You’ll be happy to know that Punta Cana’s real estate market is hotter than ever. Our little corner of paradise is a mecca for global investors because properties here offer consistent appreciation. Whether you’re interested in new developments or resale properties, there are plenty of awesome deals to be had. The time to buy is definitely right NOW!
The buying process is quite similar to what you’re most likely familiar with in the States and Canada. We’ll help you find the right property then submit a written offer to the seller. Once your offer has been accepted, you will be required to send an initial deposit along with two (2) photo ID’s. We will connect you with an experienced attorney who will work on your behalf and who will transfer the title into your name after closing. If you are purchasing a pre-construction property, you will need to fill out a Reservation Form and Know Your Client Form. Don’t worry, we will walk you through each step and make this process as simple as possible!
When purchasing property in the Dominican Republic, buyers are required to pay a one-time transfer of title tax of 3%. This tax is based on the DR government’s assessed value of your new property. There are also yearly property taxes in Punta Cana of 1% of the value property that exceeds roughly $150,000.00 USD. So, as an example, if you purchase a home that is worth $200,000.00 USD, you would only pay property taxes on the $50,000 at a rate of 1%. Your bill would be $500.00 USD and this would be paid in two installments in March and September. Attorney fees are usually between 1 and 1.5% of the purchase price.
Many of our clients pay cash for their investment property in Punta Cana. There are also banks that can help you finance your purchase. Some banks offer loans of up to 70% for a 20-year period. Borrowers do require a credit score of 680 or higher. Be advised that interest rates in DR are typically higher, generally between 10% and 13%. We work with our clients to help them find the very best financing options for their investments.
The Confotur Law, also known as the Tourism Incentive Law 158-01, was instated in 2001 to encourage real estate investing and development projects related to tourism. Under the Confotur Law, developers and investors looking to build residential or tourist projects, and that have met strict criteria, are offered significant financial exemptions.
The law benefits not only the developers of buildings, but also individual real estate investors. So let’s say you buy a unit in a property that was developed under Confotur Law, you would be exempt from the 3% transfer tax, which results in big savings come closing time. And that annual 1% property tax is also waved for 15 years.