and you will be married to it. Significant potential risk!

The easy answer is maybe.

It depends on so many things that no one can say either way!

The variables involved in this are huge.  And no one can predict what may happen in the future. 

Come down start looking around, comparing!  Get professional help on this. You need to find a good Realtor or maybe more than one. You need a really good Lawyer here to do the due diligence.  You need someone on your side, not acting for the seller!

I'll chime in, but just to illustrate the point.

We visited July-Aug 2018, about 12 days.  As experienced, long-term
(small) landlords in the states, we naturally checked out the RE investment market while here, one or two apartments. That trip, we were only in Santo Domingo.

We engaged a local real estate agent -- who we thought very highly of.  We viewed a lot of apartments in the Piantini area and thereabouts.  We saw a LOT of brand new apartments, just completed, under construction and selling, and planned but selling preconstruction.

Then, we engaged a cab driver and just toured around Piantini and surrounding neighborhoods.   Went to Church in Piantini, visited with locals.  We also checked airb&b availability, pricing and rent trends.   

Impressions:  Way, way too many units under construction in the new "downtown area.  Many of the airb&b landlords seemed, well, desparate to rent, and eagerly offered discounts to get someone locked in.  Too eagerly. 

Conclusion;   If there is not a glut "now" there will be within 2-3 years.  Signs of a glut are showing up in Piantini now, in airb&b pricing.

I have no doubt the long-term prospects for Santo Domingo are excellent.  We're still pursuing ourRetirista Residencies, and will start wintering in the DR in Dec 2019, if all goes well.  We'll be happy to rent, but feel no rush to buy a home or condo.

However, we've backed off on investing in RE, as a pull-back seems likely.  Heck, it appears there is a RE pullback in the US.  Not yet a recession -- but enough clouds on the horizon for caution to reign.  That doesn't add optimism for DR.

Planner and Steverino have far more experience in DR than us.  If they say to be careful in RE, it's time to be careful.   

That we came to the same conclusions in July/August, based on less than two weeks investigation, strongly validates Planner's and Steverino's advice.

Now, if you're a RE whale and are buying entire budings... maybe you have the weight to pull in some major discounts now.  If so, my best respects.  I'm just not in that class of investing.

I'd like to emphasize one more time -- our real estate agent was/is smart, honest and helpful.  We will continue working with him.  But, the numbers must change (lower prices or higher rents) before we invest in SD/DR real estate.

Jim
ExpatRusher

Thank you so much for the feed and all the information I am for sure not going to take any risk.

I will be careful with every step I am taking, and I may ask for your service for sure because I need a professional to advise me, even if I come and visit multiple times I think I won't be able to get the right information on my own.

Interesting observations regarding Santo Domingo market. 

It is very very different then other areas

For example -  Santo Domingo east can't keep up with demand. 

The north coast will be very different then SD as it will be to Punta Cana area..

My point is do the research, dig deep.  Understand the area and what is going on. Do not believe any one person or group of people.  Remember the motivation of the people you are speaking with.

I suspect the money is being made by the developers in the central part of Santo Domingo and the individual buyers are the ones having a tough time because many of them have bought in as investment properties to rent out.

There seem to be no planning laws and new apartment blocks are being squeezed in next to each other throughout the centre of the city and the population densities are now such that traffic has become horrendous in such places as Piantini. It is urban planning madness imo or rather lack of it.

In Bella Vista the same is happening and they are even knocking down older lower rise rise apartment blocks for taller buildings. I would shy away from any purchase in the city right now and rent if you need a place, and spend time looking at an investment property in a developing tourist area

On a positive note the Santo Domingo City Hall is working on the 2030 city planning. They have consulted with international leaders on the subject and will begin implementation based on their finding soon.

To begin improving congestion in the center part of the city new parking lots and parking structures are underway. And large business are being required to have sufficient parking spaces for their employees and customers which are constructing their own multi-level parking structure adjacent to their newly constructed property.

Examples:
Humano on John F Kennedy’s Blvd
Popular on 27 of February Ave
BHD Leon on 27 of February Ave

Great info.   It will be interesting to follow the progress of this city.  It was built and developed with no real plan. Their plan for transportation was outgrown before it was announced! 

Parking,  traffic flow,  congestion are huge issues here in the capital. Much less so in other areas of the country. 

Lennox their are laws honey,  just not enforced!  Como siempre.  Bribes are common.  Breaking of bylaws common. Breaking of building codes common.  Breaking of employee safety laws common.