Questions & Answers About Living in The Dominican Republic

Question. Some of the comments from Dominicans living in New York or things they have told me are different from some of the more positive things I have read in terms of the reality of the current situation in the Dominican Republic (economy, housing, etc.). What is in fact the truth or why are some people reporting more negative things?
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Answer. Just as with many issues, it all depends upon with whom you talk to. If you ask a homeless guy on the street - How is it going? Chances are he will tell you - Not so good, or maybe something worse. If you ask a guy that just sold his business for US$3 Million in cash the same question, the answer will probably be - Great, Could not be Better.
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The problem with most immigrants you encounter in the US and Europe is that either they are poor or probably come from a lower skilled working class background. This is not meant to be a mean spirited or derogatory comment, but it is the truth. Wealthy Dominicans do not migrate to the US. What for? So they can pay higher taxes? They may visit New York or Miami to go shopping, or take the kids to Disney World - but they do not want to live there. Why should they? They have it pretty good where they are and they know it, both in terms of taxes, cost of living, lifestyle, etc. So, generally speaking, what kind of foreigners do you get seeking to live in the US, Canada or Europe? People that cannot get a job in their home country, or people that cannot seem to get ahead financially in their home country. Usually this means for the most part, people that are uneducated, people that come from more working class (lower levels of education) backgrounds, and also these are people that are willing to do the kinds of jobs in the US that Americans no longer want to do (like wash dishes in a restaurant, clean office buildings, etc., etc.). These are not Rhoades Scholars or people with Doctorate Degrees in Economics. Accordingly, their own point of reference, their own base of knowledge and the family and friends they still have back in their home country are probably going to be in the same socio-economic class as well.
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To illustrate this, the concerns of these people are that one-year ago, when they sent their usual monthly remittance of US$100 to their sister in the Dominican Republic, the sister changed the money at an exchange rate of 50 to 1, or RD$5,000 PESOS and she was thrilled accordingly. Today, that same US$100 is worth about RD$2,800 or almost half. So, today she is not so thrilled and she complains to her brother in New York that US$100 is not enough (and she wants him to send more money) because even though the Peso has doubled in value against the US Dollar, many of the prices in the supermarket have not been cut in half in tandem. All true. However, because this sister living in the Dominican Republic does not travel internationally and does not buy goods or products internationally, what she does not say is that her national currency, the Dominican Peso, buys almost double internationally than what it did one year ago. Stated another way, it is now 50 per-cent cheaper to travel to New York or Europe or 50 percent less expensive, in Peso terms, to buys products from abroad (because she can buy US$1 with just 28 Pesos today, where as US$1 cost 50 Pesos one year ago). In other words, the US Dollar lost half its value versus the Dominican Peso. Bad for the Dominican guy in New York sending money back home every month, Good for the guy living in the Dominican Republic that has Pesos (who maybe can now afford to take his kids to Disney-world this year accordingly). So, it all depends upon what side of the fence you are on, and whom you talk to or ask.
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In regards to the many middle class Americans and Europeans that have come to the Dominican Republic, the truth is that country is still less expensive and affords a much better lifestyle than many other Caribbean options. Housing especially, whereby in comparison to the Bahamas, Turks & Ciacos, Chile, Panama, etc. you get either more for your money in the Dominican Republic or you get a much larger or better home for less. How so? In Chile and Panama for example, you can find a brand new middle class apartment for about US$115,000 at the moment. However, the catch is, the size of that apartment for that price in Chile or Panama will be about 95 square meters (a shoe box to put it bluntly). In the Dominican Republic, you are buying a 140, 170 or 200 square meter apartment for the same money - to get square feet, multiply square meters by 10 to more or less get the square foot equivalent. Stated another way, a brand new 2,300 square foot home in a new residential housing community might cost about US$100,000 to US$140,000 in the Dominican Republic. That very same home will probably cost in excess of US$250,000 or more in many other Caribbean destinations.
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Question. What will the general cost of living be like if I live in the Dominican Republic?
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Answer. On the general cost of living issue, as we have already stated, while prices for some consumer items have come down slightly, many still have not. However, with that said, someone arriving from the United States or Europe will find many prices in line with what they are in the US or Europe (and in some cases less, such as local produce, fruits, vegetables, sugar, etc.). Cable television with about 90 channels (15 or so in English, including CNBC, CNN, and movie channels such as HBO, CINEMAX, etc.) will cost the equivalent of US$50 per month. Telephone with non-excessive long distance phone calls will probably cost about US$50 per month. The local telephone companies (Verizon and Tricom) offer a flat monthly bill of about US$35 with unlimited local calls (anything over that would be long distance or cellular phone calls that are billed at about 10 cents per minute - with local calls to other residential land lines basically free or unlimited). While the monthly bills for electricity have gone up over the past two years, they really are not too out of line with US rates. It is safe to say that if you have air-conditioning running every night in your bedroom, and your other standard appliances, (television, washer-dryer, etc.) your monthly will be about US$200. For some people this may seem high, but for others, about what they pay per month if they currently live in a warm weather climate such as California, Texas or Florida. Monthly food shopping bills will vary because it really all depends upon what you buy. Meaning if you stick with local products and produce (which are quite good) you food bill will be lower than if you buy nothing but foreign or imported items. Very good imported wines from Chile and Argentina cost about US$9 per bottle, however many people have told us that other spirits were much cheaper in the Dominican Republic than what they are in the US, so it really all depends on what you are buying, item by item.
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A live in maid will cost you about RD$4,000 Pesos per month (which is actually quoting on the high side) or the equivalent of about US$150 per month. Some people have a maid come in twice or three times a week (that cooks the day she is in, does laundry, irons, etc.) and the going rate comes out to about US$15 per day for 8:00AM to 4:00PM (more or less).
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We already discussed the idea of buying a new home or apartment, which you can do in the capital city of Santo Domingo starting at about US$60,000 (obviously the equivalent of the current price in Pesos) and you can go up to perhaps US$130,000 or so - all depending upon where and what you want. However, as of March 2005, the availability of a brand new 1,500 square foot 3-bedroom apartment for about US$60,000 or a brand new 2,300 square foot home in a gated residential community for US$100,000 is very real. Forget about the advertisements for properties marketed in tourist areas to tourists for US$400,000 or more. These properties are out there if you want them, but the reality is that new homes or apartments are very affordable in the Dominican Republic, putting the tourist-oriented or golf course developments aside. Even so, we have seen some building lots being offered in some of the gated higher end golf course communities for about US$55,000 recently as well, so prices there too seem to have come back down to reality in some cases.
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If you are renting, again, you might see some ridiculous things being asked or offered, but it is very possible to find an acceptable 2 or 3 bedroom apartment up to what might be called American or European standard in an upper middle class residential area for the equivalent of about US$500 per month. So again, when making comparisons to some other jurisdictions in the Caribbean, chances are that you will find the Dominican Republic to be a bargain in comparison.
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This information was provided by John Schroder of Ascot Advisory Services. Mr. Schroder has lived in the Dominican Republic for many years, and still resides in Santo Domingo. His firm assists clients with Real Estate related matters, Residency Filing and Banking Introduction Services.