About the country
The Dominican Republic occupies two-thirds of the island of Haiti (Hispaniola), located near North and South America. The rest of it is occupied by the poorer State of Haiti.
From the north, the Dominican Republic is washed by the Atlantic Ocean, from the south by the Caribbean Sea. The country has a subtropical climate and summers all year round, however, thanks to pleasant sea breezes, there is no sweltering heat. In summer, the air warms up to an average of + 33 °C, in winter to +25 °C. The water temperature in the sea and ocean ranges from +24 to +29 depending on the time of year. From April to October, the largest amount of precipitation falls on the island, but even this does not spoil your stay in this paradise corner of the planet, since the showers here are short. It should be remembered, however, that in the period from August to October, hurricanes occur in the region.
The landscape of the small island is diverse. Several mountain ranges are interspersed with fertile green valleys, the main of which is Sibao. Agricultural land stretches for many kilometers: orchards, rice fields, sugar cane plantations, coffee, cocoa, tobacco.
Not far from the cane plantations in the valleys of La Vega Real and Cibao, as well as in the southern and southeastern regions, there are many sugar production plants. Dominicans also produce cigars, actively competing in this market with Cubans. A significant part of the products of the agricultural sector and the processing industry are export-oriented.Nickel and iron ore, silver, and gold are mined in the mountainous area. Amber is collected in the Puerto Plata area on the Atlantic coast.
Tourism occupies a special place in the economy of the country with such favorable natural prerequisites. This sector accounts for 15% of the state's GDP (except for the last 2 years).
The Dominican Republic is divided into 3 major regions, which, in turn, consist of subregions and provinces. There are 31 provinces and 1 national district in the country. The capital of the state: Santo Domingo.
The most important tourist region is the province of La Altagracia in the eastern part of the country, on the territory of which the popular resort of Punta Cana is located.
In addition to La Altagracia, other regions are also developing. Experts of the Dominican edition distinguish: the city of Miches, lost among untouched nature in the province of El Ceibo on the northeast coast, the resort of Puerto Plata on the north coast; the fabulously beautiful mountain peninsula of Samana, off the coast of which you can see the mating games of humpback whales; the cities of Constanza and Jarabacoa in the picturesque high-altitude valley of the province of La Vega in the central parts of the country.
Comfortable buses run between cities in the Dominican Republic, with air conditioning and a toilet. However, public transport is poorly developed inside settlements. Most often on the streets you can find small minibuses, which are popularly called "gua-gua". You can stop them by simply raising your hand. There are almost no bus stops familiar to us. So, in order to live in the country and move freely, it is better to have a car.
History of the Punta Cana resort
The history of tourism development in the Dominican Republic begins after the overthrow of the dictatorship of Rafael Leonidas Trujillo in 1962, who ruled the country for more than 35 years (since 1924). When the first democratically elected President, Joaquin Balaguer, came to power in 1966, the lands put up for sale were bought up by local and foreign investors. Since 1882, the active construction of hotels and tourist infrastructure has begun.
The Italians were the first to discover this market as an investment-attractive one. They were followed by Americans, Canadians, as well as investors from other countries.
Observant foreigners paid special attention to the uninhabited coast in the eastern part of paradise island. The fact is that this region is naturally protected from storms. If the storms come from the north, they hit the Puerto Plateau. If from the south, they break on the shores of Santo Domingo. Moreover, coral reefs stretching along this tip of the island protect from sharks. Thus, the territory of the province of La Altagracia is not only a picturesque, but a safe place.
Few people know that Punta Cana is not an administrative unit of the country, but the name of a major investment project. Founded in 1969 by Dominican Frank Reynieri and American Theodore Hill (in 1997, designer Oscar de la Renta and singer Julio Iglesias also became co-owners of the business), Grupo Punta Cana began its activities quite modestly, with the opening of a small hotel complex designed for 40 guests.
A few years later, the partners managed to attract foreign investors to the case. The business gradually expanded, but the key points for its development were the opening of the state highway, which allowed guests to easily get to hotels, and, most importantly, obtaining a permit for the construction of the world's first private international airport. The Punta Cana Airport, which started operating in 1984, annually receives about 65% of all tourists coming to the country. In addition to the air harbor, the investment group built schools, hospitals, transport facilities, and a tourist complex.
According to local residents, over the past 15-20 years, Punta Cana has turned from a village into a city. The resort consumes about 70% of all food produced in the country and brings significant revenues to the treasury.
State support for investors
The country's authorities are purposefully taking measures to ensure that foreign capital flocks to the Dominican Republic.
Firstly, the property registration system was regulated. In 2000, the land plots were measured and all owners were obliged to change the titles (ownership documents) to new ones with correct data.
Secondly, a soft tax policy is being pursued. Those who purchase "tourist" housing (or housing by state standards that falls under the article "tourist") are exempt from the one-time tax on the transfer of ownership (3%) and from the annual real estate tax (1%). Holidays in respect of the last tax last 10-15 years, depending on the project. This practice came to the Dominican Republic about 15 years ago from Colombia. According to our experts, the mentioned privilege when buying objects in new buildings will be provided for another 3 years (for those who received this privilege earlier, its effect will not cease for another 10-15 years). Note that this law applies only to the first sale, from the developer.
Thirdly, since 1998, the rights of foreigners in the acquisition of real estate have been equated with the rights of citizens of the Dominican Republic. To conclude a deal on the purchase of an apartment or a house, it is enough to have only a passport and any second identity document. Foreigners receive real estate in full possession with the right to transfer to heirs.
Fourth, the Dominican Republic is a visa-free country.Punta Cana Real Estate Market
Punta Cana and Cap Cana
There are 2 large residential areas in the resort of Punta Cana, each of which has ten kilometers of coastal strip: the eponymous Punta Cana district from the Grupo Punta Cana investment group and Cap Cana.
The Punta Cana area, in turn, is divided into several sectors. Adjacent to the sea is the elite residence Punta Cana Resort. Further from the coast are the houses of Punta Cana Village. This location conditionally refers to the business segment.
Punta Cana is convenient for a quiet family life.
All the necessary infrastructure is located on a private closed territory: schools, clinics, shops, restaurants, all kinds of offices. The nearest beach is only 8 minutes by car. It is quite realistic to live here, traveling outside only occasionally.
The territory is carefully guarded by a private specialized company. Children can safely ride bicycles or scooters inside the village. The level of security is also indicated by the fact that the house can easily be left unlocked.
The cost of apartments in Punta Cana Resort starts from $500,000, villas from $1 000 000. The minimum budget for buying an apartment in Punta Cana Village is $230,000, villas are $480, 000.
Next to Punta Cana, the Cap Cana district has been built, which is now rapidly being built up. Several world-renowned hotels have opened in Cap-Can, for example, Eden Rock and Century, where the stars like to stay.
The architectural appearance of Cap Cana is a bit like Dubai: wide roads, bridges, chic in the decoration of buildings. High-rise complexes are also appearing.
An apartment in a new building here can be bought from $300,000. The villas are offered at a price of $500,000.
Bavaro
Bavaro is a tourist centerthe resort of Punta Cana. It is here, on the coast, that most of the hotels operating on the "all inclusive" system are concentrated. From the Punta Cana area to Bavaro is only 15 minutes by expressway.
This area is also actively developing. The infrastructure in Bavaro is already at a high level – many supermarkets, restaurants with international cuisine, amusement parks, bars and discos are open.
In the heart of Bavaro is the Los Corales tourist area adjacent to the beach. There are many small residences in it, and cozy restaurants, cafes, shops are located nearby. All this makes Los Corales very popular.
A ready-made 1-bedroom apartment with an area of 55 square meters (with a balcony and parking space) in one of the residences can be bought today at a price of $90,000. In the primary market, such housing will cost more, from $ 140,000-$ 150,000. Almost all residences have a swimming pool, one or more, and some complexes also have a gym.
Los Corales is suitable both for permanent residence and for renting an apartment if you are planning a purchase in order to make a monthly profit.
In the center of Bavaro, a large golf microdistrict of Kokotal has been built. From the windows of the houses there is a beautiful view of the golf courses. The owners of the residence can use the beach of the hotel "Melia", which is located opposite the Cocotal. It can be reached by golf car. Residents of Kokotal are happy to visit the club, on the territory of which there are swimming pools for children and adults, a restaurant, a children's playground, a tennis court, basketball and volleyball courts.
The cost of apartments in Kokotal starts from $150,000. Villas are offered at a price of $500,000.
The neighborhood is suitable for your own living. Foreigners who have moved to the Dominican Republic love him very much. It should be noted that Kokotal is a great option for renting an apartment for long-term rent.
Real estate prices in Punta Cana
According to our experts, today in the Dominican Republic, the spread of real estate prices is very large, from $50,000 for a two-bedroom apartment with a parking space away from the coast to villas for several million.
The decisive factors in pricing are proximity to the beach, as well as the level of infrastructure of a particular location, the presence of a swimming pool, gym, golf course on the territory. In addition, often with the same area of two apartments, their cost differs significantly due to the peculiarities of the layout.
Housing off-plan is now significantly more expensive than from the owner. The reasons are: there are few available building plots in attractive places, that is, near the sea or ocean, as well as the rise in the cost of building materials. If there are not enough funds to purchase an object, you can use an interest-free installment plan from the developer, which is provided until the end of construction. The initial payment, as a rule, is 10-30%.
Unlike many countries, in the Dominican Republic, non-residents can take advantage of a mortgage secured by an apartment being purchased. For Americans, the rate in dollars is from 3.75%, for Russians - an average of 8% per annum. Banks usually provide a loan of 50% of the total amount.
Against the background of high demand for real estate, both among locals and foreigners, prices are growing rapidly. During the pandemic, when home sales declined due to entry restrictions, apartments from owners, according to realtors, cost about 15% cheaper, apartments from developers by 35%. The rise in prices on the market has occurred over the past year and a half, after the country again began to receive a large number of tourists from abroad.
There are prerequisites for the further development of the Dominican Republic as a tourist and investment destination. One of them is the creation of the US Immigration and Customs Service at the airport of Punta Cana. There is already a similar experience in Panama. Visitors will be able to cross the US border while physically still in the Dominican Republic, and then fly to America on a domestic flight. A separate terminal has been built at Punta Cana Airport to implement this project.
Who buys real estate in the Dominican Republic and why?
According to market experts, about 80% of clients in the Dominican Republic purchase real estate for investment purposes. Firstly, in a situation when inflation in many countries of the world is breaking records, people tend to protect their capital from depreciation in such an understandable way. Secondly, many expect to make money in a growing market. Thirdly, renting an apartment in the resort brings an average of 8-10% per annum. Having bought an apartment, you can sign a real estate management contract and get a good income. Rates for long-term rental apartments start from $500 per month and from $60-$350 per day for short-term. Villas are available for rent at a price of $ 1,000 and up to several tens of thousands of dollars per month.
Many foreigners decide to move to the Dominican Republic for permanent residence. These are, for example, wealthy people with passive income who buy a house and a couple of apartments for rent.
The second category of those who settle in the island state are young families with children. Often these are so-called digital nomads working remotely for a foreign company, or entrepreneurs opening a business in the country. They are attracted, in addition to the climate and friendliness of the Dominicans, by the developed infrastructure, as well as the high level of secondary education that they can give their children in private American schools operating here.
Traditionally, apartments and houses in the Dominican Republic are bought by citizens of the USA, Canada, Spain, Germany, France, Italy. Until recently, Russians also formed a large group among tourists and investors. It should be noted that guests from Russia are especially loved here, especially, according to research, Russian tourists who come for 2-3 weeks spend more in the republic than other foreigners (for comparison, Americans more often arrive on short tours, on weekends).
Today, the tourist flow from Russia to the Dominican Republic has significantly decreased due to the lack of direct flights (before the pandemic, planes flew five times a week) and the high cost of tickets. The situation should change with the opening in October 2022 of previously announced flights with a connection in Istanbul.
As in most countries, it has become more difficult for Russian citizens to buy real estate in the Dominican Republic. The reason is due to international sanctions against the Russian Federation that followed the outbreak of hostilities in Ukraine, settlements with apartment sellers are associated with difficulties. Nevertheless, transactions are possible.
The purchase of real estate in the country is not a basis for obtaining a residence permit, but it will certainly be a plus when considering your application.
Those who intend to move to the Dominican Republic, first apply for a resident visa at the consulate while still in their country. It allows you to obtain the first temporary residence permit in the Dominican Republic.The residence permit must be renewed every year for 4 years. This gives the right to work or conduct business in the country. Then the foreigner receives permanent residence (permanent residence). After 5-6 years, you can apply for citizenship of the republic.
A program for obtaining a passport faster through investments also exists, but the investment threshold is quite high - $850,000.
Thank you for your help in preparing the article by our experts in the Dominican Republic:
Anna Gladysheva, head of the company Arichy Immobilaria SRL
Ekaterina Belova, manager Surton S.R.L.
Author: Elizaveta Barskikh
Photos: depositphotos.com
Sources:
Wikipedia
