Is Purchase of Real Estate by Foreigners Permitted?

The Dominican government has created laws to promote foreign investment and there are no laws restricting foreigners from owning land. There are no restrictions on foreigners purchasing real estate in the Dominican Republic. The only requirement is, the real estate purchase must be kept on record at the Title Registry Office (Decree 21-98 of January 8, 1998)

 

How do I buy Property in the Dominican Republic?

 

1. The buyer and seller must sign a "Contract of Sale" before a notary (Notaries in the Dominican Republic are required to have a law degree). The Contract of Sale will contain the legal description of the property, the price and other conditions of sale.

2. The Contract of Sale is then taken to the nearest Internal Revenue Office for payment of the appropriate taxes. (Approximately 2-5% of purchase price)

3. The Contract of Sale and the Certificate of Title of the seller are deposited at the Title Registry Office where the sale is recorded.

4. The Title Registry Office issues a new Certificate of Title in the name of the buyer and cancels the old Certificate issued previously to the seller.

How do I find a good solicitor

There are various Notaries and Solicitors with good reputation is the area.  Buyers of property in the Dominican Republic tend to use a Notary for property purchase as this is just as effective but cheaper.  The normal fees are around 1%

Can I be sure of Title

Yes, The Notary will confirm the status of the Title to you and it will be clear to you at the time of purchase that you have good Title.  You should only buy if the Notary can confirm the safe status of the Title.

When do I have to pay for my Caribbean home

This will depend on how far advanced construction of your home is, who the builder is, and varies from development to development.  However, assuming the purchase is “Off-plan”, the norm is that you will pay around 10% on signing the contract, a further 25% when ground is broken, 25% when the roof goes on, 25% when windows are installed, and the 15% balance when the keys are handed over. You, will of course, be asked to place a holding deposit at the time of sale and before contracts are drawn which will be part of the sale price.  We will explain this in detail on a case-by-case basis.

How can I finance my purchase

Most people buy in cash or by refinancing their primary homes. Many banks and financial institutions can assist you in your home countries.

Are there any extra costs at completion/closing

Yes. Normally you have to pay a transfer tax of around 3% of a valuation price which is usually less than your buying price.  However, some of the larger developers provide a service whereby the plot of land or the home you are buying is owned by a free standing company, quite separate to the developer, and which has never been used for anything other than to own the property. The shares in the company are sold to you for the buying price which saves transfer fees.  This is a perfectly safe method and widely used.

Are hurricanes a threat in the area

The 2005 year was one of the worst hurricane years on record.  We all remember Katrina.  The north cost of the Dominican Republic did not have a single hurricane pass over or near it.  Occasionally a hurricane will hit the south east tip of the island around Punta Cane or the north west around Haiti but we very rarely receive them as geographically we have our own eco system which is unattractive to Hurricanes.

What amenities do the communities offer?

 

All communities are different of course but as a guideline The Gardens at Lomas Mironas feature: Gated entrance, fenced community exterior walls, on-site security, Constant electricity and well water, sewage disposal, paved roads, landscaped and maintained public areas, control of building design to ensure uniformity of aspect. Noise level controls.

 

What are my fixed running costs?

 

Again this varies from community to community but at The Gardens at Lomas Mironas homeowners dues are shared between the villas and are currently $60 per month.  

 

Who will manage my property after it is built?

 

Most developers will have a management program or will provide advise on who to use. We will explain this to you on a case by case basis.

 

Are there any special offers?

 

Rarely. The demand for premium property is so high in the Cabarete area that developers cannot supply fast enough. However, on occasion we can provide some exclusive property which is available only via USH Realty. Your adviser will tell you of any offers if they are available.

 

How is my legal ownership recorded?

 

You will own outright the unencumbered shares in your own company which in turn owns the free and unencumbered title to the land (and the house upon it). Alternatively if you are happy to pay transfer taxes, you would own the recorded title to the land.

 

Can I sell the property whenever I want?

 

Yes you can. If you sell the company owning the property you would not pay local taxes on the sale.

 

Can I take my money out of the Dominican republic?

 

Yes.  There are no exchange controls and the currency is a freely floating and values against the US Dollar, sterling and the Euro and other international currencies.

 

As a foreigner, will I have to pay taxes on investment earnings in the DR?

 

No. The tax laws are the same as in the rest of the Latin American region; you can rest assured that interest is accrued on your bank deposits and investments, completely exempt from DR taxes.

 

Does the Dominican Republic have political stability?

 

The Dominican Republic has enjoyed more than three decades of stable democratic conditions. The DR is considered a model Latin American country.