Posted by: Orekh Schriftsteller | October 9, 2011

Simple Steps to Buying Property in Dominican Republic

Real estate in Dominican Republic’s Overview

Real estate in Dominican Republic features Caribbean and Atlantic waterfront and beachfront, island, highland, mountain, rainforest and agricultural property options. Property prices are affordable and on par with well-known locations 10 to 20 years ago, which is why, there are always excellent deals to be found.

Buying real estate in  Dominican Republic  is very similar to the way it is managed in other countries. Most properties have titles or can be titled, title insurance can be bought, traditional mortgages are available and Dominican Republic  has foreign investor protection laws that guarantee the standard rights of land ownership

Here are the steps to purchasing property. You’ll see that much of the purchasing process is identical in nature to  Canada or  US. The bottom line is Dominicans, just like citizens of other nations including Canada, Spain or  US, have been buying, selling, and transferring property for centuries– remember first Spaniard settlement in the New World–and because of increase investment activity there are safeguards against fraudulent activities have been set in place to protect your purchase long before your arrival. Before, during, and after the purchase of your property, you can rest assured that your interests, and those of the seller, are protected by legislated law.

Step 1: Agreement and Research

You’ve found your property and have agreed on a price with the owner. Next, you inspect the title (Escrituras). This document states the owner and description of the property. The seller has to also provide a map describing the size and its location. You also request a recent “Certificado de Registracion” which is similar to a title search in Canada or US. This document will indicate if there are any leans or other legal complications against the property. All documents must be originals and have the signatures and stamps from the registration office. At the end of this step, you’ve confirmed the owner of the property and its location, and you’ve determined there are no existing leans or other legal complications against the property.

Step 2: Bill of sale & Taxes

The seller and the purchaser, or representative agent, go to the nearest city and obtain a form for a “bill of sale”. This document lists the seller and buyer and is basically used for sales tax purposes. It is a common practice to declare the sale price of the property at a lesser price than the amount paid. This is for two purposes, first, keeping the sales tax low and second, trying to keep it less than the $20,000 for tax exempt status (There are never property taxes on property valued under this amount, Never!). You will receive a receipt and a copy of the form. Then you’re off to the nearest Notary Public with your representative agent and the seller to transfer the title of the property.

Step 3: Title Transfer 

First, a note about Notary Publics in Dominican Republic  and elsewhere in the region. A Notary Public in DR does a lot more, is granted far more responsibility than a Notary Public in Canada, Spain or  US.  A Notary Public in DR, and also in other Latin American countries, is a high ranking official. In  Venezuela, Ecuador, Colombia, Peru  for example, only lawyers can be Notary Publics. Government run Notary Publics have the final authority in regards to any legal transactions. Whether it be buying property or making a legal contract, they do it all. 

The old title, all previous land documents, and the new tax form are presented to the Notary with a minimal fee. The Notary in turn takes all the appropriate data, including that of the new owner, and types up the new title with the new owner’s name, the seller, a description of the property, the location of the property, any special terms that may apply, etc. These documents then go into the Chief Notary’s office for final approval.

Step 4: Transfer of Funds for Purchase

Once the Chief Notary has signed these documents, it is then and only then that funds transfer hands. Payment is preferable by a certified check on a bank in DR, the one you’ve wire transferred money to. If a third party is involved then any commission or service charge in the form of a certified check are also to be made. Same as in Canada.

I’ve also known buyers to complete steps 1, 2, and 3 before wire transferring the funds for purchase. That involves putting up a deposit, usually about 3% of the sale price, and the buyer and seller signing a document stating that the balance is due once steps 1, 2, and 3 have been completed. In many cases, the buyer can authorize the bank that receives the wire transfer to disperse the balance once these steps have been satisfactorily met. You can bet the bank will help you double check all is in order before turning over the balance in Step 4. 

Step 5: The National Registry. 

 Direccion nacional de  CatastroNothing gets done or completed in the Dominican Republic until it is submitted to the National Registry and duly recorded. This is true whether it be a birth, death, marriage, divorce or buying property (Catastro) . This process normally takes several weeks but can be speeded up by having the documents hand delivered and presented to the main office of National Registry in Santo Domingo City. Once you have the title in your hands with all the appropriate signatures and stamps,  it is yours!

Congratulations! You now own a piece of paradise at an affordable price in a place where it costs very little to live like a King. Don’t sell it to the first gringo who offers you twice what you paid. Keep it for at least a few years, until prices go through the roof. 

May I say in closing, that Dominican Republic  is an excellent place to retire. DR’s government has not only passed special visa legislation but generous benefits as incentive to potential retirees. The government realizes that the economic trickle down effect of retirees from North America out weighs that of only the potential tourism.  All these great incentives are perhaps the best in the  countries I have traveled.  Please feel free to contact me directly if you require more information and assistance as we have our lawyer at your services in DR for real state issues.

Popular destinations in Dominican Republic Real State

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