Punta Cana and Dominican Republic Real Estate - What to Expect in 2009!
December 2005 was a dissimilar time in Punta Cana and the Dominican Republic. At that time, the Punta Cana and Dominican Republic real estate markets were experiencing what some would think atypical growth.
Punta Cana and Dominican Republic Real Estate - What to Expect in 2009!
Demand was far greater than the supply, a thriving influx of international buyers, lowest interest rates in the history of the Dominican real estate market, both Us dollars and Dominican pesos, national and international economic stability, high rental income, mega tourism developments sprouting like wild flowers, international financing, bonds were issued, free favorable press, and tourism numbers at an all time high. Buyers were looking for whatever developing or selling near the tourism hubs of the island.
Those were the good ol' times! It was about being in the right place at the right time.
Many considered that there was no reckon for the Punta Cana and Dominican Republic not to be known as the "Home of the World"; however, it was also emphasized that it was imperative for the real estate business to take some considerable measures in order for amelioration to continue in an organized fashion.
Fast forward to end of 2008. Today, the real estate business is also experiencing a completely atypical situation, which unfortunately can't be called positive, but can't be called negative either. It is going back to what is considered a normal, standardized real estate market. Contribute and request more in equilibrium than in years past.
Any real estate developer can tell you that it is not normal to sell an whole amelioration in less than a year. normal would be for at least two years to sell a small to medium size amelioration and maybe more time on the larger more ambitious developments within ended gated communities. Of course, it is normal to think that things are cooling off after arrival out of the "Boom" we have been experiencing for the past few years. Instead of cooling off, I would call it firm as usual, going back to normal, Contribute and request in equilibrium!
At the occasion it is foremost to sit down and analyze the "foundation" of our market as we take the considerable corrective measures based on lessons learned.
First, let's look at the foundation. Why the Dominican Republic? Why Punta Cana? What makes us so special? Why are Punta Cana and the Dominican Republic relevant venture markets? Why alternatives for second home buyers? Why should it be considered ideal places for retirement?
Excellent geographical location that allows us to have year round tropical climate. The cold countries remain cool. We continue to have some of the best white sand beaches and turquoise colored crystal clear waters Legal Framework - No Restrictions for Foreigners, Equal rights rights Economic Stability public Stability Personal Safety, Dominican Republic crime rates are low in comparison to other Caribbean Neighbors modern and sufficient communication and telecommunications infrastructure (airports, seaports, highways, telephone, internet). There is room for improvement, but we are headed in the right direction. Thorough complementary offer (water sports, golf, restaurants, grocery stores, resorts, casinos) Ecotourism The Dominican habitancy - all the time kindly and hospitable!
Beyond these points, we must recognize that there has been encouragement for foreign venture by the local government. Foreign direct venture more than doubled in 2008, agreeing to statistics from the town for Exports and venture (Cei-Rd). venture in 2008 totaled Us.35 billion, for a 55.1% growth from 2007.
Just last week, December 12, 2008, Dominican Republic President Leonel Fernandez broke ground for Us.4 billion dollars VistaCana Resort & Country Club in Punta Cana. President Fernandez and the project's main promoter, Salvador Termín headed the groundbreaking ceremony, with Tourism minister Francisco Javier Garcia also present. Mr. Termin spoke about the world urgency we are experiencing, and emphasized that they have ready themselves for the crisis. "We have decided to continue to invest, since that is what we do. We believe in the Dominican Republic since it continues to be a safe place to spend with lower risks in comparison to other places around the world".
Venezuelan investors began construction of the tourist complex on six million quadrate meters of land. The complex will have 6,000 residences, a 100 room firm hotel, a 27-hole golf policy and a 180,000 quadrate meter synthetic lake integrated to the beach area, and built at a cost of arond Us.4 billion dollars. This will bring 20,000 new jobs to Punta Cana when concluded.
President Fernandez said "this amelioration is proof that within the global urgency that we live today, foreign companies like the developers of VistaCana, testify that the Dominican Republic still has economic and financial security for world wide investors, developers and end users alike. 1,500 homes have been purchased by an venture fund for North Americans retirees out of Washington D.C. Plus more than 200 units sold to individuals." President Fernandez added that in increasing to VistaCana, just last week he was in La Romana for the groundbreaking event for the mega amelioration Playa Nueva La Romana by Spain's Grupo Piñero, owners of the Gran Bahia Principe Resorts. This represents Us.5 billion dollars in foreign investment. In addition, in the arrival days, President Fernandez will be alongside the Prince of Monaco, in the groundbreaking ceremony for Punta Perla settled in Cabeza de Toro near Punta Cana, with an additional one Us.6 billion dollars in foreign venture from the U.K.
That is a total of Us.5 billion dollars of foreign venture in the month of December alone for the real estate industry. These are big numbers from world wide known companies and investors that have very deep pockets to show the way feasibility and market studies. They have decided that the Dominican Republic is the safest place with the best venture opportunities in the Caribbean and maybe the western hemisphere.
In increasing to encouraging foreign investment, local government has achieved:
Enactment of new laws that attract retirees and baby boomers. Incentive for pensioners and annuitants reduction of taxes related to real estate Firm decision to heighten communication infrastructure to the tourist areas productive and best system for the approval of new developments public sector working hand in hand with underground sector to help make joint activities aimed at strengthening the real estate industry.
We can say that without a doubt we have a solid foundation for sustained growth in the real estate industry; however, no longer is location, location, location the most foremost part of deciding where to buy real estate in the Dominican Republic. Investors and buyers alike are looking for security, security, security.
First and foremost, the security and security of their investment. Investors and buyers understand that property acquired in the Dominican Republic is not going to suffer the effects of devaluation that other world markets have experienced. This is for several reasons: Historically in the Dominican Republic property values have all the time tended to go up and never down The Dominican Republic does not have a secondary market for the marketing of securities where good and bad mortgages come together. We all now about the Usa mortgage mess that has property values on a downward spiral. Given our past feel with the banking system, the mortgages could be considered "healthy", meaning that the market value of the property exceeds the value of mortgage.
Second, security of rights rights, of course. Foreign buyers are guaranteed the same rights as those ready to Dominican buyers.
Third, security of return on your investment. Real estate-tourism products have the potential to originate revenue because they can be rented to employees in the tourism sector and also because each day is further industrialized the so-called "residential tourism." Refers to those tourists who prefer to rent a villa or apartment to take a more well-known feel and learn more about the area of access.
What do we need to do as business leaders and real estate professionals?
Find end users: Avoid clients who seek an immediate capital gain. This refers to buyers/flippers who have neither the intention nor the quality to close on the real estate transaction. The best way is to ask for a considerable down cost that the buyer/flipper will lose if decides to walk away from the real estate transaction. Pre Qualify Buyers: Contribute the buyers with the permissible forms and feel data for pre qualification with local banks. This will forestall from time to come headaches in the future. Accomplish target marketing plans for buyers and investors required for the singular development. Carry out strategic alliances with government institutions to promote the Dominican Republic as a tourist destination, not just a real estate destination. Join soldiery with high profile tourism developments for further commercialization of the Dominican Republic. Be aggressive in marketing products in more than one way: originate alliances with international real estate agencies, non former advertising, speaking engagements, eMarketing, and so on.
The most foremost thing is to understand that we have a good product. We are in a cycle of the market where change is sure and considered normal. There is no need to panic. Punta Cana and the Domincan Republic have become world destinations. We still have many great years of selling Punta Cana real estate and Dominican Republic real estate. We just need to roll up our sleeves, continue to work with ethics, be honest, creative and pro-active. We have no doubt, sooner or later Punta Cana and the Dominican Republic are destined to become the Home Of The World!
We expect many good things to come in 2009 and are very sure that we will make a dissimilarity and detach ourselves from the rest of the crowd. With the alliances that we are forming with real estate agencies from around the world, we will by all means; of course position ourselves as the #1 real estate firm for developers, buyers, sellers and investors that are looking for the right firm to sustain with buying or selling real estate in Punta Cana and the Dominican Republic. Hope we can be of assistance in 2009! We will help you find the right home in Paradise!
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