by Gareth
27. August 2011 01:44
While the property market in the U.S. and Europe becomes increasingly unstable, on the sandy beaches of the Dominican Republic Caribbean investment property has seldom looked more solid. With the second largest economy in the Caribbean, the financial recession experienced by much of the Western world just doesn’t seem to be affecting the Dominican Republic and there has never been a better time to look into Caribbean investment property in DR. In fact, over the last seven years, property in the Dominican Republic has seen a steady and constant rise in value.
The Dominican Republic property market is going from strength to strength for a number of reasons. Not only is property tax in the DR incredibly low, and in many cases non-existent, but the low cost of living, excellent value for money, location and climate in the DR make a Caribbean investment property an enticing prospect.
Another very good reason that Caribbean investment property has been unaffected by the recession is that banks in the Dominican Republic appraise properties for 70% of their value before they will grant a loan. This ensures that anyone likely to default on repayments is unable to even get a leg in the door. Equally, it is very rare to find residential mortgage backed securities in the Dominican Republic so, unlike the U.S., the sub-prime crunch has had little or no effect in DR.
Yet another factor in the success of the Caribbean property investment market in the Dominican Republic is the high interest rates. For upper-middle and upper class Dominicans this means that what in the U.S. or U.K. could be a 50 year mortgage, can be paid off in as little as 5 years in the Dominican Republic!
Meanwhile, the relative proximity of the Dominican Republic to the currently economically strong Canada means that many wealthy Canadians are choosing to invest in Caribbean investment property for second homes, holiday homes and retirement homes. This change has proven to be a significant economic boost in the Dominican Republic in recent years.
As you can see, it looks as if it has never been a better time to invest in Caribbean investment property in the Dominican Republic, and if the financial incentives don’t convince you the perfect climate, beautiful beaches and crystal waters probably will.