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Frequently asked questions
Find answers to common questions about real estate investment and buying property in the Dominican Republic.
Investment & market
Understanding the potential and costs of the Dominican Republic real estate market.
- What is the potential of the Dominican Republic for real estate investment?
- The Dominican Republic is a favorable country for real estate investment, especially in the north coast region. The country has a stable financial, legal, and political system, which has increased the demand for real estate properties. Additionally, the pandemic has encouraged people to seek a second home, making the Dominican Republic a suitable place to invest in short-term rental properties.
- Are there affordable real estate properties in the Dominican Republic?
- Yes, the Dominican Republic offers a wide range of real estate properties to suit all budgets and pockets. It is important to determine the amount of money you can invest before beginning your search. We offer affordable houses, villas, apartments, and condos as well as land for sale at low prices.
- Is the cost of living cheap in the Dominican Republic?
- The cost of living in the Dominican Republic is relatively inexpensive for foreigners. Essential services and daily consumer products are affordable, and you can even indulge yourself in weekend trips or visits to fancy restaurants. The prices of fruits and vegetables in the Dominican Republic are notably cheaper than in many European and North American countries. Cities such as Puerto Plata, Sosúa, and Cabarete offer comfortable living with affordable prices. We recommend trying typical Dominican restaurants for an authentic experience.
- What is the state of the real estate market in the Dominican Republic?
- The real estate market in the Dominican Republic is growing, with new developments and investment opportunities emerging in popular tourist destinations.
Buying process & eligibility
Information about purchasing property, requirements, and associated factors.
- Can foreigners purchase real estate properties in the Dominican Republic?
- Yes, both foreign and Dominican residents living abroad can buy real estate properties in the Dominican Republic without any issues. If you're considering buying a villa in Cabarete or Sosua from European or American countries, you won't face any restrictions.
- What is the process for buying property in the Dominican Republic?
- The process for buying property in the Dominican Republic involves finding a property, making an offer, signing a purchase agreement, paying a deposit, obtaining a property survey, and completing the final sale.
- Are there any taxes associated with buying property in the Dominican Republic?
- Yes, there are taxes associated with buying property in the Dominican Republic, including transfer taxes, legal fees, and title insurance.
- Is it necessary to hire a lawyer when buying property in the Dominican Republic?
- It is highly recommended to hire a lawyer when buying property in the Dominican Republic, as they can assist with due diligence, title searches, and the legal process of purchasing property.
- Can I obtain financing to buy property in the Dominican Republic?
- Yes, there are banks and financial institutions in the Dominican Republic that offer financing options for purchasing property.
- Are there any restrictions on the type of property foreigners can buy in the Dominican Republic?
- No, foreigners can buy any type of property in the Dominican Republic, including land, homes, businesses and commercial properties for sale.
- Are there any risks associated with buying property in the Dominican Republic?
- As with any real estate transaction, there are risks involved when buying property in the Dominican Republic. However, hiring a reputable lawyer and conducting thorough due diligence can help mitigate these risks. Contact Century 21 Perdomo if you have more questions about the real estate market in the north coast of the Dominican Republic.
Taxes, costs & incentives
What you'll pay to buy and hold property — and how to pay less, legally.
- What are the closing costs when buying property in the Dominican Republic?
- Closing costs are typically around 3–4% of the property's value. The main item is the transfer tax of 3% on the government-assessed value, paid to register the title in your name, plus notary and legal fees (usually about 1–1.5%) and minor registration costs. Your lawyer will give you an exact estimate before you sign.
- Is there an annual property tax in the Dominican Republic?
- Yes. The annual property tax (IPI) is 1% on the portion of a property's value above an exemption threshold that is adjusted each year. Many lower-value properties fall under the threshold and pay no IPI, and property held through a company is taxed differently — ask your advisor which structure fits your situation.
- What is CONFOTUR and how can it reduce my taxes?
- CONFOTUR is a tourism-incentive law that grants qualifying developments a temporary exemption from the 3% transfer tax and from the annual IPI property tax, commonly for around 15 years. Many new projects on the North Coast are CONFOTUR-approved, so buying in one can save you the transfer tax at closing and years of property tax. We can tell you which of our listings qualify.
- Do I pay capital gains tax when I sell?
- Yes. Capital gains are taxed (currently at 27% on the inflation-adjusted gain) when you sell. Keeping good records of your purchase price and improvements lowers the taxable gain, and CONFOTUR or an ownership structure can change the outcome — plan any sale with a tax advisor in advance.
- Is rental income taxed?
- Yes, rental income earned in the Dominican Republic is taxable. Individuals are generally taxed on net rental income and may deduct legitimate expenses; many owners hold rental property through a company for efficiency. A local accountant can set this up correctly for you.
Titles & legal security
Making sure what you buy is clean, registered, and truly yours.
- What kind of title will I receive, and is it secure?
- The Dominican Republic uses a Torrens-style registry, and the strongest proof of ownership is a Certificate of Title (Certificado de Título) issued by the Title Registry. A properly titled, surveyed property gives you clear, state-guaranteed ownership. Always confirm the title is registered in the seller's name before you buy.
- What is a 'deslinde' and why does it matter?
- A deslinde is the legal survey that individualizes a parcel and gives it its own Certificate of Title. Buying land that is already deslindado (individually titled) is safer and faster than buying an undivided share of a larger parcel. Your lawyer will verify the deslinde status during due diligence.
- What due diligence should be done before I buy?
- Your lawyer should confirm the title is registered to the seller, check for liens, mortgages or unpaid taxes, verify the survey and boundaries, confirm there are no occupants or disputes, and review the HOA or developer documents. Never pay a deposit before this title search is complete.
- Can foreigners own beachfront property in the Dominican Republic?
- Yes. Foreigners have the same ownership rights as Dominicans and can own beachfront homes and condos. Keep in mind that the first 60 meters from the high-tide line is public maritime zone that cannot be privately owned, so confirm where your title actually begins — your lawyer will check this.
Residency, banking & funds
Practical questions about buying from abroad and settling in.
- Do I need residency to buy property in the Dominican Republic?
- No. You don't need residency or citizenship to buy — foreigners can purchase in their own name with a valid passport. Owning property can, however, support a residency application later if you decide to live here.
- Can a foreigner open a bank account or get a mortgage locally?
- Foreigners can open local bank accounts, usually more easily with residency or with help from your lawyer. Some Dominican banks offer mortgages to foreigners, typically with larger down payments and higher rates than at home, so many international buyers pay cash or finance through the developer.
- How do I transfer the money to buy a property?
- Funds are normally wired from your home bank to a local account — often your lawyer's escrow account — for closing. Keep proof of the inbound transfer: it documents that the money entered the country, which makes it much simpler to move your proceeds back out when you eventually sell.
- What currency are properties priced and paid in?
- On the North Coast most properties are priced and transacted in US dollars, although the official currency is the Dominican peso (DOP). You can pay in dollars; some closing taxes are calculated and paid in pesos at the day's exchange rate.
Owning, renting & returns
Rental income, ongoing costs, and the day-to-day of owning here.
- Can I rent out my property, including short-term and Airbnb?
- Yes. Short-term and vacation rentals are popular and legal on the North Coast, and many buyers offset their costs with rental income. Some condo communities set their own rules on short-term rentals, so check the HOA regulations before buying if rental income is your goal.
- What rental returns can I expect?
- Returns vary with location, property type and how actively the rental is managed, but well-located North Coast vacation rentals commonly target gross yields in the mid-to-high single digits. We can share realistic occupancy and rate expectations for a specific property and area.
- Will I need a property manager, and what are HOA fees?
- If you don't live here full-time, a property manager handles bookings, cleaning, maintenance and bill payments, usually for a percentage of the rent. Condos and gated communities also charge HOA/maintenance fees for security, common areas and amenities — always factor these into your budget.
- What are condominium maintenance fees in the Dominican Republic?
- Condominium maintenance fees in the Dominican Republic can range from $100 to $500 per month, depending on factors such as location, condo size, amenities, and maintenance level. These fees may cover maintenance, repairs, security, cleaning, landscaping, and access to amenities. It's important to consider these fees in your budget and work with a reliable real estate agent for guidance.
Still have questions?
Contact Century 21 Perdomo if you have more questions about the real estate market on the north coast of the Dominican Republic.
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