Investment

The smile of the Dominicans, the friendly atmosphere and the legendary warmth towards tourists have made the Dominican Republic a world renowned tourist destination, receiving more than three million tourists a year.

Las Terrenas with its 15 miles of pristine white sandy beaches has become an important investment center due to the ease with which foreigners can invest, the international media coverage, tax advantages and the many major projects currently being realized such as:

-The international airport at El Catey (40 minutes from Las Terrenas). Operational since 2007.

-A motorway joining Las Terrenas to the capital city (Santo Domingo). Operational since early 2008.

-Several Spas and sophisticated beach clubs.

- Two championship golf courses, one in Las Terrenas, the other near El Limon.

- An array of international restaurants to please all pallets.

- Several supermarkets offering American, English, French and Italian products as well as fresh local produce.

The investment potential of "Ocean Breeze" is based on currently available information as detailed below.

The houses on Ocean Breeze are currently appreciating in value by more than 25% per annum however the calculations below assume only 12% per annum for five years then reducing to 9%.

Some factors have not been taken into account in our figures, as they are extremely variable and depend on how the owner will operate the house rental.

A) House and pool cleaning

B) General maintenance costs repainting etc

C) Insurance

However we have not mentioned the expected value of a property such as this villa which, in seven years time, would be in the order of $1,000,000. The basis of this assumption is calculated at 12% per annum for five years reducing to 9% thereafter. Based on re-sale prices of houses on Ocean Breeze, we are actually seeing at least a 25% per annum increase in value over the first three years.

Effectively this asset, a villa with an anticipated value of $1,350,000.00 after ten years, would have been paid for by the rental income over the ten year period. Therefore for an initial investment of $500,000.00, which you would get back from the rental income over ten years, you would have a return of over $1,350,000.00 in the next ten years largely tax free. Plus the use of a luxury holiday home for you and your family.

Note

The rental income will be affected if you take up all the major holiday weeks yourselves.

 

  • Rental Return Against Purchase
  • Capital Appreciation
  Example House Cost Less annual net rental income Balance carried forward
Year 1
500000 $
30000 $
470000 $
Year 2
470000 $
30000 $
440000 $
Year 3
440000 $
45000 $
395000 $
Year 4
395000 $
45000 $
350000 $
Year 5
350000 $
50000 $
300000 $
Year 6
300000 $
50000 $
250000 $
Year 7
250000 $
60000 $
190000 $
Year 8
190000 $
60000 $
130000 $
Year 9
130000 $
70000 $
60000 $
Year 10
60000 $
70000 $
0 $
Example House Cost Less annual net rental income Balance carried forward
Year 1
500000 $
60000 $
560000 $
Year 2
560000 $
67200 $
627200 $
Year 3
627200 $
75264 $
702464 $
12%
Year 4
702464 $
84296 $
786760 $
Year 5
786760 $
94411 $
881171 $
Year 6
881171 $
79305 $
960476 $
Year 7
960476 $
86443 $
1046919 $
Year 8
1046919 $
94223 $
1141142 $
9%
Year 9
1141142 $
102703 $
1243845 $
Year 10
1243845 $
111946 $
1355791 $