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  1. #1
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    Default Opening a hostel

    I am thinking of moving to Punta Cana later this year to open a hostel. I'll need to enlist a lawyer to help me. I'm worried about finding property to use. Is it difficult to convert a house into a business?

    Thanks!

  2. #2
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    Having done this myself, my main tip is ONLY use a Dominican Architect, and one who works locally and has good connections with the Ayuntamiento. I made the mistake of using a foreign architect who spoke English, and I've had a nightmare with permissions ever since because he didn't have the right relationships in place. Secondly, before you buy the property, get your architect to talk to the Ayuntamiento and see whether they are going to be likely to give permission for change of use (Uso de Suelo). Important to do this before you buy, not after. There is so much for sale in Dom Rep, it's always a buyer's market and even if you wait 9 months or a year before you buy, chances are that the property will still be on the market. Final tip, study your market very very carefully. There are a lot of smaller hotels in Punta Cana which are seriously struggling. The big resorts are doing well, but the smaller ones are seriously finding it hard to compete with AirBnB. There are a lot of costs involved in running a hotel or hostel here and you must factor in the taxes that you will have to pay as it's very hard to run any sort of business without paying them these days.

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  4. #3
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    Quote Originally Posted by TropicalPaul View Post
    Having done this myself, my main tip is ONLY use a Dominican Architect, and one who works locally and has good connections with the Ayuntamiento. I made the mistake of using a foreign architect who spoke English, and I've had a nightmare with permissions ever since because he didn't have the right relationships in place. Secondly, before you buy the property, get your architect to talk to the Ayuntamiento and see whether they are going to be likely to give permission for change of use (Uso de Suelo). Important to do this before you buy, not after. There is so much for sale in Dom Rep, it's always a buyer's market and even if you wait 9 months or a year before you buy, chances are that the property will still be on the market. Final tip, study your market very very carefully. There are a lot of smaller hotels in Punta Cana which are seriously struggling. The big resorts are doing well, but the smaller ones are seriously finding it hard to compete with AirBnB. There are a lot of costs involved in running a hotel or hostel here and you must factor in the taxes that you will have to pay as it's very hard to run any sort of business without paying them these days.
    Thanks! I think I'm going to rent, not buy. Do you run a hostel or a small hotel? I'm going to have a private room or two which I'll list on AirBnB. If I don't alter the property, I don't need an architect, correct?

  5. #4
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    Quote Originally Posted by ed1992 View Post
    Thanks! I think I'm going to rent, not buy. Do you run a hostel or a small hotel? I'm going to have a private room or two which I'll list on AirBnB. If I don't alter the property, I don't need an architect, correct?
    I own a hotel. If you are going to rent rooms in your own home then at this stage you don't need permission to do this and you won't need an architect. You need to think about getting residency if you are intending to stay more than 1 month at a time. Some on here will say this isn't necessary, but if you are running a business then you will find it hard to do so without having a cedula. It really comes down to the scale of your operation. If you are renting a place with four bedrooms and rent out a couple to other people on AirBnB then you'll be under the radar and you are probably best advised not to bother to get permission. If you are going to put a sign up and have five or six rooms, cook breakfast, employ staff, and start listing on sites like Hotels.com or Booking.com then you're running a business and it's a different ball game - you will need residency, you will need your business to be registered, pay taxes, and have the proper permissions.

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  7. #5
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    Quote Originally Posted by TropicalPaul View Post
    I own a hotel. If you are going to rent rooms in your own home then at this stage you don't need permission to do this and you won't need an architect. You need to think about getting residency if you are intending to stay more than 1 month at a time. Some on here will say this isn't necessary, but if you are running a business then you will find it hard to do so without having a cedula. It really comes down to the scale of your operation. If you are renting a place with four bedrooms and rent out a couple to other people on AirBnB then you'll be under the radar and you are probably best advised not to bother to get permission. If you are going to put a sign up and have five or six rooms, cook breakfast, employ staff, and start listing on sites like Hotels.com or Booking.com then you're running a business and it's a different ball game - you will need residency, you will need your business to be registered, pay taxes, and have the proper permissions.
    I plan on getting residency. I heard I don't need it to own a business, but I must have it to work in the business. So to get permission do I get a lawyer?

  8. #6
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    Quote Originally Posted by ed1992 View Post
    I plan on getting residency. I heard I don't need it to own a business, but I must have it to work in the business. So to get permission do I get a lawyer?
    What permission are you talking about? If you are going to set up a business, then you definitely need a lawyer to get the business registered, and you definitely need an architect if you want to do something like change the use on a building that you are renting from residential to commercial. I think it is right that only the owner of the building can change its use - so you will need to discuss this with the owner if you rent the building as they may not want their house to be classed as a business forever more.

    If you do set up a business and intend to pay taxes and employ people, trust me it is a very complicated process and you need to take time to understand how it all works.

  9. #7
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    Hey I sent you a PM

  10. #8
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    Quote Originally Posted by ed1992 View Post
    I am thinking of moving to Punta Cana later this year to open a hostel. I'll need to enlist a lawyer to help me. I'm worried about finding property to use. Is it difficult to convert a house into a business?

    Thanks!

    Read through this, and his blog is linked in the thread.

    https://dr1.com/forums/showthread.ph...dventure-in-DR




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  11. #9
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    An area of economic opportunity in PC/Bavaro is low-cost accommodation aimed at the local working population.
    Moderator East Coast Forum


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  12. #10
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    Quote Originally Posted by Chirimoya View Post
    An area of economic opportunity in PC/Bavaro is low-cost accommodation aimed at the local working population.
    Yup, you got that right. Done properly that would be a gold mine.

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