Buying Real Estate in Dominican Republic
If you are considering buying real estate in the Dominican Republic, be sure to hire a lawyer, and do not sign any contracts without investigation. The Dominican real estate system is inspired by those of France and Spain, as it had been colonized by both those countries. It has also been influenced by some customs of the United States.
Attorneys and Real Estate Agents
You should hire a lawyer to give you legal advice, and to assist you with the process of buying real estate in the Dominican Republic. The Domican Republic has a reputation for unofficialized and unregulated matters in its real estate market, so you should have a lawyer to help investigate factors for your best interest.
You will also work with a notary. You will have to sign necessary documents in presence of a notary. They also do some research and check on certain aspects of the property before it is transferred into your name.
A real estate agent can be helpful, but is not necessary.
Rules, Regulations and Restrictions
There are no restrictions against the foreign ownership of property in the Dominican Republic. You are subject to the same laws as the local citizens.
General Process
First, you should settle on a property, and make an offer to the seller. Then a Reservation Contract should be drawn up, which is a contract of sale. You will put down a deposit, and the property will be off the market for a few weeks. Your lawyer should then review the contract, and do further investigations to make sure everything is legally sound.
After you sign the Reservation Contract, you must have some research arranged on your property. It must be determined that the seller has the title of the property and right to sell it; that it has appropriate zoning consents; all of the contracts are legal and sound. The property should be surveyed, and all of the taxes by the seller must be paid. Your lawyer can help you with this process.
Then a preliminary contract should be drawn up, in which you will sign it and then put down a full deposit. It could be an Offer to Buy, a formal contract that should be drawn up by your lawyer or a qualified estate agent. This is an official document that legally binds you to the offer. The other contract is a Preliminary/Promissory Purchase Contract, which is a legally binding contract to the property (these are both options). If you sign this contract, the next contract will be a formal contract of sale. You will then put down a 10% deposit.
Be sure your lawyer fully investigates whatever contract you sign. Offer to Buy is considered a safe option. Do not sign a contract at a very early stage without anything being researched and checked.
You should also apply for a tax number and set up a Dominican bank account. If you are going to set up a mortgage with a Domincan bank, then you will need approval by a lender. Your lawyer can help you with this process.
If everything clears, you will need to sign the Final Contract of Sale/Title Deed, in the presence of the notary. The notary is also the one who prepares this document. You will need to pay the rest of the balance to the seller, as well as necessary fees and taxes. You must register your new property with the Land Registry of the Dominican Republic.