Last year 2005′s round for banks repossessing real estate had turned down slowly. But banks started to regain their activity in repossessing real estates in the year 2006. In fact, a lender further said that this year may be another successful turn for real estate investors.You must hire a professional real state agent or broker if you are planning to buy a bank repossessed real estate. However, do not loose hope if you are hearing bad rumors from the other agents about these bank repossessed real estates. They may tell you that it is not that easy and practical to invest on these types of real estates. Mind you, there are many brokers or real estate agents. Don’t limit yourself to one agent.On the other side, you might be thinking of spending few dollars to listing services. These listing services may send to you the list of bank repossessed real estates through mail. Don’t be blinded by these services. It will just be a waste of money. The truth is, the real estates might have been sold the moment the mail listing arrives.Also, you might see the schedules of various banks with specializations in bargaining real estates. Most banks bid their repossessed real estates at low prices. However, there are some policies, conditions and availabilities that you need to confirm. These have something to do with the reselling and financing of these banks’ real estate owned (REO) properties.Many banks repossess real estates just because they want to, while others lend them. Ask a favor to give you in-house terms to have good financing. Make a visit to your target bank and ask any bank authority for information on how they market their repossessed real estates.Many of these banks will give their website where you can find the listing of their repossessed real estates. Also, establish rapport with your broker or real estate agent so he or she may inform you immediately whenever a new repossessed real estate is added on the listing.Repossessed real estates are good opportunities for you if you are a first time real estate investor. But you or your broker must make the first move to get in touch with the bank to show that you are really interested to their real estate. Have your final decision before you contact the bank.These days, brokers are using the Multiple Listing Service (MLS) to check the new and unsold real estates. So you or your broker must check the MLS regularly. You may call the listing agent if you or your broker found a new item on the list. But bear in mind that bargaining with the bank which owns the repossessed real estate may weaken if there’s an involved listing agent.However, you have to make practical moves to communicate directly to the foreclosing bank if there is no listing agent involve. Be aware that selling real estates is not the main business of banks. So you have to do your thing on how to find the department or authority in-charge to the repossessed real estates from the MLS. When you’ve found the right department, be patient enough until your transaction is successfully accomplished.Bank repossessed real estates can be good sources and nice starting points of your investment. Investing on these can be your career, too.
December 2005 was a different time in Punta Cana and the Dominican Republic. At that time, the Punta Cana and Dominican Republic real estate markets were experiencing what some would consider atypical growth.Demand was far greater than the supply, a thriving influx of international buyers, lowest interest rates in the history of the Dominican real estate market, both US dollars and Dominican pesos, national and international economic stability, high rental income, mega tourism developments sprouting like wild flowers, international financing, bonds were issued, free favorable press, and tourism numbers at an all time high. Buyers were looking for anyone developing or selling near the tourism hubs of the island.Those were the good ol’ times! It was about being in the right place at the right time.Many considered that there was no reason for the Punta Cana and Dominican Republic not to be known as the “Home of the World”; however, it was also emphasized that it was imperative for the real estate industry to take some necessary measures in order for development to continue in an organized fashion.Fast forward to end of 2008. Today, the real estate industry is also experiencing a completely atypical situation, which unfortunately can’t be called positive, but can’t be called negative either. It is going back to what is considered a normal, standardized real estate market. Supply and demand more in balance than in years past.Any real estate developer can tell you that it is not normal to sell an entire development in less than a year. Normal would be for at least two years to sell a small to medium size development and perhaps more time on the larger more ambitious developments within closed gated communities. Of course, it is normal to think that things are cooling off after coming out of the “BOOM” we have been experiencing for the past few years. Instead of cooling off, I would call it business as usual, going back to normal, supply and demand in equilibrium!At the moment it is important to sit down and analyze the “foundation” of our market as we take the necessary corrective measures based on lessons learned.First, let’s look at the foundation. Why the Dominican Republic? Why Punta Cana? What makes us so special? Why are Punta Cana and the Dominican Republic relevant investment markets? Why alternatives for second home buyers? Why should it be considered ideal places for retirement?Excellent geographical location that allows us to have year round tropical climate. The cold countries remain cool. We continue to have some of the best white sand beaches and turquoise colored crystal clear waters Legal Framework – No Restrictions for Foreigners, Equal Ownership Rights Economic Stability Social Stability Personal Safety, Dominican Republic crime rates are low in comparison to other Caribbean Neighbors Modern and adequate transportation and telecommunications infrastructure (airports, seaports, highways, telephone, internet). There is room for improvement, but we are headed in the right direction. Extensive complementary offer (water sports, golf, restaurants, grocery stores, resorts, casinos) Ecotourism The Dominican People – Always friendly and hospitable!Beyond these points, we must recognize that there has been encouragement for foreign investment by the local government. Foreign direct investment more than doubled in 2008, according to statistics from the Center for Exports and Investment (CEI-RD). Investment in 2008 totaled US$2.35 billion, for a 55.1% growth from 2007.Just last week, December 12, 2008, Dominican Republic President Leonel Fernandez broke ground for US$1.4 billion dollars VistaCana Resort & Country Club in Punta Cana. President Fernandez and the project’s main promoter, Salvador Termín headed the groundbreaking ceremony, with Tourism minister Francisco Javier Garcia also present. Mr. Termin spoke about the world crisis we are experiencing, and emphasized that they have prepared themselves for the crisis. “We have decided to continue to invest, since that is what we do. We believe in the Dominican Republic since it continues to be a safe place to invest with lower risks in comparison to other places around the world”.Venezuelan investors began construction of the tourist complex on six million square meters of land. The complex will have 6,000 residences, a 100 room business hotel, a 27-hole golf course and a 180,000 square meter artificial lake integrated to the beach area, and built at a cost of arond US$1.4 billion dollars. This will bring 20,000 new jobs to Punta Cana when concluded.President Fernandez said “this development is proof that within the global crisis that we live today, foreign companies like the developers of VistaCana, testify that the Dominican Republic still has economic and financial security for world wide investors, developers and end users alike. 1,500 homes have been purchased by an investment fund for North Americans retirees out of Washington D.C. plus more than 200 units sold to individuals.” President Fernandez added that in addition to VistaCana, just last week he was in La Romana for the groundbreaking event for the mega development Playa Nueva La Romana by Spain’s Grupo Piñero, owners of the Gran Bahia Principe Resorts. This represents US$2.5 billion dollars in foreign investment. In addition, in the coming days, President Fernandez will be alongside the Prince of Monaco, in the groundbreaking ceremony for Punta Perla located in Cabeza de Toro near Punta Cana, with another US$1.6 billion dollars in foreign investment from the U.K.That is a total of US$5.5 billion dollars of foreign investment in the month of December alone for the real estate industry. These are big numbers from world wide known companies and investors that have very deep pockets to conduct feasibility and market studies. They have decided that the Dominican Republic is the safest place with the best investment opportunities in the Caribbean and perhaps the western hemisphere.In addition to encouraging foreign investment, local government has achieved:Enactment of new laws that attract retirees and baby boomers. Incentive for pensioners and annuitants Reduction of taxes related to real estate Firm decision to improve communication infrastructure to the tourist areas Efficient and better system for the approval of new developments Public sector working hand in hand with private sector to help develop joint activities aimed at strengthening the real estate industry.We can say that without a doubt we have a solid foundation for sustained growth in the real estate industry; however, no longer is location, location, location the most important part of deciding where to buy real estate in the Dominican Republic. Investors and buyers alike are looking for security, security, security.First and foremost, the security and safety of their investment. Investors and buyers understand that property acquired in the Dominican Republic is not going to suffer the effects of devaluation that other world markets have experienced. This is for several reasons: Historically in the Dominican Republic property values have always tended to go up and never down The Dominican Republic does not have a secondary market for the marketing of securities where good and bad mortgages come together. We all now about the USA mortgage mess that has property values on a downward spiral. Given our past experience with the banking system, the mortgages could be considered “healthy”, meaning that the market value of the property exceeds the value of mortgage.Second, security of ownership rights, of course. Foreign buyers are guaranteed the same rights as those available to Dominican buyers.Third, security of return on your investment. Real estate-tourism products have the potential to generate revenue because they can be rented to employees in the tourism sector and also because each day is further developed the so-called “residential tourism.” Refers to those tourists who prefer to rent a villa or apartment to take a more familiar experience and learn more about the area of access.What do we need to do as industry leaders and real estate professionals?Find end users: Avoid clients who seek an immediate capital gain. This refers to buyers/flippers who have neither the intention nor the ability to close on the real estate transaction. The best way is to ask for a significant down payment that the buyer/flipper will lose if decides to walk away from the real estate transaction. Pre Qualify Buyers: Provide the buyers with the proper forms and contact information for pre qualification with local banks. This will prevent from future headaches in the future. Perform target marketing plans for buyers and investors required for the particular development. Carry out strategic alliances with government institutions to promote the Dominican Republic as a tourist destination, not just a real estate destination. Join forces with high profile tourism developments for further commercialization of the Dominican Republic. Be aggressive in marketing products in more than one way: create alliances with international real estate agencies, non traditional advertising, speaking engagements, eMarketing, and so on.The most important thing is to understand that we have a good product. We are in a cycle of the market where change is inevitable and considered normal. There is no need to panic. Punta Cana and the Domincan Republic have become world destinations. We still have many great years of selling Punta Cana real estate and Dominican Republic real estate. We just need to roll up our sleeves, continue to work with ethics, be honest, creative and pro-active. We have no doubt, sooner or later Punta Cana and the Dominican Republic are destined to become the HOME OF THE WORLD!We expect many good things to come in 2009 and are very positive that we will make a difference and separate ourselves from the rest of the crowd. With the alliances that we are forming with real estate agencies from around the world, we will definitely position ourselves as the #1 real estate company for developers, buyers, sellers and investors that are looking for the right company to assist with buying or selling real estate in Punta Cana and the Dominican Republic. Hope we can be of assistance in 2009! We will help you find the right home in Paradise!