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Why are so many people just like you relocating to the Dominican Republic?  It is really the new sactuary for middle class Americans and Europeans trying to escape the hight cost of living and high taxes back home?   Find out.
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Real Estate prices are now sky high in the United States and Europe. Is now the best time to take profits and invest in the Caribbean or Latin America? How can real estate abroad help with taxation back home?

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The Dominican Republic has been called one of the best and last remaining property bargains in the entire Caribbean.  In fact, it may also be one of the very few destinations that can also offer so much in terms of diversity:   Metropolitan areas such as the Capital City of Santo Domingo or Santiago, Beach Resort areas such as Punta Cana, Juan Dolio, Samana, and many, many others.  For those that want to simply live in a warm weather climate, but are not fans of living in a beach community, the Dominican Republic also offers beautiful mountain regions - often called the Alps of the Caribbean, offering the highest elevations as well (during the months of January & February, there is frost in the areas surrounding Constanza and Jarabacoa in the early morning).
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The Alps of the Caribbean.
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So the Dominican Republic does truly offer the best of all things, all in one place, all in the second largest island in the Caribbean.  But having a wide range of lifestyle choices, in terms of real estate and climate is really not the main benefit.  Instead, as with many other things in life, it comes down to affordability.  In this regard, the Dominican Republic shines above many other Caribbean destinations in terms of affordability for most American and European families.  Which to say, many people do come to visit as a tourist, but only after they realize how affordable it can be to own a second home, relocate or retire to the Dominican Republic, do they then jump at the opportunity.
How affordable is a new home or apartment in the Dominican Republic?  Obviously that all depends upon where you look, as certainly beach front property will be more costly than farmland, for example.  In addition, there are a great number of packaged beach communities or resort based communities offered for sale to tourists and what can only be described as outrageous prices.  But fear not.  There are many, many reasonably priced real estate opportunities in the Dominican Republic, if you know where to look and if you stay away from properties markeded only to tourists in English.  For example, did you know that as of March 2005, you can purchase a brand new 1,500 square foot, 2 or 3 bedroom apartment in Santo Domingo for about US$65,000 (on up) or a brand new single family home for about US$120,000 ??  In addition, even in beach resort areas, such as Cabarette, some people have purchased one bedroom ocean view beach front condos for about US$70,000.  So, there are many reasonably priced real estate opportunities out there. apartments homes for sale
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Build, buy or rent, the Dominican Republic still remains to be an ideal destination for real estate bargains, and as a possible retirement or relocation destination as well.  In this article, we will discuss the current real estate market (how to find the bargains plus local constructions costs to build your own home), but also want to highlight in general why the Dominican Republic is so attractive overall for those seeking to live in the Caribbean.

First and foremost, while finding reasonably priced real estate is of importance to many, there are other considerations equally important as well.  One such consideration is what I would call “Island Fever”.  That is to say, many believe the stereotype of a typical Caribbean Island as a postage stamp sized location under the sun, and this is often the case with many islands.  Aruba, Antigua, Tortola and others, (just to name a few) are indeed very nice islands, but chances are you can drive such an island completely and still be back in time for lunch.  While this may be quaint and appealing for some, a good number of people often eventually feel confined or claustrophobic as a result.  The Dominican Republic in contrast is located on the second largest island in the Caribbean, offering both high mountains with pine trees and ferns, plus beautiful white sand beaches all at the same time.  Many have compared the land mass of size as being about or slightly larger than the US State of South Carolina.  As an illustrative example, the drive from the modern metropolitan capital city of Santo Domingo (population 3.6 Million) to the North Coast town of Puerto Plata takes about 3 to 4 hours.  The drive from Puerto Plata eastward to the Samana Peninsula takes an additional 4 hours.  If you want to drive from Santo Domingo to the Punta Cana or Playa Bavaro area, figure on about 4 hours as well.  So, if you want to see the country, pack either an overnight bag or lunch, depending how far you want to go.
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This of course leads us to the discussion of diversity, quality of life and other issues.  If you want to live in the Caribbean, but still want the benefits of a city, then Santo Domingo or the second largest city of Santiago (population 1 Million) might be your choice.  What’s in Santo Domingo and Santiago?  Movie theaters showing recent releases one week after they open in New York or elsewhere (in English with Spanish subtitles), plus a variety of international restaurants as well (not to mention a variety of clubs and nightlife).  For other activities and shopping, there are bowling alleys, art museums, orchestra and ballet, modern shopping malls, supermarkets stocked with a number of American and European brands, PriceMart, Radio Shack and other familar chain stores.  Many major universities also, just in case you want to keep busy by studying for a medical degree at a cost of roughly US$1,000 per semester.  Of course if your idea is to get away from it all, then you have the option of the highest mountain range in the Caribbean or miles of uninhabited beaches.  If your ideal place involves having the best of both worlds, well – you can.  Couple this with high interest tax-free US Dollar banking or other investments (current interest rates are up to 7% for US Dollar deposits, interest paid monthly) and online internet banking access, the appeal for many is not too hard to understand. In addition, three major international airports offer direct flights to New York, Miami, Philadelphia, Panama, Venezuela, Aruba, Spain, Holland, Germany, Martinique, and France (among other destinations).
Now that you can understand why someone would consider the Dominican Republic, let us discuss the real estate market by starting with the nation’s capital, Santo Domingo de Guzman.  Just as in the case of any growing city, Santo Domingo is expanding, primarily to the north and to the east (towards the airport).  As a result, smart investors might want to buy inexpensive land on the fringes of the city and wait for the city to come to them.  This is in fact when happened in places like Los Angeles, during the boom period of the 1950’s to the 1970’s.  In fact, as of spring 2005, it is still possible to find 5,000 square foot home lots in a new residential housing project 20 minutes from the city center for the equivalent of US$20,000.  Similarly, you can find other properties outside of a planned development, such as one-half acre parcel starting at the equivalent of US$25,000.  So, the reasonably priced properties are out there, all within close distance to modern stores and conveniences.   But while properties in the city center of Santo Domingo might still seem reasonable in comparison to North-American cities, such as Denver, Toronto, Seattle or Chicago the fact is that prices have come up.  This in part has been a function of the economy  and also demand (many Dominicans are now moving back from New York and elsewhere).  As a result, the real bargains are to be found on the outskirts.  As an example, new luxury 1,700 square foot (and up) apartments directly within the city can be purchased for about US$100,000 and up (2 or 3 bedrooms plus maid’s quarters, 24-hour doorman, intercom, off street parking, etc.).  Small new homes in residential tract developments will start off at about US$75,000.  However, as we stated, one can purchase a building lot within 15 minutes of the city for about US$20,000 and build what you like.
While building costs will of course vary on how complicated or luxurious you build, costs will of course be a function of how you want to finish the house (imported tile, marble floors, types of windows and doors, very upscale kitchen, etc., etc.).  To offer an illustration, one client told us they obtained an estimate of US$107,000 to build a 1,000 square foot hunting cabin in the southeastern United States.  In the Dominican Republic, an identical sized home will cost about US$45,000 more or less to complete (in fact there is a builder offering new 1,200 square foot homes 20 minutes outside the city for US$50,000 - on a 2,000 square foot lot.  However, it is important to note that we are talking about a home built with cinderblock, poured concrete and metal bar inside the block.  Wood construction is actually more expensive in the Dominican Republic and no one in his or her right mind would build with wood anyway.  Concrete or block is stronger, insect and weather proof, and can be finished in such a way in that you would swear your walls are solid poured plaster (the way they used to build houses in the US or Canada 80 years ago).  If you finish the outside facing with attractive local stonework you can have a very attractive home that would be almost prohibitive cost-wise elsewhere.  Plus, you will have a house that never needs painting and will last more than a lifetime.  Not fancy enough?  Add a red or orange colored Spanish terra cotta style tiled roof or imported Italian and Spanish ceramic floor tile.
While some building materials will cost about the same as they might in North America or Europe, the real difference can be found with local labor costs.  A seasoned master mason will charge about US 70 cents per block for labor.  General construction labor will cost about US$10 per day (no misprint, per day – not per hour).  Other labor such as plumbing (using the very same PVC pipe used in the US) or electricity at equally reasonable costs, but you must of course shop around and get a few estimates.
The real key of course to finding real estate bargains involves staying away from the normal traps.  That is to say, there are always two markets, one for the locals and one for the tourists. Can you guess which costs more?  While it certainly may be more comfortable for you to obtain a nice brochure in English with pretty photos, you can believe you are paying for it in more ways than one.  Stated another way, while some very nice residential developments exist, such properties being offered at US$80,000 for a building lot or US$400,000 for a home are not only outrageous in price, but also way off what a local Dominican would pay for the same thing elsewhere. So, learn to look where tourists fear to tread or may not know about, which most certainly involves brushing up on Spanish (the official language of the country).  In summary, the true real estate bargains and true local real estate prices are not to be found by reviewing real estate being marketed in English, or by visiting some of the high priced real estate chains either.  Bargains will be found by doing some of your own investigation and by talking to the local people directly, and simply by scouring the local market.
We discussed the city of Santo Domingo, but what about the rest of the country?  Certainly, there are a number of very inexpensive or reasonably priced properties both in the mountains and at the beach if you know where to look (and if you poke around in the countryside yourself).  In the past, one of our clients reporting buying a roughly one acre lot on a bluff overlooking the ocean (North Coast) for US$22,000.  Another client has purchased 8 acres of farmland for US$27,000.  Yet another purchased a smaller building lot for US$14,000.  One client rented a small but very nice home in the mountains for US$350 per month.  In Santo Domingo, a brand-new 4 bedroom 3 bath home (the master bath even has a jacuzzi) in a residential area recently rented for US$475 per month. Granted, these are examples of what some of our clients have paid in the past (2001, 2002, 2003, 2004) but the point is that these situations are possible, if you take the time to scout around.  Stay away from ads offering rentals in US Dollars.  You will find a few of these kind of advertisements, but no Dominican in his right mind would (and certainly most do not have the capacity, even prefessional people) pay US$1,500 monthly rental for a home or apartment.  The highest priced monthly rentals we have seen (in pesos, for a very upscale apartment in Santo Domingo) have not been more than the equivalent of US$800 per month, and even this is high by local standards.
Where are some of the best places to investigate?  Well, mainly in those places, which are undiscovered by tourists or we can say undeveloped.  For beachfront, such areas include sections of Barahona, west of Santo Domingo and the areas near Miches and Sabana de La Mar on the inside bay of Samana.  The Samana peninsula also is a beautiful spot and is also one place to look as well.  However it is starting to become discovered and this in and of itself has driven up some real estate prices accordingly.  For property in the mountains or non-beachfront, areas around Salcedo, Monte Plata, and San Juan offer some prospects.
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