The Dominican Republic real estate market is truly unique in that it offers so many "pockets" or sub-markets where real estate developments within don't follow in accordance with the general rule of thumb during an economic crisis.
Cap Cana, and the Real Estate within this area could be considered one of these sub-markets. Developed in 2002, it immediately piggy backed of the expertise of Farallon and the brand recognition of Donald Trump. This thrusted Cap Cana into an immediate "exlusive" market.
Unfortunately, as the economic crisis became a reality, construction and development came to a standstill. Near the end of 2008, on through 2010 one could drive through Cap Cana and notice all the partially constructed projects, the near-abandoned Marina Village, the run-down ruins of what was once "Green Village" and many vacant overgrown housing lots. It was not a pretty picture and at times may have even been considered a great blunder in Punta Cana, Dominican Republic. This area went from being the next tropical paradise resort community to a ghost town of what may have been. Construction halted, banks screamed, money was lost.
A contributing factor to this stall-out may have been Cap Cana's switching to marketing to a less affluent crowd; eventually the demographic that would be all but wiped out during the crisis. The middle class stopped buying. No more credit cards, no more second, third, and forth mortgages.
These mid range properties, ranging from 300,000 USD to around 1,500,000 USD seem to be sitting on the market waiting for their prime buyer. This buyer will be someone that is keen enough to wait "just a little bit longer" to get even a better deal. Some properties in this price range do sell however, and they sell to a buyer who has determined that spending "X" amount of dollars in a competing community with fewer amenities now justifies the purchase of a unit for "X" amount of dollars. Unfortunately there just aren't enough of these comparison shoppers to make a difference in today's local marketplace.
On the flip-side, ultra-premium buyers are now stepping up to the plate. This demographic has not lost during the crisis, but they have gained. They now are targeting communities that have the infrastructure in place, and exist in the location to be truly great communities. Cap Cana is ready for this re-birth. Golf course and ocean view real estate within the area is on track to pick up sales slack, and the ultra-affluent are the ones that will soon be coming to the table to lay down claim on their new piece of paradise. As this transition occurs, a new demand will arise for the "lower-end" products Cap Cana has to offer, as those will soon again be sound investments.
