FAQs about buying property in Dominican Republic

• What are the procedures?
• How much does it cost?
• Taxes
• Can I let my property?

Purchasing property in the Dominican Republic is a relatively easy process. There are no particular prohibitions that block or otherwise prevent a foreign national from purchasing real estate in the Dominican Republic. Indeed, many foreign nationals invest in and own real estate in the Dominican Republic and have done so for many years.

The buying and selling of real estate in the Dominican Republic is subject to the Land Registry Law of the Dominican Republic. Pursuant to the law of the Dominican Republic, the first step in purchasing real estate in the Dominican Republic is the execution of a contract for sale between the buyer and seller.

In the Dominican Republic, it is a must that the contract for sale be signed in front of a notary public. In the Dominican Republic a notary public must have a law degree. The contract for sale sets forth the general terms and conditions of the sale -- a description of the real estate being sold, the agreed upon sales price and other matters relating to the transaction. The buyer normally posts a deposit for the property that can be upwards to 10% of the total purchase price of the real estate in question.

Once the contract for sale is signed and notarized, the document is then taken to the Internal Revenue Office. At this juncture, a determination is made as to what taxes will be due and owing because of the sale. The appropriate taxes need to be paid in advance of the final conveyance of the property from the seller to the buyer.

After the financing completely is arranged and all of the conditions set forth in the contract for sale have been realized, the contract for sale and a certificate of title (designating the buyer as the owner of the real estate) is then filed with the Title Registrar's Office.

In some locations in the Dominican Republic there can be a delay of upwards to a month before the Title Registrar's Office is able to issue a new title to the real estate. In other areas in the country, the office can issue the title as quickly as one day. In the Dominican Republic the buyer bears a fairly heavy due diligence burden when it comes to the purchase of real estate.

In other words, if the buyer does not undertake a course of due diligence to make certain that there are no encumbrances on the real estate, the buyer very well may be stuck with a lost deposit and being unable to take full title to the real estate in question.

How much are legal fees?

You should allow for between GBP1000 and GBP1500 for legal and government fees.

What are connection fees?

New properties are connected to electricity, telephone and water supplies on the completion of the development and the utility companies charge each property an amount based on the cost of connecting the development. The cost varies depending on the area and the distance from the nearest supply but is rarely more than £500 in total.

Are there any service charges?

Most new developments of villas or apartments that have communal facilities now arrange maintenance and will charge an annual service charge.

Running Costs

• Annual Municipal Taxes are normally less than £100 p.a.
• Electricity supply is 120 volts AC 60Hz. The power supply is subject to disruption and we can supply back up generators or UPS systems on request.
• Drainage for individual properties is normally via individual septic tanks which require servicing every 18-24 months at a typical cost of £25.
• Telephone lines can take several months to be connected but do provide International direct dialling. Internet connections are relatively cheap at no more than £10 p.m. Broadband is available by satellite but is expensive at present.
• Satellite (US) TV is available.

In a bid to increase tourism, the Dominican Republic government has launched a few tax incentives, such as no stamp duty, no tax on rental income, no capital gains tax for 10 years and no tax on purchases. This brings the island in line with many others which offer favourable tax breaks.

What are the holiday letting opportunities?

The holiday market is growing rapidly and there can be a shortage of hotel rooms at peak seasons. The letting market is therefore buoyant and we offer a management and letting service for our developments that should produce a healthy income.

Please call 01252 376003 for more details

With the right people assisting you, purchasing an overseas property can be an enjoyable and rewarding affair ... one, we at Property Club International are familiar with. If you still have questions having read this section, please don’t hesitate to contact us!

Some of the information in these sections has been supplied by third parties and Property Club International Ltd and its associated companies cannot be held responsible for any errors or omissions. Professional advice should always be sought at the time of purchase. Please note that tax rates may differ from the examples given above,are subject to change and will be applied at the rate ruling at the time.