Airbnb Investment in Dominican Republic: ROI, Regulations & Best Locations 2025

Why the Dominican Republic for Airbnb Investment?

The Dominican Republic welcomed 10+ million tourists in 2024, making it the Caribbean's top destination. This visitor volume, combined with relatively low property prices and favorable regulations, creates compelling short-term rental opportunities.

Key market advantages:

• Year-round demand: Consistent tourism from North America and Europe across all seasons
• Low property taxes: Just 1% annually on value above ~US$170,000
• No short-term rental restrictions: Unlike many U.S. cities, no HOA or municipal limits (in most areas)
• Digital nomad growth: 30-60 day stays from remote workers seeking affordable Caribbean bases
• Direct flights: Major airports with connections to 100+ cities worldwide

Expected ROI by Property Type

Condos (1-2 Bedrooms)

• Purchase price: US$150,000–$350,000
• Average nightly rate: US$80–$180
• Occupancy rate: 65–78%
• Gross annual revenue: US$25,000–$50,000
• Net yield after expenses: 8–12%

Villas (3-5 Bedrooms)

• Purchase price: US$400,000–$1,200,000
• Average nightly rate: US$250–$600
• Occupancy rate: 55–70%
• Gross annual revenue: US$60,000–$150,000
• Net yield after expenses: 7–11%

Budget Apartments

• Purchase price: US$80,000–$150,000
• Average nightly rate: US$45–$80
• Occupancy rate: 70–85%
• Gross annual revenue: US$15,000–$25,000
• Net yield after expenses: 10–15%

Best Locations for Airbnb Investment

1. Sosúa

Best for: Beach vacationers, couples, families

• Famous Sosúa Beach attracts consistent tourist traffic
• Strong mix of budget and luxury travelers
• Average occupancy: 72%
• Recommended: 1-2 bedroom oceanview condos

2. Cabarete

Best for: Kitesurfers, digital nomads, active travelers

• World-renowned kiteboarding destination
• Strong digital nomad community = longer stays
• Average occupancy: 68%
• Recommended: Beachfront condos with workspace

3. Punta Cana

Best for: Resort-style vacationers, weddings, groups

• Highest tourist volume in the country
• Competes with all-inclusive resorts on value
• Average occupancy: 75%
• Recommended: Resort condos, large villas for groups

4. Las Terrenas

Best for: European travelers, upscale tourists

• French/European expat influence
• Boutique, less commercialized feel
• Average occupancy: 62%
• Recommended: Unique villas, boutique apartments

5. Puerto Plata

Best for: Cruise passengers, history enthusiasts, budget travelers

• Growing cruise port traffic
• Lower property prices = higher yields
• Average occupancy: 58%
• Recommended: Colonial-style properties, budget condos

Operating Costs and Expenses

Budget for these expenses when calculating net returns:

• Property management: 20-30% of gross revenue (full service)
• Cleaning (per turnover): US$25–$75 depending on size
• Utilities: US$150–$400/month (varies by A/C usage)
• HOA/maintenance: US$200–$600/month for condos
• Insurance: US$500–$1,500/year
• Platform fees: Airbnb 3%, Booking.com 15%
• Supplies and amenities: US$100–$300/month
• Repairs reserve: 5% of gross revenue

Rule of thumb: Expect net income to be 50-65% of gross revenue with professional management.

Legal Requirements for Short-Term Rentals

The Dominican Republic has minimal regulations compared to many countries:

• No licensing required: Most areas don't require short-term rental permits
• Tax obligations: Rental income is subject to income tax (25% corporate or graduated personal rates)
• ITBIS (VAT): 18% on short-term rentals, though enforcement varies
• HOA rules: Some condo associations restrict short-term rentals—verify before purchase
• Insurance: Liability coverage recommended

Work with a local accountant to structure rental income tax-efficiently and ensure compliance.

Property Management Options

Full-Service Management (20-30% fee)

• Guest communication and booking management
• Cleaning coordination
• Maintenance and repairs
• Dynamic pricing optimization
• Check-in/check-out handling
• Owner reporting

Partial Management (10-15% fee)

• Cleaning and turnover only
• Emergency maintenance
• Owner handles bookings and guest communication

Self-Management (Remote)

• Use smart locks for keyless entry
• Hire local cleaners directly
• Manage listings and communication yourself
• Best for experienced Airbnb hosts

Sadeghi Group can connect buyers with vetted property management companies in each location.

Tips to Maximize Airbnb Revenue

• Professional photography: Invest in high-quality photos—they dramatically improve click-through rates
• Dynamic pricing: Use tools like PriceLabs or Wheelhouse to optimize nightly rates
• Superhost status: Maintain high ratings for better search visibility
• Multi-platform listing: List on Airbnb, VRBO, Booking.com, and direct booking sites
• Local amenities: Stock Dominican coffee, provide beach gear, create local experience guides
• Fast WiFi: Essential for digital nomad appeal—advertise speeds in your listing
• Mid-term discounts: Offer weekly and monthly discounts to capture digital nomad market
• Responsive communication: Reply to inquiries within 1 hour for algorithm benefits

Find Your Airbnb Investment Property

Ready to start generating rental income in the Dominican Republic? Sadeghi Group specializes in identifying properties optimized for short-term rental returns.