Investment Property in DR

Hello!

Hi, I'm new to this forum and excited to be here!  Lots of helpful tips as I've been reading through threads so hoping I can gain some insight on investment opportunities in DR.

I've visited DR and stayed in Santo Domingo/Juan Dolio last year to get a feel of the island, climate and culture.  Needless to say, I felt at home and hope to one day become a permanent resident however my current situation simply will not allow for that right now. 

There does seem to be a continuous upswing in construction.  In fact, I have opportunity to reserve a condo in pre-constructed building in Juan Dolio.  While I was assured the developers are well know and well respected, and has been in the development business for over 20 years, I'm still unsure (and quite frankly skeptical) if this is the right approach to take.  During last year's visit, I have seen other fully constructed residential buildings by said developers, including another property on Juan Dolio beach (just a few doors down from the construction site).

Alternatively, seems like another potential area to think about buying investment property is Punta Cana and maybe even North Shore.  My questions are:

1.  Does it make sense to buy investment property in Juan Dolio or Punta Cana?  Should I think about other areas outside of the two I've mentioned?
2.  What should I watch out for in terms of pre-constructed sites/contracts?  Has anyone bought into pre-constructed property?  Any advice?
3. Should I even consider investing in DR property altogether? 

Appreciate your thoughts, opinions, and advice in advance!

Welcome to the forums.  Investment properties are complicated here.

Whether its right or not depends on what you are trying to do,  your risk tolerance, how thoroughly you research the location, developers etc.   It s not easy and it is risky!   

Do your homework thoroughly on ANY possible purchase. Make sure you have an independent lawyer! 

Others will have more info than I do.  Sort thru it all!

Hi Jackie,

Do you plan on living in the property part of the year or rent it out all year long?

If renting, are you planning to rent it short-term (i.e. AirBnb, Booking, etc.) or long-term (i.e. 6-12 month lease)?

Will the developer manage the property on your behalf?

What are the costs associated with the property (i.e. property management, HOA, etc.)

The answers to these questions will help determine the feasibility of the investment.

Hi Jackie, We bought a condo pre-construction in Punta Cana in 2014 and it was complete on 1 year as promised. I would make sure you are with a reputable realtor representing the project and it would help if the developer has built othet projects in the area (as our developer did) the realtor can show you.

Our realtor hooked us up with the lawyer that they use and he was fine but with me not speaking Spanish I wish I had went with different lawyer...he spoke English but his accent was so heavy I could not understand, but we emailed back and forth which was fine and my realtor helped when needed.

You will probably pay in construction draws...just make sure there is actual work being completed according to the draw schedule if you don't live near the project (via realtor sending pics, the projects website, you tube etc).  Plus go with your gut! We actually met the developer at the project when the place was going up and we felt good about it. Also if you don't speak Spanish always translate the entire contact online in BING Translator (or other) so you can read and understand that every thing you agreed on getting included (granite, tile or any upgrades) with the realtor is actually in the contract.

We had a good experience.. Just research and ask a lot of questions....#1 for me would be "is this their first project in the DR??" You want to be guaranteed a title in your name when you close.  Good luck😊

Just, echoing others..."the right place" depends on what your goals are and your budget. Punta Cana, I can imagine will have great rental potential...but, short term rentals mostly. Northcoast has lots of great towns, some more touristy than others...more toursity = more rental income. We are planning to build two houses in Cabrera where our current house is so that we will be able to manage them ourselves eventually in retirement and live off the income. We are lucky...there seems to be a lack of two bedroom with pool rental homes in our town, so we'll capitalize on that...and there's room for others...but, you won't have the Air BnB sytle rentals here...longer term seems to be the market.

I have used Guzman Ariza in las terrenas and Santo Domingo for home purchase & visa. They are excellent and speak fluent English.  Gary 🇨🇦

With regards to short term rentals through Airbnb etc...how does one protect their assets in the event of a lawsuit...is it recommended to register as a company through an SRL? Are there other ways to protect your assets without an SRL. What are the Pro and Cons of SRL.  My wife and I plan on more than one property investment in Dominican Republic.

You will want to  use an SRL for this yes. But also for protection and ease in case of death of one of the partners.   

Pros -protection of assets and against liability.  Ease of estate passing.

Cons -  fee to set up and annual cost to report.  Set up about US 1,000 and up.  Annual  US 250 or US 300 to report.

ANd if you already own the real estate you will need to pay  to pass it into the company. Not sure how much.  In future the corp buys the real estate

You could also buy insurance on the property that includes protection against lawsuits.

As I understand it, you pay transfer tax just like when you buy personally...and I've been told and have experienced the government is getting really strict on the valuation side of things...

Yes. The /!\ I AM A STUPID SPAMMER /!\ transfer tax needs to be paid within six months of buying the property or additional monthly interest will be charged on the amount due.

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