property price madness

mrmagic

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Nov 25, 2003
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ive just finished scanning the property prices of homes within the real estate section of DR1 and numerous other DR real estate sites and all i have to say is if YOU are considering paying these prices...you are MAD!!!!!!The real estate agents have seen you coming!.
I personally live not 4 minutes away from a major north coast tourist area (cabarete) where homes routinely go for 250-300kus and up, and condos are priced from 130k and upwards. These prices are insane.....i know of land being sold for $25us a metre (1000mtr block)=25k....then all you have to do is locate a builder which i did and you can have a basic tiled/cinder block beach house built for 300-350sqmtr (i paid this) So if you want a 150sqmtr house its going to cost you
land=27k (including 2k legals/government costs approx)
house = (150metre *350)=52k
plus sanitation pit =1k
miscellaneous cost =allow 3k electrics
architect 4% of building cost =2k approx
total 85k approx

infact i personally paid the following amounts ;
125sq mtr home paid $45k to have it built
500sqmtr land on the beach 18k
legals/architect and miscellaneous additional costs 7k
total paid $70kk 4 mins from cabarete

All i had to do was organise the builder , architect and lawyer.
And yet for sale next to me are homes that have 60sqmetres more and are being sold for $450k.
if your thinking of coming to the the DR dont be fools...use your heads and build......its the cheapest way! Being asked to pay these amounts is bulls#$t there is so much land for sale in the DR priced below $35k come and buy some, build yourself and save yourself a s#$t load of money. I even heard recently from a real estate agent in the cabarete area that some real estae agent are adding 20%margins onto every house they sell .....20 friggin percent! And also dont believe the real estates when they quote that to build you have to pay $600us per metre either that is a crock of s#$t........$600us will be top quality according to my builder. If you just want a basic beach house $350metre will be ample
 
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gamana

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Apr 24, 2006
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supply and demand

As long as buyers pay for those prices, there is nothing nuts about it. it is called supply and demand and typically sets realistic prices up . Buyers always want to buy and sellers always want to sell. The rest are speculators either trying to buy low or sell high. If transactions happen in a marketplace then prices are rigth.

keep in mind that Real Estate markets need to be gauged on a micro level as far as land value and building real estate is not for everybody. Real Estate is a commodity for numerous individuals that are always willing to pay a premium for an end product.
 
G

gary short

Guest
gamana said:
As long as buyers pay for those prices, there is nothing nuts about it. it is called supply and demand and typically sets realistic prices up . Buyers always want to buy and sellers always want to sell. The rest are speculators either trying to buy low or sell high. If transactions happen in a marketplace then prices are rigth.

keep in mind that Real Estate markets need to be gauged on a micro level as far as land value and building real estate is not for everybody. Real Estate is a commodity for numerous individuals that are always willing to pay a premium for an end product.

Supply and demand........nope..........it's pure speculation.
 

gamana

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Apr 24, 2006
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so you think that the present RE market is only driven by pure speculation!!!!! That is scary. not a single buyer or seller willing to transact a piece of real estate for a non speculative reason???? i have seen those markets and trust me, if it was the case the market would be quite different. All RE markets are based on supply and demand with speculators representing a minute part of the market.

as an example:
an individual buying 2 km of beachfront property to hold is a speculator. he is controlling his own market hoping that adjacent property prices will rise by the principle of keeping a low supply so he can get his juicy gain or, market his property at a high price to possibly drive the market prices up.
Without disputing the fact that speculators are present in every market, they still represent a small percentage and they have little immediate effect on global property values. Supply and demand meet to set prices.

let's also be clear on the word speculator. Speculation is not appreciation.
as illustrated above, a speculator is an individual that is investing in RE just for profit. he will be looking to buy cheap and sell high and will take his time to achieve same.

Appreciation is inherent to RE. Anybody that buys RE in a good market could generate appreciation even if it is not their primary goal. every buyer will always monitor the appreciation of their homes or condos but it does not make them speculators

in any case, to go back to the original subject. a buyer paying more than the reproduction value of a property, meaning land plus cost to build, is perfectly normal and has nothing to do with speculation or craziness. Improvements have more than just hard costs involved. design, immediate occupancy, quality,... add value to the property beyond its hard cost.

great weekend to you all...
 

Tony Straight

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Dec 27, 2005
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Similar experience.......

A few years ago I was in Costa Rica, thinking about retiring there. I should have bought something since prices are way higher now. But --- on my last day there I was having breakfast and a guy at the next table said something about a new development on the next beach over. It was another of those "get a great deal on the pre-sale" thing. Assuming that anything would ever get built after all the lots are sold. His comment that really rang true to me was, "If you buy something near the beach at these prices, enjoy it for the rest of your life. When the time comes to sell, the only person who will be able to buy it will be another Gringo. The Ticos can't afford it."

Seems like that would be the problem here. Buy a nice house, but when you get old and need medical care and think maybe a move back to Canada or US or UK or wherever might be in order, who do you sell that house to?

Not really a reason to stay out of paradise, just a reason to keep your eyes wide open. Maybe also a reason to rent for a year or more, keeping your eyes out for a Gringo house that has been on the market for long enough that the seller is ready to do whatever it takes to move it.
 

Camden Tom

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Dec 1, 2002
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"If you buy something near the beach at these prices, enjoy it for the rest of your life. When the time comes to sell, the only person who will be able to buy it will be another Gringo. The Ticos can't afford it."
The north coast market is already a dollar based gringo market. Chances are, 25 years from now, there will still be prosperous gringos visiting and falling in love with the area and fantasizing about retiring in the tropics. Dominicans won't be your target market.
 

Rick Snyder

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Nov 19, 2003
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MrMagic is correct in his observations and line of thought. His recommendations are, I think and correct me if I am wrong, are for those that are thinking of coming to the DR to live on a permanent basis. Here in the DR you can get away from the astronomical prices if you do an extended search and work directly with the property owners. Of course this doesn’t necessarily apply to beach front property so if that is your desire as to where you want to live then you may have to pay the price.

I bought my property, 260 square meters, for $1,430 dollars ($5.50 per sq meter). I then built a house of 100 square meters on it at a total cost of about $8,000 dollars to include material and labor. This made the cost of my house, including land, at $100 dollars per sq meter or $80 dollars per sq meter just for the house. Having overseen the construction and having purchased the material myself I am very familiar with the prices of all aspects of the construction process This was 8 years ago and prices have risen since then but as I continue to stay on top of the process because of other things that I have constructed I can assure you that construction cost are presently at about $150 dollars per sq meter and anything you pay above that is pure profit for the builder. The only thing that may offset my calculations presently are the present prices for re-bar which are being jacked up due to the cohesion of the only two producers in the DR.

Let me also state that there were no permits or lawyers involved in my dealings other then those required for the title and registering of my land. Where you build will determine if you in fact need to go the route of acquiring building permits and the like.

Rick
 

johne

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Jun 28, 2003
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Need a bit more facts

Rick Snyder said:
MrMagic is correct in his observations and line of thought. His recommendations are, I think and correct me if I am wrong, are for those that are thinking of coming to the DR to live on a permanent basis. Here in the DR you can get away from the astronomical prices if you do an extended search and work directly with the property owners. Of course this doesn?t necessarily apply to beach front property so if that is your desire as to where you want to live then you may have to pay the price.

I bought my property, 260 square meters, for $1,430 dollars ($5.50 per sq meter). I then built a house of 100 square meters on it at a total cost of about $8,000 dollars to include material and labor. This made the cost of my house, including land, at $100 dollars per sq meter or $80 dollars per sq meter just for the house. Having overseen the construction and having purchased the material myself I am very familiar with the prices of all aspects of the construction process This was 8 years ago and prices have risen since then but as I continue to stay on top of the process because of other things that I have constructed I can assure you that construction cost are presently at about $150 dollars per sq meter and anything you pay above that is pure profit for the builder. The only thing that may offset my calculations presently are the present prices for re-bar which are being jacked up due to the cohesion of the only two producers in the DR.

Let me also state that there were no permits or lawyers involved in my dealings other then those required for the title and registering of my land. Where you build will determine if you in fact need to go the route of acquiring building permits and the like.

Rick

Rick-I think to better understand "building house cost" you must define what is included in your $150 m2 price. For example-what electrical system, power,
type of floors, roof, . What kind of windows? Any carpentry? Im sure you get my point so could you elaborate.
Thanks.
JOHN
 

mrmagic

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Nov 25, 2003
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Robert said:
Please list the land / lots for sale around Cabarete for 35K or less.

Thanks.


i didnt actually say i know of land around cabarete that is sold for 35k or less....i said in the DR

mrm
 

mrmagic

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Nov 25, 2003
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Robert said:
PM from MrMagic.

Sol Bonito has land $25k 1000 sq/metres.



unfortunately i will not be answering the PM messages from the responders to my above post......im sorry about this.
Why??i sent a PM to 'Robert' and he placed it on the public forum....thank you Robert! i thought PM's where meant to be private! So to those responders all i can say is im sorry i cant send you photos, details of where i live, and all of the other relatively personal stuff that i may consider sharing to help others out....as i dont want this information then placed on the public forum without my permission (like robert did!) .
But i will say this building is cheaper stay away from the real estates...they are price gouging!and they are crooks
 

Rick Snyder

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Nov 19, 2003
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John,
The price I paid included everything except for the screen door and the screens on the windows which I did myself. It also did not include the building and placement of the trusses and the laying of the corrugated metal roof as I did that also. It did not include any appliances and there was no carpentry done other then the door frames but this is because I didn’t want any excess wood due to the climate and my windows are metal. My kitchen counters are concrete. If I had it to do over again I would have a cement roof.

I wasn’t here when my house was wired and due to that I had to rewire it when I returned. I used street power with its associated blackouts until 2 years ago and bought a 3.2 kw generator. After spending a fortune on gas I bought an 3.5 inverter last year and that was the second best investment I’ve made here.

All houses that I’ve seem for sale here come basically stripped on the inside. The price to build a house of block in this country is cheap and labor is cheap also. I stand by my stated price of construction for a concrete block house in the DR. That price is for basic construction of a block house to include material and labor. Anything above that price is pure profit for the builder.

A lot of this was discussed and can be seen in the following threads;

http://www.dr1.com/forums/showthread.php?t=46165
http://www.dr1.com/forums/showthread.php?t=45915

Rick
 

johne

Silver
Jun 28, 2003
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OK--better explanation

Rick Snyder said:
John,
The price I paid included everything except for the screen door and the screens on the windows which I did myself. It also did not include the building and placement of the trusses and the laying of the corrugated metal roof as I did that also. It did not include any appliances and there was no carpentry done other then the door frames but this is because I didn?t want any excess wood due to the climate and my windows are metal. My kitchen counters are concrete. If I had it to do over again I would have a cement roof.

I wasn?t here when my house was wired and due to that I had to rewire it when I returned. I used street power with its associated blackouts until 2 years ago and bought a 3.2 kw generator. After spending a fortune on gas I bought an 3.5 inverter last year and that was the second best investment I?ve made here.

All houses that I?ve seem for sale here come basically stripped on the inside. The price to build a house of block in this country is cheap and labor is cheap also. I stand by my stated price of construction for a concrete block house in the DR. That price is for basic construction of a block house to include material and labor. Anything above that price is pure profit for the builder.

A lot of this was discussed and can be seen in the following threads;

http://www.dr1.com/forums/showthread.php?t=46165
http://www.dr1.com/forums/showthread.php?t=45915

Rick

I now understand your posting to mean a very basic construction of a block house stripped down to the bare concrete walls and nada mas.
Thanks for your reply.
JOHN