Thought of buying a hotel in Cabarete

gurfrip

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Aug 1, 2003
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about 8 months ago.

Started researching the climate and have been very turned off about the economic direction of the DR.

It apears that it is going from bad, to worse and with recent Central Bank actions my concern is an economic collapse.

I don't have a crystal ball does anyone have advice on what to look for when Property Value is finding a Bottom?

gurfrip
 

ltsnyder

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Jun 4, 2003
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A stupid response . . .

Don't take this the wrong way, I just have no idea about where the realistate market is going. Are you saying that the price of land is going down? Is this a generally accepted belief, that the values are going down, and wondering where the bottom is, as a result of the financial situation in the DR?

-Lee
 

Hillbilly

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Jan 1, 2002
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You had better consult

Jazzcom, our resident guru on Real Estate. He has purchased a condo and a lot and Lord Only Knows What Else!

He has said that he thinks that the bottom or near bottom is at hand and this is a good time to move into the market.

Talk to him.

HB
 

Escott

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Jan 14, 2002
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I am NO expert especially regarding the micro economy that takes place in the Dominican Republic. You have a strange phenonom of good growth vs. government screwing up the economy faster than superman can fly around Eddys Bar.

Best time to buy R.E. historically is when things are at their worst. I can't think of a damn thing that can be worse here at the moment. When I compared prices to Costa Rica, Mexico and other like places the DR had better buys hands down! To my amazement the DR has much better infrastructure than Costa Rica, Panama, Ecuador and many other places I have been to by FAR.

If they can get a responsible government here that gives a shit about the people this place is prepared to take off like a Rocket Ship. The only question is "Can they" which I have my doubts. Corruption and graft runs rampant here and the people allow it so I don't know if it will ever change. They will protest Iraq but they won't do a damn thing to change their evil ways which is another of the abstractions I think about.

I am buying in the DR. Made 2 real estate purchases in the last 3 months, made 3 offers in the last 2 weeks. Plan on making 3-5 more offers next week. My friends are buying also here. One friend came to terms on a Condo and a building lot last week who I helped a little. Should you buy? You will have to figure that out for yourself.

Scott
 

GirlieGirl

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Jun 19, 2003
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said well...

scott said it all... if that does not answer your questions than nobody will...
 

lurker

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Apr 24, 2003
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bottomfeeding in morally and financially bankrupt republicas is dangerous and JUST PLAIN DUMB.

time will tell .........
 

KenoshaChris

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It takes three flights in one day to get to anywhere I really want to be in Costa Rica. Mexico is too expensive. The Puerto la Cruz area of Venezuela is one of my favorite places in the world but again, three flights in one day, leaving here at six in the morning and getting there at nine at night. They can have Florida and I just don't like Puerto Rico that much. What I have on the north coast would cost me at least twice as much in any of these places and I could imagine what the price tag would be if it was in the Virgin Islands. My sense is that if the real estate market isn't at bottom, then its very close.
 

lurker

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Apr 24, 2003
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why

do u think it has bottommed?

stellar economy?
brilliant minds in government?
excellent & unlimited credit (@ 3% month)?
bright outlooks?

what if the house of cards falls,
what happens to real estate prices?

bottom should be after ALL the major problemos are fixed.
just gambling at this point. vegas is more fun.
 

ltsnyder

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Jun 4, 2003
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I don't think DR Realestate prices have bottomed out yet.

The main problem is the financial collapse in the DR, I don't think it has hit rock bottom yet. The IMF is seeking to impose restrictions on the bail out loan that would curb spending. This might easily mean that infrastructure will suffer over the long run, roads could have more pot-holes (notice I said more), new water aquaducts and other projects could be put on hold, and temporary blackouts as some sort of compromise between having prices too high or ongoing brown outs hardly satisfies anyone.

If land was a safe bet, people seeking to pull there money out of cash and put it into capital (to shelter themselves from recent hyper-inflation) would be buying up land like crazy (and I don't see that happening). The other shoe of the collapse (that has not fallen yet) is that chances are that taxes will change and you know who is best able to pay the financial collapse, people who are expatriates and rich dominicans, I'm sure there will be loopholes to protect the powers that be, but the taxes will probable be there in the future and you know what that will do to land prices. If I told you the money will be transfered from the innocent to the currupt, I don't think any one would bat an eye at that statement, they would probably think "but of course, but get to the point". DR is a poor nation and 2.5 billion is a huge debit and any IMF deal will only increase the total debit (but spread it over more year, a kind of reverse IV, bleed em slow and long). If you assume out of 8 million people only about 20% of families have any significant wealth and that only 1 in 3 in any family is a bread winner, that makes a 2.5billion USD/ (8mil * .2 *.33 ) or a $4735 USD debit for those in the DR that have something to give.

-Lee

PS: And what other evidence do we have that we have not hit rock bottom? The issuing of government bonds to pull money out of circulation only seemed to tempoarily stalled (not stopped) devaluation. Articles seemed to hint that the issuance was done possibly to stabilize with out the IMF, but again while it might stabalize now , this action is increasing the long term debit load, and also encouraging the government to allow inflation to continue (less true value when the bonds mature).
 

Escott

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Jan 14, 2002
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KenoshaChris said:
It takes three flights in one day to get to anywhere I really want to be in Costa Rica. Mexico is too expensive. The Puerto la Cruz area of Venezuela is one of my favorite places in the world but again, three flights in one day, leaving here at six in the morning and getting there at nine at night. They can have Florida and I just don't like Puerto Rico that much. What I have on the north coast would cost me at least twice as much in any of these places and I could imagine what the price tag would be if it was in the Virgin Islands. My sense is that if the real estate market isn't at bottom, then its very close.
The thing I love most about Puerto la Cruz is the restaurants and ceasar salads. It seems as if the restaurants compete on who makes the best!

I enjoy Margarita Island also.

If you go to Costa Rica, you need to fly into San Jose which is not near the water, stay the night, drive a back breaking 2.5-4 hours to hit an area I would care to live in and pay 3x the money for a condo you would pay in Sosua.

I take a direct flight to the DR from NYC in 3 hours and 20 minutes (eat your heart out Chris) as opposed to 2 days of travel to Costa Rica or Boquete Panama. Mexico just plain sucks. What a dead country.

Again, the best time to purchase property is when things appear to be at their worst. For the life of me I can't see this place getting any worse than it is now. If the money from the IMF comes through you will see a difference in 12 months in the economy once there is some sense of things stabilizing.

One thing that most people fail to keep in mind is that the DR has a much better infrastructure than any other "LIKE" place I have been to. Better roads, 6-7 international airports that put you close to most places you would care to stay and a President that is beyond reproach in regards to morals. (ok so one exageration:)).

One of the lots I put an offer on but was turned down on was just sold for 2x what I offered and paid for what I consider to be a nicer lot with a much nicer view.

The least expensive condo available NOW in my complex is listed for 69k. The second least is asking 85-90k and the next is 100k. Out of 18 condos in the complex 5 have sold in the last 6 weeks. I see prices starting to firm and move up regardless of what anyone may say.

I put up a website to rent my condo when I am not there. It has been up for about 6-7 weeks and I have rented about 12 weeks from it already. I just rented my condo and another condo in my complex out for approx 10 days. I also have it rented out for February and possibly another in the complex for Feb as well. There appears to be a high demand since I have rented out approx twice as many weeks out as weeks in existance of the website.

If this is what some consider a crash, I welcome more of it.

While I am just finishing a 25 year career in Real Estate in NYS and retiring on a high note since the prices have been in an upward spiral for 2 years now I do not have the same urge to get in as hot and heavy as I had been previously. I plan on just diddling with R.E. here because it is in my blood. I won't do anything that will make it feel like a job again.

I have lived through the ups and downs of real estate. One thing I would like to mention is that when prices were going down my rental prices were going up. Never for one moment was I NOT making a lot of money. For those that don't know what the point of R.E. is I have the short answer... The point is to make money and that is it. I am getting a good return already on my investments in the DR. End of story.

When I decided to sell the prices were up. Retirement just came a little earlier for me because the market was driven higher.

Hey just my 2 centavos, and you know what opinions are like, right?

What we have here in this thread is just like what we have in every other real estate thread. Those of us that are buying and believe in what we are doing or just too damn proud to ever admit we can be making a mistake and those that can't afford to get into it or just too possessed by the ugly demons:) Time will ultimately tell.

Escott
 

Escott

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Re: why

lurker said:
do u think it has bottommed?

stellar economy?
brilliant minds in government?
excellent & unlimited credit (@ 3% month)?
bright outlooks?

what if the house of cards falls,
what happens to real estate prices?

bottom should be after ALL the major problemos are fixed.
just gambling at this point. vegas is more fun.
I think the economy is at the worst point since I have been here. I think the government needs to change. I love the high interest rates and think that it can't get worse.

The house of cards has fallen. Why in the world would you think the IMF is here? What can possibly happen to real estate prices? You think they will pay you to take it off their hands? They will NEVER fix "ALL" the problems here or anywhere else. Vegas in not nearly as much fun as the DR. Vegas if for suckers.
 

ltsnyder

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Jun 4, 2003
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Who knows . . . . .

Escott, most of my comments were directed towards long term effects of the collapse. I don't think your observations contradict what I said. I mean if I was a forigner, I'd buy in DR at least from a superficial standpoint, I mean any infrastructure, taxes and general population poverty issues are months away. All I would see at ths moment is

1) Good infrastructure.
2) Good prices (due to devaluation).
3) What looks like a poor but self sufficient population.
4) and of course next to no taxes.

But this collapse is far from over, and we have not seen the last of it. I might just eat my words, I can't figure out what will happen next. I mean the IMF might stabilize the situation and this might only result in a 1 - 2 year recession. But when you hear the representatives of the government stating they are going to crack heads if there is protest, and when you hear about the banks putting new rules in place to slow the flow of money, and media stations being warned to watch what they say. . . . I worry.

-Lee
 

XanaduRanch

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Sep 15, 2002
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lurker said:
bottomfeeding is for suckers

Where did you learn economics? The 'East German School of Capitalist Pig Real-Estate Brokers'? Give it a rest!

No matter what commodity you trade in you buy low and sell high. Because if you buy high and sell low then you are the 'bottom feeder'. Whatever that is.

Tom
(aka XR ...consulting his Socialist to English translation dictionary)
 

MrMike

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Mar 2, 2003
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Hang out in Cabarete alot and...

I have been pleased to see business picking up there after a few really bad years when most of my favorite bars went under, (New Wave and Tiki)

The consensus seems to be that all the businesses between what used to be "New Wave" (Now Jose O'Shay's Irish Bach Pub) and Vela get most of the business in the area, and the rest just kind of get "leftovers", being too far out of the way.

If you do buy a hotel in Cabarete let me know and I will stay there when I'm in town, I'm getting sick of all the attitude my wife gets in the hotels down there, everybody thinking she's a hooker just cause she's a black Dominican with a white Gringo.