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The Dominican Republic has often been called the best real estate value in the Caribbean, but reasonably priced homes and property is not the only appeal.  Being situated on the second largest island in the Caribbean, the Dominican Republic offers buyers a diversity of topography as well.  From sugar white sand beaches to cool mountain breezes, the country does indeed offer something for everyone.  At prices that will not drain your wallet either.   In addition, high interest tax-free banking in US Dollars has made the Dominican Republic a  very attractive place to consider as well, for retirement or relocation.  Can You Afford a New Home or Apartment in the Caribbean?  Yes You Can...In The Dominican Republic.  See our Santo Domingo Section for new homes and apartments starting at about US$60,000.
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Homes in Santo Domingo - Starting at US$60,000
Farmland and Rural Properties Close to Santo Domingo
Juan Dolio and Boca Chica Areas
If you are interested in obtaining full and complete information about real estate in the Dominican Republic, then you came to the right place!  Articles and information include title transfer, title insurance, do's and don'ts for foreigners purchasing property and much more.
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To live on the beach or in the country - that is the question.  Why not have both?  The Dominican Republic does offers both, so why choose?  Have the best of two climates..... 
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Why are so many people like yourself deciding to relocate or retire to places like the Dominican Republic?  The answer is quite simple.   Better climate, lower cost of housing, and possibly even a more tranquil lifestyle as well.   Many of our clients have made the move, and are thankful that they have.  Even some young families have relocated also, citing lack of gun violence in the Dominican Republic and other problems so often found in the North-American school systems as well.  In addition, private education and even university costs are just as fraction of what they are in North-America....

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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.
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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.
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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$70,000.  So, there are many reasonably priced real estate opportunities out there.
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The photos to the right are new 3-bedroom apartments for sale in Santo Domingo, being offered at the US$ equivalent of (in Pesos):  US$57,000
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The Caribbean Country Squire Revisited - Country Caribbean Living at it's Best

About the Author:.
John Schroder writes for a number of publications, including the popular Ascot Advisory Weekly Update Newsletter (featuring information about the Dominican Republic and other topics).  He is a former veteran of Wall Street and is affiliated with Ascot Advisory Services - A firm assisting clients with residency and second citizenship matters, offshore incorporation services, banking and international investments plus Real Estate issues as well.  John has lived both in Panama and the Dominican Republic and currently resides in the Dominican Republic with his lovely wife, Carolina.
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A Farm In The Caribbean?  Did I hear you Correctly?
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Absolutely - a nice piece of farmland just far enough away from the hustle and bustle of a major capital city, yet close enough to be, well - close enough.  In fact, this is exactly what many of our clients are looking for.  Not a commercial farming operation mind you, but a nice tract of land, say 1/2 to 3 acres for example, whereby they can build a nice home for themselves and have some breathing room at the same time (not to mention peace and quiet).  
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To be sure, it might sound like a strange idea, as most people would tend to think of beach property when they think of the Caribbean.  However, while it is true that the Dominican Republic still has miles and miles of undeveloped and very affordable beach front real estate, it is also true that acre for acre, farmland may still be one of the very best bargains all around.  After all, even with some of the lowest prices in the entire Caribbean, the cost for 1 acre on the beach may be cost prohibitive for some clients (but farmland, being very very affordable).  In addition, many of our clients have said they want to take it easy, but not TOO easy.  So, in this regard, a nice stretch of land for growing flowers or vegetables, a horse or two - all on a very manageable piece of real estate may be just what the doctor ordered (not to mention you will never have to shovel snow again, and you can grow whatever you wish year round - thanks to the warm Caribbean climate).
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With this thought in mind, investors then may want to consider looking for such properties on the outskirts of Santo Domingo, the busy capital city containing almost 4 million people.  Many of our clients have already decided to do just that, buying a comfortable parcel of land for about US$35,000 (or more) - with the intention of building their dream estate home.  In other words, with the idea of becoming a Caribbean Country Squire - and why not?
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Having some acreage means you can put in a nice guest home on the property and a man made lake or swimming pool.  If you are someone with adult children or grandchildren, getting the kids to visit will never be a problem - especially when Grandma and Grandpa have a really neat home in the Caribbean (just 45 minutes from a Caribbean Beach). Being close to modern shopping malls. modern supermarkets, stores such as PriceSmart and not to  mention modern medical facilities and beautiful Caribbean golf courses, also means that you can - in a way have the best of both worlds.  The city and the country - blended into one.
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Making a value comparison to some of the over priced properties often marketed to foreigners or tourists, and considering the very reasonable labor costs in the Dominican Republic, it is very possible that you can literally own your own Caribbean Estate for less than have the price of these other properties (many European plumbers and other building professionals work part time for US$6 per hour, or you can hire local Dominicans for even much less) .  With the money you save, certainly investing it in a tax-free bank certificate of deposit (about 4% or more in US Dollars or up to 20% in Pesos) provides a locally tax-free monthly income to round out your Caribbean financial plan and just makes sense.
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That really is the reason many people are relocating to the Dominican Republic, as other Caribbean jurisdictions are simply no longer affordable, in terms of real estate or often general cost of living. For example, in the case of Americans specifically, having about US$300,000 in cash means you can forget about owning your own home mortgage free these days (either in the US or other Carribean spots) - never mind even thinking about living off your investment income in the US - but this is not the case of course in the Dominican Republic.  Plus you can finish your home with marble or high quality tile throughout - or we can also say in general, have a more luxurious home for the money - all at a fraction of the cost for a similar home in Florida or California (without the high real estate taxes either).
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Sound too good to be true?  Well, the first step is to contact someone who can show you some of the properties we have spoken about here.  For this and other additional information about residency or tax-free banking, please use our reply form below:
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Real Estate Taxes in the Dominican Republic
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There is tremendous confusion among investors with respect to real estate and property taxes in the Dominican Republic.  Local real estate agents often tell tourists that there are no real estate taxes.  In addition,  many Dominicans living in the US often indicate the same thing.  What is the truth and why do some people believe this?  This article will explain this problem, and try to offer a simple clear guideline to determine if you must pay annual property taxes on your real estate.  We will also try to clear up the confusion about titles, and title transfer taxes.  
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The Problem with Some Local Real Estate Agents
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One thing we love about the Dominican Republic, is the fact that it can be called one of the true Libertarian countries on earth.  Certainly, this was not the deliberate intention, but this is the reality.  The meaning is, there is minimal government regulation and oversight for many business sectors.  A businessman that is tired of government "red tape" and ridiculous regulations, will find the Dominican Republic to be a paradise.  The inherent problem with this, is that there are unscrupulous people that can take advantage.  In the case with real estate agents, there are no "truthful disclosure" statutes as they exist in the US.  In addition, the goal of many agents is to "make a quick sale", rather than develop an honest and long-lasting relationship with the client.  The concept of gaining future business from referrals seems to an alien concept for many.  To be fair, this does not apply to all real estate people, but such has been the case with enough that many foreigners have shied away from this wonderful and very affordable real estate market.
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The other problem, if not outright dishonesty, is a lack of professionalism.  Many Dominicans, not just real estate agents, do not know the tax regulations or other laws that exist in their own country.  For the average "man in the street", this is understandable.  For a "real estate professional", it is both unprofessional and unacceptable.
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Any real estate agent you are working with should be able to break-down the title transfer costs, estimated real estate taxes, and any other related information on paper for any property you are investigating.  The good ones will do it.  If you cannot get a straight answer to these questions, walk out the door.  This sounds terrible, but It is not.  The Dominican Republic offers the best value for real estate and investment in the entire Caribbean.  The lack of formal standards just means that investors must do a little "due diligence".  The phenomenal bargains make the extra effort worthwhile.
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The System is Confusing and Disorganized
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The lack of information about certain things is not entirely the fault of the people that you may encounter.  The government offices tend to give out conflicting information.  In addition, some of the tax code tends to be condradictatory at times.  If you put this into perspective, I would guess that half the people working for the IRS or Revenue Canada do not understand the tax codes they are meant to enforce.  In the past, I have contacted five different individuals in the Dominican government or private sector, and have received five different replies to the same question.  Similarly, my experience has been the same when making inquires to different offices of the IRS.  So, the point is, it is not all that suprising to encounter government clerks that do not know what they are talking about in any government.
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Things are improving in the Dominican Republic in this regard, but like any efforts of this kind, it takes time to trickle down to the bottom.  For the time being, do your homework and navigate the current system.  Once you learn the system, and you understand that you are dealing with a different culture, things will go smoothly.  For a guidebook, you may wish to purchase The Dominican Republic Report mentioned below. 
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One must also understand that tax sales or "Sheriff" sales are not the normal course of things in the Dominican Republic.  In most cases, the government tax office will not send you a formal tax bill or late notice.  Nor will anyone come knocking on your door if you are 12 months in arrears with your property taxes.  For this reasons, many Dominicans hold the impression that, the government either does not care about property taxes, or such a thing does not exist. Believe me, they care, and they will get you when it comes time to change title. 
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The Real Estate or Property Tax System
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Property taxes in the Dominican Republic are a form of "hidden wealth tax".  The meaning is that some properties, priced at a certain level, are not liable for annual property taxes.  So it is not false if someone says they do not have an annual property tax liability.  It depends.  Property taxes will be a function of whether or not the property is developed, the value of property, and the location.  Here is a general breakdown or "rule of thumb":
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Undeveloped or Raw Land - All undeveloped property in the Dominican Republic has a tax liability.  This concept was meant to encourage the building of homes, and discourage land speculation.  In the past, the Dominican Republic did have somewhat of a housing shortage.  Regardless of what any realtor or anyone else tells you, if you are purchasing a building lot or raw land, you will be liable for an annual tax liability.
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How much?  That depends on the location.  The government does have a tax schedule broken down on a tax map of the respective areas.  Areas considered to be "luxury" neighborhoods in Santo Domingo, such as Arroyo Hondo or Naco, will pay a higher tax schedule than "middle class" residential areas found in the Zona Oriental. 
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Homes or Developed Land - I mentioned earlier that real estate taxes are in effect a hidden wealth tax.  In order to encourage home ownership and home construction, the poor or lower middle class do not pay annual real estate taxes.  How so ?  Homes valued at  a certain fixed amount are exempt from annual property taxes.  Homes valued above this amount are liable for annual property taxes based upon a schedule for the valued amount above that.
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To put this in US Dollar terms and to apply it to the current real estate market as of December 2004,  a home or apartment that would be considered American or European standard will cost anywhere from about US$75,000 on up (for a most middle class home, new construction) and about US$100,000 on up for a luxury apartment.  Keep in mind that while these prices may seem similar to what the prices are in other jurisdictions (such as Panama, for example) you are getting more (if not double) for your money in Santo Domingo.  Stated another way, on average, a new 100 square meter (about 1,000 square feet)  3-bedroom apartment in Panama costs about US$100,000.  A new 180 square meter (1,800 square feet) 3-bedroom apartment in Santo Domingo costs about US$100,000 (or perhaps slightly more).  So, while the prices may be similar, the size of the apartment surely is not.
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Building A Home on your Lot - The most confusing aspect of the property tax code becomes evident when discussing the idea of building a new home on property you have already owned for a while.  In theory, it is possible to have an annual tax bill when the property was undeveloped, only not to have an annual tax bill if both the property and dwelling are re-valued below the amount we spoke about earlier.  Again, the government incentive is to build or own a home.  The problem many foreigners encounter when buying an existing home from a local Dominican is as follows. 
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The Tax Man Cometh
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Many Dominicans, in an effort to cheat the tax system, do not file the construction documents, nor do they report capital improvements when building on property.  In fact, a large percentage buy a building lot, and then go ahead with a private building contractor without filing for construction permits.  Many may purchase the land, build a home, and never pay taxes at all.  How is this possible?  Remember that a Sheriff's sale for back due property taxes is an un-heard of concept in the Dominican Republic.
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The government will get you when it comes time to transfer title or sell the property.  It is difficult to explain to the authorities how a house has existed for 10 years, without the existence of such a property on the tax map.  Never the less, this is the problem.  Many owners wishing to sell their property may not have paid any taxes, and may not be able to pay the tax bill (including the 50% multa or fines) in order to clear title transfer.  This problem, in and of itself, is one reason buyers have a problem obtaining a new title rapidly with some properties. 
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Title Search & Title Transfer
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The previously mentioned issue is just one reason why an independent title search by you, the buyer, is highly suggested.  But this is not the only reason.  Like a very large number of other countries, there is title insurance in the Dominican Republic. However, the buyer should thoroughly research any property that they are considering. Partly for back tax issues, but also for ownership.  In the past, there have been individuals who have attempted to sell land they did not even own.  In truth, this has been more of a problem in the countryside, or with some very old properties, but it has happened.  Also, considering that the Dominican Republic does recognize squatter's rights, you could encounter someone that has built a home & lived in it for twenty years. That does not necessarily mean that they own the land underneath it, or that they have gone through the process of obtaining legal title through the court system.
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Again, this is more of problem with some older properties or raw land in undeveloped parts of the country.  I do not want to give the impression that every home you encounter will have a title problem associated with it, but it is a concern to keep in the back of your mind.
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One little trick some real estate agents like to play is, "hide the title transfer tax".  Every title that is transferred in the Dominican Republic, be it a home or undeveloped land, carries a list of taxes or fees that are equal to roughly 7% of the property value. Period.  There are no exceptions to this rule.  I do not care what your Dominican neighbor in New York told you.  This is a fact.  Real Estate agents will often "hike up" the selling price, in order to cover the taxes that they know must be paid to transfer title.  Some will go so far to tell you that there are no title transfer taxes or property taxes in the Dominican Republic.  That sounds wonderful, but won't you be surprised when it comes time for you to sell your property five years later (thinking that you did not have to pay this when you made your purchase).  Believe it.  You paid it, you just did not know it.  More correctly, it came out of the net settlement to the seller, minus the broker's commission and anything else tacked on. 
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We have heard of one broker telling potential buyers the total costs for property transactions in the Dominican Republic are 20%.  I do not know what kind of calculator this guy owns, but 5% + 7.48% = 12.48% (and remember that the 5% can be negotiated down).  In all honesty, there is no cap on real estate commissions in the Dominican Republic, and some agents may in fact earn up to 40%.  Just keep in mind that title transfer taxes paid to the government are non-negociable, but real estate commission certainly is. 
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Life is Beach (or at least life can be lived on a beach)
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If this article has discouraged you from buying a piece of Caribbean paradise, it was not meant to.  Opportunities and difficulties exist in every market.  The key is understanding the "rules" and the local culture.   Most foreign buyers have been burned in other real estate markets, because they were easy targets, and because they did not know any better.  Learn the rules and the tax codes.
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The truth is, the Dominican Republic offers some the least expensive real estate, and one of the largest percentages of virgin beach front property in the entire Caribbean.  Is the title transfer tax high in comparison to other places? Sure it is, but the government has to get tax revenue from some source.  After all, considering that bank account and investment account interested is 100% tax free (on US Dollar accounts and certain types of peso investments), and that it is possible to own a home that might be 100% free from annual property taxes, the Dominican Republic is one of the best deals around..