Investing in Dominican Republic

Another good topic.  Yes we are open to foreign investment.  Billions and billions of dollars are invested here. It ranges from massive new resort developments to small corner stores.

BE CAREFUL - this is the best advice. Unless you truly know what you are doing, understand the c

Unless you understand this country, the culture, the language and the laws it can and is difficult!


There are some great opportunities here and there are also those looking to part you from  your money!

Investing in a retirement home so you have your piece of paradise is very different from  building a resort!    Due diligence is everything here!   

Do  not just believe what your friend or realtor or your girlfriends lawyer tells you!   DOUBLE and triple check! Do your homework!

Once you have purchased a property, it can take years to sell it. This is not North America.  Dreams of a tropical retirement in paradise in your own home often give way to a need to sell. That is when you have a problem.

Absolutely.  And those with an idea to buy fix and flip   - hell no.

I've bought and flipped a few properties, and the quickest one was a little over 6 years.

Although I made money, it definitely isn't something you do if you're trying to make a quick buck.

Good article here:

More than sun and sand: The Dominican Republic’s road to growth

https://www.scotiabank.com/ca/en/about/ … rowth.html

I've always thought the country had great potential but endemic corruption and nepotism along with continuing inequality has slowed that potential being realized.

Curious.  I checked into CDs at our DR bank and the interest rate is much higher for a CD in Pesos vs. US Dollars.  Does anyone know why?

The peso depreciates more vs the dollar than difference in interest rates.

https://www.google.com/search?client=fi … eso+to+usd

lennoxnev wrote:

Good article here:

More than sun and sand: The Dominican Republic’s road to growth

https://www.scotiabank.com/ca/en/about/ … rowth.html

I've always thought the country had great potential but endemic corruption and nepotism along with continuing inequality has slowed that potential being realized.

I agree and maybe with the new government?

DR Visitor..  would you not recommend opening a CD in pesos because of the depreciation?  Just your thoughts I am not expecting you to be a certified financial planner 

It was the reason I keep limited money in it or open a cd.

Last year is an example:

The year  started and the dollar was about  52.6 pesos to the dollar.

The year ended  and the dollar was about 58.25 to the dollar.

That is the depreciation of the peso  in one year.

Planner is all about a country debt and some economies use it to attract buyers , look at the dollar versus euros same thing , it goes back to the Corona virus every country is jumping hoops to stabilize somehow their economies . This virus caught the entire planet that was healing already economically at the end of 2019 and beginning of 2020 like a ferocious storm, we are all going to pay more pesos for the same stuff that we buy daily. Who know we may all be buying things with bitcoins and speaking of bitcoins  digital currency is coming , block chain in transactions is already here and is suppose to make cheaper transfer of assets , contracts even medical therapies. When human intelligence can not handle things this is when A.i. will kick in at 100% , who knows maybe it will give all of us more time to relax , enjoy the beach, the works !! Blessings Krumite

trust me it happens everywhere except the pie down there is smaller, so is less of it. Look at the wold debt clock for a few minutes compare growth versus debt is very scary !! and somehow bonds are issued and some one buys it with a higher return on the risk and the world continues.

The CD ship has sailed.

For many years Dominicans could go to Banco Central and buy a CD directly from the Government.

During those days, the lines were long but the rates were high and well worth the investment. Many Dominicans put their nest egg in CDs and lived off of the monthly interest payments.

As an example: Back in the Hipolito days, My first certificate paid 52% for two years
. 
Yes.. 52%  and the peso was around 50 and change.

Then Leonel was elected, and the exchange rate dropped to 32  so the money I had in my CD almost doubled in value virtually overnight. An investor's dream come true.

I bought my first house here and was able to pay for it just using the interest I received.

My next CD was at 28% for 10 yrs. 

My third and last was 18% for 5 years.

Then the inevitable happened. 

Banks were not happy with people investing directly with the Central Bank and convinced the govt they could manage them better and eventually only Banks were allowed to buy CDs in large amounts then sell pieces of them to investors, keeping a huge chunk of the interest paid for themselves. Banks doing what banks do I guess.

The interest paid these days is below 10% and you don't know how much the banks are making on the deal.

It's riskier these days to buy one from the bank for a long period due to the volatility of the exchange rate, but I suppose for many it's worth it.

You can also buy CD's and long term deposit certificates from the bank, but I have not followed the rate s for the last few years. Few if any pay monthly.

You can also invest in other higher-risk investments for a slightly higher rate. (I think Presidente offered them a while back).

If you're interested, you need to go to your local bank and get current information from them.

One last note: I can stress how important it is to get to know the employees and management of your local bank.  Get to meet them and know them.

The last house I bought, I went to the bank, gave them the info of the house and its seller ( a repossessed house held by another bank) and that was it. 

My account executive called me about 10 days later and told me they were ready for me to sign.
And of course, any house financed by the bank will have a title, and their lawyers will make sure it's valid.

Thank you for the info jdjonesdr: I was checking a few banks last night like Banco Popular and Scotia Bank for CD'S they are a bit higher than in other countries like here in the U.S. , I was also checking about locally Dominican Republic Government Bonds but I could not find to see if I can purchase them when relocate without going thru a brokerage house. I was also reading about the perspective for growth in D.R. and it looks pretty good . Blessing everyone !!! stay safe . Krumite

Jdjones - how many years did it take you to developer that relationship?   I am curious but also making a point.  This won't happen quickly.

It's a whole different world here.

And yes in terms of projected growth we do well in the Caribbean.  There are a lot of reasons for this!   Bottom line is we have had good growth, let's hope it continues.

Steverino,
I noticed there are a lot of inexpensive properties listed now. I assume this may stem from the pandemic. Any thoughts?
I would not buy here until I could get culturally acclimated and then, perhaps never-I’ve seen another person mentioned it’s difficult to off-load real eastate.

Jdjonesdr,
Hi!
I’m coming to the DR this month, Santiago specifically.
I’m looking for a bank I can trust. I’ve heard bad things about Popular, hard to believe since they are se well established, but they aren’t very user friendly and nickel and dime you for everything.
Is there a bank you would recommend?
Mi español is not fluent enough to carry a decent conversation-I’m in learner mode...what are the chances they each have an English speaking person there?
Any other advice with regards to what to consider when selecting a bank is mucho appreciated.
Regards,
Rob

Dear Scorpiana: 

Can you recommend any particular realty websites??

I'm not seeing any particularly low-priced properties...but suspect I'm looking in all the wrong places. 

Would appreciate your recommendations!!

Jim
ExpatRusher

Scorpiana wrote:

Steverino,
I noticed there are a lot of inexpensive properties listed now. I assume this may stem from the pandemic. Any thoughts?
I would not buy here until I could get culturally acclimated and then, perhaps never-I’ve seen another person mentioned it’s difficult to off-load real eastate.

All banks here are way behind in customer service and in online platforms.  Banco popular is biggest and the least interested in customer service these days! 

That said get a bank that matches your needs. They all have fees and fees and fees!  No avoiding this.  If you use ATM all the time then the network of machines is important.  If you go to branch to do transactions the choose one with lots of branches.  You get the idea, figure out how and when you use the bank and go from there.

I do everything online including payroll so that had a huge weight in my banking choices!

www.ponint2homes.com is one I’ve looked at.
Some realtors respond quicker than others, some not at all...I recently asked for an address so I could do a Google Earth view, got no response.
Addresses are not well established there so perhaps this is why?
Apparently all you need to do there to be a realtor is simply claim “ I’m a realtor”...

The interesting aspect is trying to research previous price history. Unlike in the US records of price history are not around. Do your research as prices can greatly vary.

You are right anyone here can be a realtor!

Funny you say that because two people have met became realtors - one is a Canadian snowbird and started out as just a hobby Funny how things change fast...

Every taxi driver is a "realtor" if there is money to be made.  Lol

Sadly manyy think it's easy to do.   To do it right requires a professional in attitude and ethics!

There is a good reason that realtors won't give you a specific address! Unlike in the US, and I assume many other countries, there are very few properties with exclusive listings. If the realtor gave you the address for the property, you could contact the owner directly to avoid paying the commission and getting a lower price.

With our current rental villa, the rental agent made us a sign a document that said we wouldn't try to negotiate directly with the owner after the agent showed us the property.

The advantage of not having "seller's agents" is that your buyer's agent can show you any property, not just those they have listed. They get the full commission and don't have to share it.

All a sudden, I'm hankering to be a DR realtor.  Er maybe a Panama realtor, they also lack any legal beagle requirements etc. 

No exams, no training, no CE courses.  No Board of Realtors.

I 'spect I'm kind of talking myself out of buying anythun in the Dominican!!   Sounds like buying a pig in a poke!!  Lots of risks there.

Jim
ExpatRusher

p.s.:  My apologies for slipping into the Appalachian dialect.  Ist where meh peepel er fum.  Deep Kentucky mountains, coal miners or farmers every one, at least the menfolk.

I tend to slip back into the dialect when:
1)  I'm back home visiting, or
2) Whenever I get very nervous. 

In this case, the more I read about DR real estate, the more nervous I get. 

But I guess many others have done  so and survived. We'll keep lucking.

DD: 

Are you saying that you can have a legally-obligated, fiduciary relationship with a buyer's broker, with a contract and everything, like in the states?? 

Jim

ddmcghee wrote:

There is a good reason that realtors won't give you a specific address! Unlike in the US, and I assume many other countries, there are very few properties with exclusive listings. If the realtor gave you the address for the property, you could contact the owner directly to avoid paying the commission and getting a lower price.

With our current rental villa, the rental agent made us a sign a document that said we wouldn't try to negotiate directly with the owner after the agent showed us the property.

The advantage of not having "seller's agents" is that your buyer's agent can show you any property, not just those they have listed. They get the full commission and don't have to share it.

CDs are no good if they depreciate even faster than dollars.  Indeed, real investors dont just park their dollars either.